Zephyr Energy PLC (AIM: ZPHR, OTCQB: ZPHRF) has released a year-end update reporting higher hydrocarbon production from its non-operated portfolio in the third quarter of 2025.
Average net production increased to 925 barrels of oil equivalent per day (boepd), up from 632 boepd in the second quarter. The uplift followed the completion of a US$7.3 million acquisition of producing assets in August, partly offset by natural production decline.
The company said output also benefited from the restart of six previously shut-in wells, which resumed production in October and are expected to contribute around 130 boepd net during the fourth quarter.
Year-end update, including:
· A material increase in hydrocarbon production from the non-operated asset portfolio during the third quarter of 2025 (“Q3”), compared to the second quarter of 2025 (“Q2”);
· An active portfolio management strategy which continues to generate value and additional cash proceeds;
· An extension to the initial six-month term of the strategic partnership which was announced in Q2 and is designed to fund non-dilutive growth in the Company’s non-operated portfolio;
· A successful renewal of, and lowered interest rate on, Zephyr’s existing revolving credit facility; and
· An update on ongoing activity at the Company’s flagship project in the Paradox Basin, Utah, U.S. (the “Paradox project”), including progress towards first gas and the receipt of marketing/funding proposals.
Q3 production – initial results
· Q3 production from the Company’s non-operated asset portfolio averaged 925 barrels of oil equivalent per day (“boepd”), net to Zephyr, versus average net production in Q2 of 632 boepd.
o The increase demonstrates the impact of the $7.3 million acquisition of accretive production assets announced on 26 August 2025 (the “Acquisition”), offset by standard decline of the existing non-operated portfolio.
o As previously announced, production in Q2 and Q3 was impacted by six wells operated by Slawson Exploration (the “Slawson wells”) which were shut-in during those periods. Production from the Slawson wells recommenced in October 2025 and is expected to add additional production of circa 130 boepd, net to Zephyr, in the fourth quarter of 2025 (“Q4”).
· At 30 September 2025, Zephyr’s post-Acquisition portfolio consisted of interests in over 600 gross wells (or approximately 30 net wells) available for production, versus 228 gross wells at the end of Q2. Zephyr’s portfolio now consists of well and acreage interests in Utah, Colorado, Wyoming, Montana and North Dakota, providing diversity across multiple operators and basins.
· During Q3, the Company hedged a total of 24,000 barrels of oil (“bbls”) at a weighted average price of $65.18 per barrel of oil (“bbl”).
Chief executive Colin Harrington described 2025 as “an extremely active year”, highlighting the successful drilling, completion and testing of a well on the company’s Paradox acreage, alongside a subsequent upgrade to reserves and resource estimates.
He added that Zephyr continued to expand its non-operated portfolio through acquisitions and third-party investments, while also delivering value through the divestment of non-core acreage and operations.
Looking ahead, Harrington said 2026 is expected to mark the next phase of growth for the company, supported by rising interest in Western US oil and gas markets and ongoing discussions aimed at accelerating development activity in the Paradox Basin.
