Press Release: TOPAZ Announces THIRD Quarter 2026 Financial Results Including 9% Royalty Production Growth

Dow Jones06:00

CALGARY, AB, Nov. 2, 2026 /CNW/ -- Topaz Energy Corp. (TSX:TPZ) ("Topaz" or the "Company") is pleased to provide third quarter 2026 financial results. Select financial information is outlined below and should be read in conjunction with Topaz's interim condensed consolidated financial statements ("Financial Statements") and related management's discussion and analysis ("MD&A") as at and for the three and nine months ended September 30, 2026, which are available on SEDAR+ at www.sedarplus.ca and on Topaz's website at www.topazenergy.ca.

Highlights

   -- Q3 and YTD 2026 average royalty production of 23,507 boe/d(4) and 24,112 
      boe/d(4) each increased 9% from the prior year, highlighted by 13% higher 
      heavy oil royalty production (3,825 bbl/d). 
 
   -- Tourmaline's ownership in Topaz reduced from 12.9% to 5.4% on October 8, 
      2026(9) as part of Tourmaline's long-term plan to reduce its equity 
      position and enhance financial flexibility and expand Topaz's 
      free-trading share liquidity.  Topaz holds royalty interests across 
      virtually all of Tourmaline's acreage, providing significant long-term 
      growth exposure to the systematic development of Tourmaline's most 
      profitable, liquids-rich undeveloped Montney inventory in NEBC. 
 
   -- During Q3 2026, 175 gross wells (6.3 net)(5) were drilled on Topaz's 
      royalty acreage, representing a 9% increase from the prior year.  To date 
      in 2026, a total of 587 gross wells(6) were brought on production or 
      drilled uncompleted, with over 50% oil-focused development activity, 
      demonstrating the diversification within Topaz's royalty portfolio. 
 
   -- Q3 2026 cash flow and net income of $0.56 and $0.21 per share(2), 
      increased 14% and 24%, respectively, from the prior year, driven by 42% 
      higher realized commodity pricing and 13% lower cash expenses(10). 
 
   -- Q3 2026 FCF per share of $0.55 increased 16% from Q3 2025, providing a 3% 
      higher dividend and $0.20 per share (50%) higher excess FCF from Q3 2025. 
 
   -- Q3 2026 exit net debt of $463.5 million decreased $71.9 million (13%) 
      from the prior year. 
 
   -- Declared the fourth quarter dividend of $0.35 per share ($1.40 per share 
      annualized)(8) representing a 4.5% trailing annualized yield to Topaz's 
      current share price(7). 

Third Quarter 2026 Update

Financial Overview

   -- Topaz generated total revenue and other income of $104.3 million, 78% 
      from the royalty portfolio and 22% from infrastructure and other income. 
 
   -- Cash flow of $0.56 per share(2) ($87.0 million) was 14% higher than the 
      prior year driven by 9% higher royalty production and 42% higher realized 
      commodity pricing. 
 
   -- Free cash flow of $0.55 per share(2) ($85.4 million) increased 17% from 
      the prior year.  Topaz paid $54.3 million in dividends during the quarter 
      ($0.35 per share and 62% payout ratio(1)) and generated $31.1 million of 
      Excess FCF(1). 
 
   -- Topaz exited Q3 2026 with $463.5 million of net debt(1) (1.1x net debt to 
      Q3 2026 annualized EBITDA(1)).  As at November 2, 2026, Topaz has 
      approximately $0.5 billion of available credit capacity which provides 
      financial flexibility for strategic growth opportunities. 

Royalty and Infrastructure Activity

   -- Q3 2026 average royalty production of 23,507 boe/d(4) (30% total liquids) 
      increased 9% from Q3 2025 (21,596 boe/d and 31% total liquids).  Oil and 
      heavy oil royalty production increased 8% and natural gas and NGL 
      production increased 9% despite certain natural gas volume curtailments 
      during the third quarter attributed to maintenance activity and natural 
      gas price volatility. 
 
   -- During Q3 2026, 175 gross wells (6.3 net)(5) were drilled on Topaz's 
      royalty acreage, of which 64% were drilled uncompleted (Q3 2025 -- 161 
      gross wells and 58%, respectively). 
 
   -- During Q3 2026, Topaz generated $81.5 million royalty production revenue, 
      84% from total liquids royalty production and 16% from natural gas 
      royalty production. 
 
   -- During Q3 2026, Topaz generated $22.9 million in processing revenue and 
      other income. The infrastructure assets generated 98% utilization and 
      $22.0 million of operating margin (96%)(1). 
 
   -- Topaz estimates that operators invested $0.6 billion to $0.7 billion of 
      development capital across the Company's royalty acreage in Q3 2026, with 
      drilling activity (175 gross wells spud(5)) diversified as follows: 65 
      Clearwater, 34 NEBC & Alberta Montney, 38 Deep Basin, 8 Peace River, 11 
      SE Saskatchewan, and 19 in Central AB. 
 
   -- During Q3 2026, 178 gross wells were brought on production(5) and based 
      on planned operator drilling activity, Topaz expects 24 to 29 drilling 
      rigs to be active across its royalty acreage through the fourth quarter 
      of 2026(3). 

Dividend

   -- Topaz's Board declared the fourth quarter 2026 dividend at $0.35 per 
      share(8) which is expected to be paid on December 31, 2026, to 
      shareholders of record on December 15, 2026.  The quarterly cash dividend 
      is designated as an "eligible dividend" for Canadian income tax purposes. 

2026 Guidance Reconfirmed

   -- Topaz reconfirms the Company's 2026e guidance estimates of average annual 
      royalty production between 23,900 boe/d and 24,300 boe/d, and 
      infrastructure processing revenue and other income of approximately $93.0 
      million(3)(11). Topaz expects to exit 2026 with net debt(1) between 
      $425.0 and $430.0 million(3)(11). 

Q3 2026 CONFERENCE CALL

Topaz will host a conference call tomorrow, Tuesday, November 3, 2026 starting at 9:00 a.m. ABT (10:00 a.m. EST). To join the conference call without operator assistance, participants can register and enter their phone number at https://emportal.ink/4dPR5Mc to receive an instant automated call back. Alternatively, participants can join by calling a live operator at 1-888-510-2154 (North American toll free). The conference call ID is 11522.

ABOUT THE COMPANY

Topaz is a unique royalty and infrastructure energy company focused on generating free cash flow growth and paying reliable and sustainable dividends to its shareholders, through its strategic relationship with Canada's largest and most active natural gas producer, Tourmaline Oil Corp. ("Tourmaline"), an investment-grade senior Canadian E&P company, and leveraging industry relationships to execute complementary acquisitions from other high-quality energy companies. Topaz focuses on top-quartile energy resources and assets best positioned to attract capital in order to generate sustainable long-term growth and profitability.

Topaz's common shares are listed and posted for trading on the TSX under the trading symbol "TPZ" and it is included in the S&P/TSX Composite Index. This is the headline index for Canada and is the principal benchmark measure for the Canadian equity markets, represented by the largest companies on the TSX.

Additional information

Additional information about Topaz, including the Financial Statements and MD&A as at and for the three and nine months ended September 30, 2026 are available on SEDAR+ at www.sedarplus.ca under the Company's profile, and on Topaz's website at www.topazenergy.ca.

 
Selected Financial Information 
 For the periods ended                             YTD 2026  YTD 2025  Q3 2026    Q2 2026    Q1 2026    Q4 2025    Q3 2025 
  ($000s) except per share 
  Royalty production revenue                        241,605   179,342     81,458     88,932     71,215     62,468       52,291 
  Processing revenue                                 62,830    60,977     21,051     20,742     21,037     21,930       21,221 
  Other income(4)                                     5,686     9,467      1,825      1,540      2,321      2,320        2,931 
Total                                               310,121   249,786    104,334    111,214     94,573     86,718       76,443 
Cash expenses: 
  Operating                                         (4,498)   (5,503)      (866)    (1,877)    (1,755)    (1,027)      (1,545) 
  Marketing                                         (1,397)   (1,122)      (393)      (532)      (472)      (415)        (307) 
  General and administrative                        (6,014)   (5,936)    (1,936)    (1,880)    (2,198)    (3,338)      (1,864) 
  Realized gain (loss) on financial instruments     (3,138)    14,724      1,170    (2,522)    (1,786)      5,102        8,737 
  Current income tax expense(8)                    (22,209)        --    (9,523)   (10,186)    (2,500)         --           -- 
  Interest expense                                 (17,344)  (19,741)    (5,791)    (5,828)    (5,725)    (6,486)      (6,620) 
Cash flow                                           255,521   232,208     86,995     88,389     80,137     80,554       74,844 
Per basic share(1)(2)                                 $1.65     $1.51      $0.56      $0.57      $0.52      $0.52        $0.49 
Per diluted share(1)(2)                               $1.65     $1.50      $0.56      $0.57      $0.52      $0.52        $0.49 
Cash from operating activities                      274,000   239,617    100,066     90,530     83,404     69,143       78,147 
    Per basic share(1)(2)                             $1.77     $1.56      $0.65      $0.58      $0.54      $0.45        $0.51 
    Per diluted share(1)(2)                           $1.77     $1.55      $0.64      $0.58      $0.54      $0.45        $0.51 
Net income                                          118,543    96,047     32,021     52,483     34,039     32,694       25,573 
    Per basic share(2)                                $0.77     $0.62      $0.21      $0.34      $0.22      $0.21        $0.17 
    Per diluted share(2)                              $0.76     $0.62      $0.21      $0.34      $0.22      $0.21        $0.17 

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