Condor Energies Inc. (TSX: CDR): 4Q25 drilling in Uzbekistan could add 26-40 mmcf/d. First LNG in Kazakhstan in 2Q26
• 2Q25 gross production averaged 10,258 boe/d, consistent with prior indications.• Drilling of the first vertical well in Uzbekistan will begin in early September. The well will target the producing carbonate reservoir, as well as deeper clastic formations and fractured basement intervals. A successful outcome in the deeper zones could result in material reserves additions.
• Two new horizontal wells will be drilled in 4Q25, each expected to deliver initial production rates of 13–20 mmcf/d (26–40 mmcf/d combined) and recover ~4.7 bcf. This represents a notable improvement over the earlier estimate of 15 mmcf/d per well , reflecting a more granular analysis of historical production data from these reservoirs. The contribution from horizontal wells had not been factored into the YE24 independent reserves estimates.
• In parallel, Condor intends to install field compression infrastructure in 2026 to mitigate rising sales gas pipeline pressures. This will enable lower wellhead pressures across select wells, unlocking incremental production. The initiative is expected to boost existing output by 25–55%, more than offsetting the anticipated 18-20% annual natural decline. The capex of the project is currently estimated at US$10-20 mm.
• We forecast FY26 production of ~16.5 mboe/d, representing a ~60% increase versus 2Q25 levels. This estimate may prove conservative.
• With a significant uplift in volumes anticipated in 4Q25, and first LNG production in Kazakhstan still expected in 2Q26, we reaffirm our target price of C$5.90/sh.
Kazakhstan LNG and financials
First LNG production from the initial modular facility remains on track for 2Q26. The total capex for this unit is estimated at ~C$36 mm (C$2.9 mm has already been incurred). To support development ahead of third-party financing, Condor has secured a US$5 mm bridge loan (~C$7 mm) from its largest shareholder with interest of 9% per annum and generous terms. As of end-June, Condor reported ~C$12 mm in cash, following a C$15 mm build-up in receivables, which were subsequently collected in July. Our unrisked NAV for the first modular LNG facility—designed to produce 48,000 gallons (80 tonnes) per day—is ~C$1.19/Sh. The total unrisked value of Condor’s broader LNG portfolio exceeds C$8.00/Sh. We estimate the facility will generate ~US$10 mm (~C$14 mm) in annual operating cash flow.
Valuation
Our ReNAV is unchanged at ~C$5.90 per share.
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