Epsilon Energy Ltd. reported its financial results for the full year ended December 31, 2024, noting a challenging natural gas environment where Marcellus net wellhead prices were below $2 per Mcf. Approximately 20-25% of the company's Marcellus production was curtailed during the year, impacting both upstream and midstream operations, including lower throughput volumes for the Auburn Gas Gathering System.
Despite these headwinds, Epsilon returned $7.3 million to shareholders during 2024 through fixed quarterly dividends and opportunistic share repurchases. The company's capital expenditures for the year increased by 58% year-over-year to $34.9 million, with approximately 70% allocated to Texas assets and 15% to Pennsylvania. The remainder was primarily for drilling four gross (1.5 net) wells in Alberta.
Epsilon's Proved reserves increased by 20% year-over-year, driven by positive revisions to prior estimates and development activity in Texas, which added Proved undeveloped reserves. The company expects a strong year in 2025, with material growth in production and cash flows, as curtailed Marcellus volumes and delayed new wells are now coming online, producing 75% more natural gas than the 2024 average daily volumes into an improved price environment. Total revenue for the full year 2024 was US$31.5 million, a 2.6% increase from 2023, though earnings per share missed expectations.
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