Tenaz Energy is experiencing rapid production growth, primarily fueled by significant acquisitions in the Dutch North Sea, which have positioned Europe as the main driver of its expansion. The company's production surged by over 250% in 2025 due to these acquisitions, with further growth anticipated from ongoing drilling and workover programs. Anthony Marino, President and CEO of Tenaz Energy, highlighted that the European market is now paramount for the company, with its Canadian assets representing a minor portion of production, around 10%. He emphasized that European gas operations, particularly in the Netherlands, are expected to become an increasingly larger part of the company due to strong growth prospects and high European gas prices linked to the TTF benchmark.
Marino explained that two major acquisitions in the Dutch North Sea, one from Shell and Exxon and another from private equity, are pivotal to their recent success. These assets, including a midlife asset with significant undeveloped potential and an early-stage development project, offer numerous opportunities for organic growth through drilling and development. He noted that the company expects to grow to approximately 21,000 boe/d at the midpoint for 2026, up about 5,000 boe/d from its 2025 closing rate, with organic development being the primary source of this growth.
The company has outlined a capital program of $250 million to $275 million for 2026, entirely dedicated to organic growth initiatives. This investment will fund drilling activities using its operated rig and two non-operated rigs, alongside a workover program. These efforts are expected to yield strong results, as workovers are highly economic. About 90% of Tenaz Energy's product mix, and an even higher percentage of its revenue, is tied to Netherlands gas, which trades on the TTF index. The current strong gas prices create opportunities for hedging future production at favorable rates, with the company approximately half hedged for the current year. Marino indicated that Tenaz Energy is open to M&A in the Netherlands and nearby regions like the UK, Norway, and Germany, but its core focus is on consistent organic growth. Tenaz Energy is believed to be the largest natural gas producer among industry players in the Netherlands, with domestic production currently supplying about 30% of the country's demand.
