UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2025
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 001-39191
Ovintiv Inc.
(Exact name of registrant as specified in its charter)
Delaware
84-4427672
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
Suite 1700, 370 17th Street, Denver, Colorado, 80202, U.S.A.
(Address of principal executive offices)
Registrant’s telephone number, including area code (303) 623-2300
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Shares
OVV
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
Number of registrant’s shares of common stock outstanding as of October 24, 2025
253,258,560
1
OVINTIV INC.
TABLE OF CONTENTS
PART I
Item 1.
Financial Statements
6
Condensed Consolidated Statement of Earnings
Condensed Consolidated Statement of Comprehensive Income
Condensed Consolidated Balance Sheet
7
Condensed Consolidated Statement of Changes in Shareholders’ Equity
8
Condensed Consolidated Statement of Cash Flows
10
Notes to Condensed Consolidated Financial Statements
11
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
34
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
60
Item 4.
Controls and Procedures
62
PART II
Legal Proceedings
63
Item 1A.
Risk Factors
Unregistered Sales of Equity Securities and Use of Proceeds
65
Defaults Upon Senior Securities
66
Mine Safety Disclosures
Item 5.
Other Information
Item 6.
Exhibits
Signatures
67
2
DEFINITIONS
Unless the context otherwise requires or otherwise expressly stated, all references in this Quarterly Report on Form 10-Q to “Ovintiv,” the “Company,” “us,” “we,” “our,” and “ours” refer to Ovintiv Inc. and its consolidated subsidiaries. In addition, the following are other abbreviations and definitions of certain terms used within this Quarterly Report on Form 10‑Q:
“AECO” means Alberta Energy Company and is the Canadian benchmark price for natural gas.
“ASU” means Accounting Standards Update.
“bbl” or “bbls” means barrel or barrels.
“BOE” means barrels of oil equivalent.
“Btu” means British thermal units, a measure of heating value.
“CORRA” means Canadian Overnight Repo Rate Average.
“DD&A” means depreciation, depletion and amortization expenses.
“FASB” means Financial Accounting Standards Board.
“GHG” means greenhouse gas.
“Mbbls/d” means thousand barrels per day.
“MBOE/d” means thousand barrels of oil equivalent per day.
“Mcf” means thousand cubic feet.
“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations.
“MMBOE” means million barrels of oil equivalent.
“MMBtu” means million Btu.
“MMcf/d” means million cubic feet per day.
“NCIB” means normal course issuer bid.
“NGL” or “NGLs” means natural gas liquids.
“NYMEX” means New York Mercantile Exchange.
“NYSE” means New York Stock Exchange.
“OPEC” means Organization of the Petroleum Exporting Countries.
“SEC” means United States Securities and Exchange Commission.
“S&P 400” means Standard and Poor’s MidCap 400 index.
“TSX” means Toronto Stock Exchange.
“U.S.”, “United States” or “USA” means United States of America.
“U.S. GAAP” means U.S. Generally Accepted Accounting Principles.
“WTI” means West Texas Intermediate.
CONVERSIONS
In this Quarterly Report on Form 10-Q, a conversion of natural gas volumes to BOE is on the basis of six Mcf to one bbl. BOE is based on a generic energy equivalency conversion method primarily applicable at the burner tip and does not represent economic value equivalency at the wellhead. Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value, particularly if used in isolation.
CONVENTIONS
Unless otherwise specified, all dollar amounts are expressed in U.S. dollars, all references to “dollars”, “$” or “US$” are to U.S. dollars and all references to “C$” are to Canadian dollars. All amounts are provided on a before tax basis, unless otherwise stated. In addition, all information provided herein is presented on an after royalties basis.
3
The terms “include”, “includes”, “including” and “included” are to be construed as if they were immediately followed by the words “without limitation”, except where explicitly stated otherwise.
The term “liquids” is used to represent oil, NGLs and condensate. The term “liquids-rich” is used to represent natural gas streams with associated liquids volumes. The term “play” is used to describe an area in which hydrocarbon accumulations or prospects of a given type occur. Ovintiv’s focus of development is on hydrocarbon accumulations known to exist over a large areal expanse and/or thick vertical section and are developed using hydraulic fracturing. This type of development typically has a lower geological and/or commercial development risk and lower average decline rate, when compared to conventional development.
References to information contained on the Company’s website at www.ovintiv.com are not incorporated by reference into, and does not constitute a part of, this Quarterly Report on Form 10-Q.
FORWARD-LOOKING STATEMENTS AND RISK
This Quarterly Report on Form 10-Q, and the other documents incorporated herein by reference (if any), contain certain forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, except for statements of historical fact, that relate to the anticipated future activities, plans, strategies, objectives or expectations of the Company are forward-looking statements. When used in this Quarterly Report on Form 10‑Q, and the other documents incorporated herein by reference (if any), the use of words and phrases including “anticipates,” “believes,” “continue,” “could,” “estimates,” “expects,” “focused on,” “forecast,” “guidance,” “intends,” “maintain,” “may,” “on track,” “opportunities,” “outlook,” “plans,” “potential,” “strategy,” “targets,” “will,” “would” and other similar terminology is intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words or phrases. Without limiting the generality of the foregoing, forward-looking statements contained in this Quarterly Report on Form 10‑Q include: expectations of plans, strategies and objectives of the Company, including anticipated reserves development; the Company’s ability to consummate any future acquisition and divestiture transactions; the Company’s ability to successfully integrate any acquired assets into its business; drilling plans and programs, including the amount and availability of capital to complete these plans and programs; the composition of the Company’s assets and the anticipated capital returns associated with its assets; anticipated oil, NGL and natural gas prices; the anticipated success of, and benefits from, technology and innovation, including new or advanced drilling techniques or well completion designs; anticipated drilling and completions activity, including the number of drilling rigs and frac crews utilized; anticipated proceeds and future benefits from various joint venture, partnership and other agreements; anticipated or desired benefits from acquisitions; anticipated oil, NGLs and natural gas production and commodity mix; the Company’s ability to access credit facilities, debt and equity capital markets and other sources of liquidity; the ability of the Company to timely achieve its stated environmental, social and governance goals, targets and initiatives; the impact of changes in federal, state, provincial, local and tribal laws, rules and regulations, including the impact of changes in trade policies and tariffs; anticipated compliance with current or proposed environmental legislation; the Company’s ability to manage debt and financial ratios and comply with financial covenants; the implementation and outcomes of risk management programs, including exposure to commodity prices, interest rate and foreign exchange fluctuations and the volume of oil, NGLs and natural gas production hedged; the declaration and payment of future dividends and the anticipated repurchase of the Company’s outstanding common shares; the Company’s ability to manage cost inflation and expected cost structures, including expected operating, transportation, processing and labor expenses; and the outlook of the oil and natural gas industry generally, including impacts from changes to the geopolitical environment.
The forward-looking statements included in this Quarterly Report on Form 10-Q involve risks and uncertainties that could cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. We have based these forward-looking statements on current expectations and assumptions about future events, taking into account all information currently known by us. While we consider these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks and uncertainties, many of which are difficult to predict and beyond our control. The risks and uncertainties that may affect the operations, performance and results of our business and forward-looking statements include, but are not limited to, those set forth in Item 1A. Risk Factors of the Company’s most recent Annual Report on Form 10‑K for the fiscal year ended December 31, 2024 (the “2024 Annual Report on Form 10-K”) and in this Quarterly Report on Form 10‑Q; and other risks and uncertainties impacting the Company’s business as described from time to time in the Company’s other periodic filings with the SEC or Canadian securities regulators.
4
Although the Company believes the expectations represented by its forward-looking statements are reasonable based on the information available to it as of the date such statements are made, forward-looking statements are only predictions and statements of our current beliefs and there can be no assurance that such expectations will prove to be correct. All forward-looking statements contained in this Quarterly Report on Form 10‑Q are made as of the date of this document (or in the case of a document incorporated herein by reference, the date of such document) and, except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statements. The forward-looking statements contained or incorporated by reference in this Quarterly Report on Form 10‑Q, and all subsequent forward-looking statements attributable to the Company, whether written or oral, are expressly qualified by these cautionary statements.
The reader should carefully read the risk factors described in Item 1A. Risk Factors of the 2024 Annual Report on Form 10‑K and in this Quarterly Report on Form 10‑Q for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements.
5
Item 1. Financial Statements
Condensed Consolidated Statement of Earnings (unaudited)
Three Months Ended
Nine Months Ended
September 30,
(US$ millions, except per share amounts)
2025
2024
Revenues
(Note 3)
Product and service revenues (1)
(Note 4)
$
1,731
1,775
5,460
5,562
Sales of purchased product (1)
289
403
1,149
1,196
Gains (losses) on risk management, net
(Note 19)
26
128
97
151
Sublease revenues
(Note 10)
20
18
55
Total Revenues
2,066
2,324
6,761
6,964
Operating Expenses
Production, mineral and other taxes
72
86
232
258
Transportation and processing
452
408
1,285
1,240
Operating
(Note 17)
220
235
644
715
Purchased product
278
392
1,120
1,165
Depreciation, depletion and amortization
545
599
1,646
1,745
Impairments
(Note 9)
141
-
871
Accretion of asset retirement obligation
21
14
Administrative
(Notes 16, 17)
78
247
250
Total Operating Expenses
1,793
1,797
6,066
5,387
Operating Income (Loss)
273
527
695
1,577
Other (Income) Expenses
Interest
(Note 5)
91
103
283
306
Foreign exchange (gain) loss, net
(Note 6)
(7
)
17
25
(21
Other (gains) losses, net
(3
(151
(11
(160
Total Other (Income) Expenses
81
(31
297
125
Net Earnings (Loss) Before Income Tax
192
558
398
1,452
Income tax expense (recovery)
(Note 7)
44
51
102
267
Net Earnings (Loss)
148
507
296
1,185
Net Earnings (Loss) per Share of Common Stock
(Note 13)
Basic
0.58
1.93
1.14
4.45
Diluted
0.57
1.92
1.13
4.41
Weighted Average Shares of Common Stock Outstanding (millions)
256.2
262.1
258.6
266.0
258.1
264.0
260.8
268.7
Condensed Consolidated Statement of Comprehensive Income (unaudited)
(US$ millions)
Other Comprehensive Income (Loss), Net of Tax
Foreign currency translation adjustment
(Note 14)
(73
129
(63
Pension and other post-employment benefit plans
(1
(4
Other Comprehensive Income (Loss)
(74
43
126
(67
Comprehensive Income (Loss)
74
550
422
1,118
See accompanying Notes to the unaudited Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheet (unaudited)
As at
December 31,
Assets
Current Assets
Cash and cash equivalents
42
Accounts receivable and accrued revenues (net of allowances
of $6 million (2024: $5 million))
1,059
1,183
Risk management
(Notes 18, 19)
77
108
Income tax receivable
13
36
1,174
1,369
Property, Plant and Equipment, at cost:
(Notes 8, 9)
Oil and natural gas properties, based on full cost accounting
Proved properties
69,102
66,009
Unproved properties
489
764
Other
862
865
Property, plant and equipment
70,453
67,638
Less: Accumulated depreciation, depletion and amortization
(56,330
(53,274
Property, plant and equipment, net
14,123
14,364
Other Assets
(Note 8)
1,296
965
Risk Management
Deferred Income Taxes
227
Goodwill
2,566
2,546
19,388
19,254
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable and accrued liabilities
1,678
1,883
Current portion of operating lease liabilities
112
82
Income tax payable
28
9
107
Current portion of long-term debt
(Note 11)
819
600
2,637
2,681
Long-Term Debt
4,393
4,853
Operating Lease Liabilities
1,105
737
Other Liabilities and Provisions
(Notes 12, 15)
132
114
22
Asset Retirement Obligation
433
315
432
202
9,154
8,923
Commitments and Contingencies
(Note 21)
Shareholders’ Equity
Share capital - authorized 775 million shares of stock
2025 issued and outstanding: 253.3 million shares (2024: 260.4 million shares)
Paid in surplus
7,758
8,045
Retained earnings
1,570
1,506
Accumulated other comprehensive income
903
777
Total Shareholders’ Equity
10,234
10,331
Condensed Consolidated Statement of Changes in Shareholders’ Equity (unaudited)
Three Months Ended September 30, 2025 (US$ millions)
ShareCapital
Paid inSurplus
Retained Earnings
AccumulatedOtherComprehensiveIncome
TotalShareholders’Equity
Balance, June 30, 2025
7,898
1,499
977
10,377
Dividends on Shares of Common Stock ($0.30 per share)
(77
Shares of Common Stock Purchased
Equity-Settled Compensation Costs
Balance, September 30, 2025
Three Months Ended September 30, 2024 (US$ millions)
Balance, June 30, 2024
8,170
1,215
940
10,328
(78
(163
Balance, September 30, 2024
8,025
1,644
983
10,655
Nine Months Ended September 30, 2025 (US$ millions)
Balance, December 31, 2024
Dividends on Shares of Common Stock ($0.90 per share)
(232
(307
Nine Months Ended September 30, 2024 (US$ millions)
Balance, December 31, 2023
8,620
697
1,050
10,370
(238
(597
Condensed Consolidated Statement of Cash Flows (unaudited)
Operating Activities
Net earnings (loss)
Deferred income taxes
30
19
182
Unrealized (gain) loss on risk management
12
61
Unrealized foreign exchange (gain) loss
(2
16
(45
(12
Foreign exchange (gain) loss on settlements
(41
(9
(137
33
(128
Net change in other assets and liabilities
(29
(35
Net change in non-cash working capital
(Note 20)
(76
(85
(302
Cash From (Used in) Operating Activities
812
1,022
2,698
2,701
Investing Activities
Capital expenditures
(544
(538
(1,682
(1,751
Acquisitions
31
(2,282
(202
Corporate acquisition
Proceeds from divestitures
1,922
Net change in investments and other
136
Cash From (Used in) Investing Activities
(453
(516
(1,906
(1,918
Financing Activities
Net issuance (repayment) of revolving debt
(121
(210
360
140
Repayment of long-term debt
(600
Purchase of shares of common stock
Dividends on shares of common stock
Finance lease payments and other
(32
Cash From (Used in) Financing Activities
(358
(800
(727
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents
and Restricted Cash Held in Foreign Currency
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
(17
56
Cash, Cash Equivalents and Restricted Cash, Beginning of Period
Cash, Cash Equivalents and Restricted Cash, End of Period
59
Cash, End of Period
15
Cash Equivalents, End of Period
Restricted Cash, End of Period
50
Supplementary Cash Flow Information
1.
Basis of Presentation and Principles of Consolidation
Ovintiv is in the business of the exploration for, the development of, and the production and marketing of oil, NGLs and natural gas.
The interim Condensed Consolidated Financial Statements include the accounts of Ovintiv and entities in which it holds a controlling interest. All intercompany balances and transactions are eliminated on consolidation. Undivided interests in oil and natural gas exploration and production joint ventures and partnerships are consolidated on a proportionate basis. Investments in non-controlled entities over which the Company has the ability to exercise significant influence are accounted for using the equity method.
The interim Condensed Consolidated Financial Statements are prepared in conformity with U.S. GAAP and the rules and regulations of the SEC. Pursuant to these rules and regulations, certain information and disclosures normally required under U.S. GAAP have been condensed or have been disclosed on an annual basis only. Accordingly, the interim Condensed Consolidated Financial Statements should be read in conjunction with the annual audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2024, which are included in Item 8 of Ovintiv’s 2024 Annual Report on Form 10‑K.
The interim Condensed Consolidated Financial Statements have been prepared following the same accounting policies and methods of computation as the annual audited Consolidated Financial Statements for the year ended December 31, 2024.
These unaudited interim Condensed Consolidated Financial Statements reflect, in the opinion of Management, all normal and recurring adjustments necessary to present fairly the financial position and results of the Company as at and for the periods presented. Interim condensed consolidated financial results are not necessarily indicative of consolidated financial results expected for the fiscal year.
2.
Recent Accounting Pronouncements
Changes in Accounting Policies and Practices
On January 1, 2025, Ovintiv adopted ASU 2023-09 “Improvements to Income Tax Disclosures” for annual disclosures. The standard requires disaggregated information about the Company’s effective tax rate reconciliation as well as information on income taxes paid. The amendment requires the tabular rate reconciliation to be presented using both percentages and amounts, with additional separate disclosure for any reconciling items within certain categories equal to or greater than five percent of net earnings or loss before income tax and the applicable statutory federal income tax rate. The amendment also requires the disaggregation of income taxes paid by federal, state, and foreign jurisdictions, as well as additional disaggregated information on income taxes paid to an individual jurisdiction equal to or greater than five percent of total income taxes paid. The amendments will not have a material impact on the Company’s annual Consolidated Financial Statements. The Company is currently evaluating the transition method for adoption.
New Standards Issued Not Yet Adopted
As of January 1, 2027, Ovintiv will be required to adopt ASU 2024-03 “Disaggregation of Income Statement Expenses” for annual disclosures with interim disclosures required beginning in the first quarter of 2028. The new standard requires that an entity disclose tabular information about certain expenses including, but not limited to, purchases of inventory, employee compensation, and depreciation, depletion, and amortization expense that are presented within expense line captions reported on the statement of earnings. A qualitative description of the remaining other amounts within those expense line captions will be required. The Company will also be required to determine and disclose its definition of selling expenses and the total amount of selling expenses. The amendments are to be applied prospectively, with the option for retrospective application, and are not expected to have a material impact on the Company’s Consolidated Financial Statements.
3.
Segmented Information
Ovintiv’s exploration and production activities are subdivided into two geographic segments, including the USA Operations and Canadian Operations. These segments’ activities also include third-party purchases and sales of product to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. The Company considers sales of purchased commodities as ancillary to its oil and gas development, exploration and producing activities and manages them to support such activities. In addition, the Company has a single, company-wide management team that allocates capital resources to maximize profitability and measures financial performance as a single enterprise.
Corporate and Other mainly includes unrealized gains or losses recorded on derivative financial instruments. Once the instruments are settled, the realized gains and losses are recorded in the reporting segment to which the derivative instruments relate. Corporate and Other also includes amounts related to sublease rentals and administrative costs not allocated to the operating segments.
In 2024, Ovintiv reassessed its reportable segments and determined the Chief Operating Decision Makers (“CODMs”) no longer separately reviewed the Market Optimization operational results and activities. Accordingly, Ovintiv’s Market Optimization segment was reclassified to present the Company’s market optimization activities in their respective USA and Canadian operating segments, which they support. The Market Optimization revenues, which were previously included in Product and service revenues, are presented as Sales of purchased product in the Condensed Consolidated Statement of Earnings. In conjunction with this segment reclassification, intercompany marketing fees formerly transacted between operating segments are excluded from Product and service revenues, and Sales of purchased product. Prior periods have been reclassified for comparative purposes. Additionally, intersegment eliminations are no longer required in this Segmented Information note as marketing activities are reflected in the corresponding operating segment they relate to.
The tables below summarize the results of operations and total assets by segment that are provided to the CODMs which have been identified as the Company’s President & Chief Executive Officer, Executive Vice President & Chief Operating Officer, and the Executive Vice President & Chief Financial Officer. The CODMs evaluate the performance of each of the reportable segments based on Operating Income (Loss) which is also used to assess performance and allocate capital for these segments.
The Company evaluates the effects of debt financing, interest expense and/or interest income, foreign exchange gains (losses) and other gains (losses) at a consolidated level.
Results of Operations (For the three months ended September 30)
Segment Information
USA Operations
Canadian Operations
1,103
1,379
628
396
256
380
23
37
53
1,368
1,803
698
472
Transportation and processing (1)
109
343
279
Operating (1)
178
197
38
Purchased product (1)
378
361
516
179
970
1,302
733
412
501
Corporate & Other
Consolidated
(20
49
90
83
(90
(34
Results of Operations (For the nine months ended September 30)
3,533
4,270
1,927
1,292
1,020
1,092
104
99
113
4,571
5,461
2,147
1,509
216
336
949
808
524
622
120
93
1,019
1,089
101
76
1,106
1,503
225
3,201
3,893
2,581
1,213
1,370
1,568
(434
(61
(6
284
281
(241
(287
Capital Expenditures by Segment
416
457
1,224
1,418
80
454
330
544
538
1,682
1,751
Goodwill, Property, Plant and Equipment and Total Assets by Segment
Property, Plant and Equipment
Total Assets
1,938
11,462
13,263
14,238
16,233
608
2,549
3,891
1,917
131
1,259
1,104
4.
Revenues from Contracts with Customers
The following table summarizes Ovintiv’s revenues from contracts with customers:
Revenues (For the three months ended September 30)
Revenues from Customers
Product revenues (1)
Oil
835
1,135
NGLs
164
180
249
Natural gas
96
221
142
Service revenues
Gathering and processing
1,359
1,759
661
419
838
1,138
567
429
317
205
2,020
2,178
Revenues (For the nine months ended September 30)
2,641
3,508
531
1,093
754
345
215
822
4,553
5,362
2,056
1,396
2,648
3,516
1,624
1,298
1,167
742
6,609
6,758
The Company’s revenues from contracts with customers consists of product sales including oil, NGLs and natural gas, sales of purchased product, as well as the provision of gathering and processing services to third parties. Ovintiv had no contract asset or liability balances during the periods presented. As at September 30, 2025, receivables and accrued revenues from contracts with customers were $758 million ($921 million as at December 31, 2024).
Ovintiv’s product sales are sold under short-term contracts with terms that are less than one year at either fixed or market index prices or under long-term contracts exceeding one year at market index prices at the time of delivery.
The Company’s gathering and processing services are provided on an interruptible basis with transaction prices that are for fixed prices and/or variable consideration. Variable consideration received is related to recovery of plant operating costs or escalation of the fixed price based on a consumer price index. As the service contracts are interruptible, with service provided on an “as available” basis, there are no unsatisfied performance obligations remaining at September 30, 2025.
As at September 30, 2025, all remaining performance obligations are priced at market index prices or are variable volume delivery contracts. As such, the variable consideration is allocated entirely to the wholly unsatisfied performance obligation or promise to deliver units of production, and revenue is recognized at the amount for which the Company has the right to invoice the product delivered. As the period between when the product sales are transferred and Ovintiv receives payments is generally 30 to 60 days, there is no financing element associated with customer contracts. In addition, Ovintiv does not disclose unsatisfied performance obligations for customer contracts with terms less than 12 months or for variable consideration related to unsatisfied performance obligations.
5.
Interest Expense on:
Debt
88
100
276
Finance leases
For the nine months ended September 30, 2025, interest expense on debt includes $5 million of financing fees associated with two term facilities which were terminated in January 2025, following the closing of the Uinta divestiture and the Montney Acquisition as described in Note 8.
6.
Foreign Exchange (Gain) Loss, Net
Unrealized Foreign Exchange (Gain) Loss on:
Translation of U.S. dollar risk management contracts issued from Canada
(87
Translation of intercompany notes
(19
Foreign Exchange (Gain) Loss on Settlements of:
U.S. dollar financing debt issued from Canada
U.S. dollar risk management contracts issued from Canada
98
Intercompany notes
(8
Other Monetary Revaluations
(5
In 2024, the Company entered into $2.4 billion notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.3825 to US$1 to manage the foreign exchange risk associated with the Montney Acquisition, which was denominated in Canadian dollars (see Note 8). In conjunction with the closing of the transaction, the Company settled the currency swaps and recognized a realized foreign exchange loss of approximately $97 million during the nine months ended September 30, 2025.
7.
Income Taxes
Current Tax
United States
40
Canada
45
Total Current Tax Expense (Recovery)
85
Deferred Tax
70
229
124
(40
32
58
Total Deferred Tax Expense (Recovery)
Income Tax Expense (Recovery)
Effective Tax Rate
22.9
%
9.1
25.6
18.4
Ovintiv’s interim income tax expense is determined using the estimated annual effective income tax rate applied to year-to-date net earnings before income tax plus the effect of legislative changes and amounts in respect of prior periods. The estimated annual effective income tax rate is impacted by expected annual earnings, changes in valuation allowances, income tax related to foreign operations, state taxes, the effect of legislative changes, non-taxable items and tax differences on transactions, which can produce interim effective tax rate fluctuations.
The effective tax rate of 22.9 percent for the three months ended September 30, 2025, is higher than the U.S. federal statutory rate of 21 percent primarily due to the impact of state taxes.
The effective tax rate of 25.6 percent for the nine months ended September 30, 2025, is higher than the U.S. federal statutory rate of 21 percent primarily due to the resolution of prior period tax items.
The effective tax rates of 9.1 percent and 18.4 percent for the three and nine months ended September 30, 2024, respectively, were lower than the U.S. federal statutory rate of 21 percent primarily due to changes related to prior year’s tax filings.
8.
Acquisitions and Divestitures
2,275
Total Acquisitions
2,282
Divestitures
(22
Total Divestitures
(26
(1,922
Net Acquisitions & (Divestitures)
(57
195
On January 31, 2025, the Company completed the acquisition of approximately 109,000 net acres in the core of the Montney formation from Paramount Resources Ltd. for total cash consideration, including transaction costs, of approximately $2.274 billion (C$3.280 billion), after preliminary closing adjustments (the “Montney Acquisition”). The Company funded the Montney Acquisition with cash on hand, including proceeds from the Uinta Basin divestiture as discussed below, and proceeds
from short-term borrowings. The Montney Acquisition was accounted for as an asset acquisition as substantially all of the fair value of the assets acquired were concentrated in a single asset group, largely comprising proved oil and natural gas properties. The Company recognized the assets acquired in the Montney Acquisition at the purchase cost, including transaction costs, on a relative fair value basis. The Company recorded $2,292 million in proved properties, $128 million in unproved properties, $146 million related to asset retirement obligations, and $396 million in operating lease assets and lease liabilities related to a long-term midstream agreement for a natural gas processing facility.
For the nine months ended September 30, 2025, acquisitions in the USA operations were $7 million, which primarily include property purchases in Permian with oil and liquids rich potential.
For the nine months ended September 30, 2024, acquisitions in the USA Operations were $197 million, which primarily included property purchases in Permian with oil and liquids-rich potential.
For the nine months ended September 30, 2025, divestitures in the USA Operations were $1,918 million, which primarily included the sale of the Uinta Basin assets located in Utah for proceeds of approximately $1,903 million, after preliminary closing and other adjustments.
Amounts received from the Company’s divestiture transactions have been deducted from the U.S. full cost pool.
9.
Property, Plant and Equipment, Net
As at September 30, 2025
As at December 31, 2024
Accumulated
Cost
DD&A
Net
49,944
(38,876
11,068
50,246
(37,770
12,476
365
741
29
48
46
50,340
(38,878
51,035
(37,772
19,158
(16,738
2,420
15,763
(14,821
942
19,292
(16,743
15,796
(14,826
821
(709
807
(676
USA and Canadian Operations’ property, plant and equipment include internal costs directly related to exploration, development and construction activities of $114 million, which have been capitalized during the nine months ended September 30, 2025 (2024 - $141 million).
For the three months ended September 30, 2025, the Company recognized a before-tax non-cash ceiling test impairment of $141 million (2024 - nil) in the Canadian Operations primarily resulting from the decline in the 12-month average trailing prices, which reduced proved reserves. For the nine months ended September 30, 2025, the Company recognized ceiling test impairments in the Canadian Operations of $871 million (2024 - nil) primarily due to the 12-month average trailing prices used in the ceiling test at March 31, 2025, which were lower than the market prices used for the Montney Acquisition on January 31, 2025. The non-cash impairments are included with accumulated DD&A in the table above.
The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices presented below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.
Oil & NGLs
Natural Gas
Edmonton
WTI
Condensate
Henry Hub
AECO
($/bbl)
(C$/bbl)
($/MMBtu)
(C$/MMBtu)
12-Month Average Trailing Reserves Pricing (1)
September 30, 2025
67.45
93.67
3.10
1.53
December 31, 2024
75.48
99.60
2.13
1.26
September 30, 2024
78.64
102.83
2.21
1.66
10.
Leases
The following table outlines Ovintiv’s estimated future sublease income as at September 30, 2025. All subleases are classified as operating leases.
(undiscounted)
2026
2027
2028
2029
Thereafter
Total
Sublease Income
41
322
506
For the three and nine months ended September 30, 2025, operating lease income was $14 million and $40 million, respectively (2024 - $13 million and $39 million, respectively), and variable lease income was $6 million and $15 million, respectively (2024 - $5 million and $16 million, respectively).
11.
U.S. Dollar Denominated Debt
Revolving credit and term loan borrowings
U.S. Unsecured Notes:
5.65% due May 15, 2025
5.375% due January 1, 2026
459
5.65% due May 15, 2028
700
8.125% due September 15, 2030
300
7.20% due November 1, 2031
350
7.375% due November 1, 2031
500
6.25% due July 15, 2033
6.50% due August 15, 2034
6.625% due August 15, 2037
390
6.50% due February 1, 2038
430
5.15% due November 15, 2041
7.10% due July 15, 2053
400
Total Principal
5,236
5,476
Increase in Value of Debt Acquired
Unamortized Debt Discounts and Issuance Costs
(39
Total Long-Term Debt
5,212
5,453
Current Portion
Long-Term Portion
As at September 30, 2025, the Company had outstanding commercial paper of $360 million maturing at various dates with a weighted average interest rate of approximately 4.84 percent.
As at September 30, 2025, total long-term debt had a carrying value of $5,212 million and a fair value of $5,518 million (as at December 31, 2024 - carrying value of $5,453 million and a fair value of $5,649 million). The estimated fair value of long-term borrowings is categorized within Level 2 of the fair value hierarchy and has been determined based on market information of long-term debt with similar terms and maturity, or by discounting future payments of interest and principal at interest rates expected to be available to the Company at period end.
12.
Finance Lease Obligations
Unrecognized Tax Benefits
Pensions and Other Post-Employment Benefits
Reclamation and Take or Pay Commitments
13.
Share Capital
Authorized
Ovintiv is authorized to issue 750 million shares of common stock, par value $0.01 per share, and 25 million shares of preferred stock, par value $0.01 per share. No shares of preferred stock are outstanding.
Issued and Outstanding
Number
(millions)
Amount
Shares of Common Stock Outstanding, Beginning of Year
260.4
271.7
(7.8
(12.7
Shares of Common Stock Issued
0.7
1.4
Shares of Common Stock Outstanding, End of Period
253.3
Ovintiv’s Performance Share Units (“PSU”) and Restricted Share Units (“RSU”) stock-based compensation plans allow the Company to settle the awards either in cash or in the Company’s common stock. Accordingly, Ovintiv issued 0.7 million shares of common stock during the nine months ended September 30, 2025 (1.4 million shares of common stock during the twelve months ended December 31, 2024), as certain PSU and RSU grants vested during the period.
Normal Course Issuer Bid
On September 29, 2025, the Company announced it had received regulatory approval for the renewal of its NCIB program, which enables the Company to purchase, for cancellation or return to treasury, up to approximately 22.3 million shares of common stock over a 12-month period from October 3, 2025, to October 2, 2026.
During the three and nine months ended September 30, 2025, the Company purchased approximately 3.7 million shares and 7.8 million shares, respectively, under its 2024 NCIB program, which extended from October 3, 2024, to October 2, 2025, for total consideration of approximately $160 million and $307 million, respectively. Of the amounts paid during the same three and nine month periods, $37 thousand and $78 thousand, respectively, were charged to share capital and $160 million and $307 million, respectively, were charged to paid in surplus.
During the three and nine months ended September 30, 2024, the Company purchased approximately 3.7 million shares and 12.7 million shares, respectively, under its 2023 NCIB program which extended from October 3, 2023, to October 2, 2024, for total consideration of approximately $163 million and $597 million, respectively. Of the amounts paid during the same three and nine month periods, $37 thousand and $127 thousand, respectively, were charged to share capital and $163 million and $597 million, respectively, were charged to paid in surplus.
For the twelve months ended December 31, 2024, the Company purchased approximately 12.7 million shares under its 2023 NCIB program for total consideration of approximately $597 million, of which $127 thousand was charged to share capital and $597 million was charged to paid in surplus.
All NCIB purchases were made in accordance with their respective programs at prevailing market prices plus brokerage fees, with consideration allocated to share capital up to the par value of the shares, with any excess allocated to paid in surplus.
Dividends
During the three months ended September 30, 2025, the Company declared and paid dividends of $0.30 per share of common stock totaling $77 million (2024 - $0.30 per share of common stock totaling $78 million).
During the nine months ended September 30, 2025, the Company declared and paid dividends of $0.90 per share of common stock totaling $232 million (2024 - $0.90 per share of common stock totaling $238 million).
On November 4, 2025, the Board of Directors declared a dividend of $0.30 per share of common stock payable on December 31, 2025, to shareholders of record as of December 15, 2025.
Earnings Per Share of Common Stock
The following table presents the calculation of net earnings (loss) per share of common stock:
Number of Shares of Common Stock:
Weighted average shares of common stock outstanding - Basic
Effect of dilutive securities
1.9
2.2
2.7
Weighted Average Shares of Common Stock Outstanding - Diluted
Stock-Based Compensation Plans
Shares issued as a result of awards granted from stock-based compensation plans are generally funded out of the common stock authorized for issuance as approved by the Company’s shareholders. As at September 30, 2025, the Company has sufficient common stock held in reserve for issuance in accordance with its equity-settled stock-based compensation plans.
14.
Accumulated Other Comprehensive Income
Foreign Currency Translation Adjustment
Balance, Beginning of Period
933
893
731
1,000
Change in Foreign Currency Translation Adjustment
Balance, End of Period
860
937
Pension and Other Post-Employment Benefit Plans
47
Amounts Reclassified from Other Comprehensive Income:
Reclassification of net actuarial (gains) and losses to net earnings
Income taxes
Total Accumulated Other Comprehensive Income
15.
Variable Interest Entities
Veresen Midstream Limited Partnership
Veresen Midstream Limited Partnership (“VMLP”) provides gathering, compression and processing services under various agreements related to the Company’s development of liquids and natural gas production in the Montney play. As at September 30, 2025, VMLP provides approximately 1,152 MMcf/d of natural gas gathering and compression and 913 MMcf/d of natural gas processing under long-term service agreements with remaining terms ranging from six to 20 years and have various renewal terms providing up to a potential maximum of 10 years.
Ovintiv has determined that VMLP is a variable interest entity and that Ovintiv holds variable interests in VMLP. Ovintiv is not the primary beneficiary as the Company does not have the power to direct the activities that most significantly impact VMLP’s economic performance. These key activities relate to the construction, operation, maintenance and marketing of the assets owned by VMLP. The variable interests arise from certain terms under the various long-term service agreements and include: i) a take or pay for volumes in certain agreements; ii) an operating fee of which a portion can be converted into a fixed fee once VMLP assumes operatorship of certain assets; and iii) a potential payout of minimum costs in certain agreements. The potential payout of minimum costs will be assessed in the eighth year of the assets’ service period and is based on whether there is an overall shortfall of total system cash flows from natural gas gathered and compressed under certain agreements. The potential payout amount can be reduced in the event VMLP markets unutilized capacity to third-party users. Ovintiv is not required to provide any financial support or guarantees to VMLP.
As a result of Ovintiv’s involvement with VMLP, the maximum total exposure to loss related to the commitments under the agreements is estimated to be $815 million as at September 30, 2025. The estimate comprises the take or pay volume commitments and the potential payout of minimum costs. The take or pay volume commitments associated with certain gathering and processing assets are included in Note 21 under Transportation and Processing. The potential payout requirement is highly uncertain as the amount is contingent on future production estimates, pace of development and downstream transportation constraints. As at September 30, 2025, other liabilities and provisions included $30 million related to the take or pay commitment and payout of minimum costs.
16.
Restructuring Charges
In 2024, Ovintiv undertook a plan to reduce its workforce by approximately 10 percent as part of a corporate reorganization. During the three and nine months ended September 30, 2025, the Company incurred restructuring charges of nil and $11 million, respectively, before tax, related to severance costs (2024 - nil, respectively). Of the $38 million in restructuring charges incurred to date, $1 million remains accrued as at September 30, 2025 ($19 million as at December 31, 2024). The remaining amount accrued is expected to be paid in 2026.
Restructuring charges are included in administrative expense presented in the Corporate and Other segment in the Condensed Consolidated Statement of Earnings.
Severance and Outplacement
Restructuring Expenses
Outstanding Restructuring Accrual, Beginning of Year
Restructuring Expenses Incurred
27
Restructuring Costs Paid
Outstanding Restructuring Accrual, End of Period (1)
17.
Compensation Plans
As at September 30, 2025, the Company has sufficient common stock held in reserve for issuance in accordance with its equity-settled stock-based compensation plans.
The Company has recognized the following share-based compensation costs:
Total Compensation Costs of Transactions Classified as Cash-Settled
Total Compensation Costs of Transactions Classified as Equity-Settled
71
Less: Total Share-Based Compensation Costs Capitalized
(15
Total Share-Based Compensation Expense (Recovery)
Recognized in the Condensed Consolidated Statement of Earnings in:
As at September 30, 2025, the liability for cash-settled share-based payment transactions totaled $8 million ($10 million as at December 31, 2024), which is recognized in accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheet.
24
The following weighted average assumptions were used to determine the fair value of Stock Appreciation Rights (“SAR”) and Tandem Stock Appreciation Rights (“TSAR”) units outstanding:
As at September 30, 2024
US$ SAR
C$ TSAR
Share Units
Risk Free Interest Rate
2.47%
3.01%
Dividend Yield
2.97%
2.99%
3.13%
3.15%
Expected Volatility Rate (1)
41.03%
39.33%
47.74%
44.43%
Expected Term
0.4 yrs
1.1 yrs
Market Share Price
US$40.38
C$56.19
US$38.31
C$51.84
Weighted Average Grant Date Fair Value
US$33.53
C$46.55
US$40.91
C$54.84
The following units were granted primarily in conjunction with the Company’s annual grant of long-term incentive awards. The PSUs and RSUs were granted at the volume-weighted average trading price of shares of Ovintiv common stock for the five days prior to the grant date.
Nine Months Ended September 30, 2025 (thousands of units)
RSUs
1,676
PSUs
604
DSUs (1)
18.
Fair Value Measurements
The fair values of cash and cash equivalents, accounts receivable and accrued revenues, and accounts payable and accrued liabilities approximate their carrying amounts due to the short-term maturity of those instruments. The fair values of restricted cash and marketable securities included in other assets approximate their carrying amounts due to the nature of the instruments held.
Recurring fair value measurements are performed for risk management assets and liabilities, and other derivative contracts, as discussed further in Note 19. These items are carried at fair value in the Condensed Consolidated Balance Sheet and are classified within the three levels of the fair value hierarchy in the following tables.
Fair value changes and settlements for amounts related to risk management assets and liabilities are recognized in revenues and foreign exchange gains and losses according to their purpose.
Level 1QuotedPrices inActiveMarkets
Level 2 OtherObservableInputs
Level 3SignificantUnobservableInputs
Total FairValue
Netting (1)
CarryingAmount
Risk Management Assets
Commodity Derivatives:
Current assets
75
Long-term assets
Risk Management Liabilities
Long-term liabilities
116
110
Foreign Currency Derivatives:
Current liabilities
89
87
The Company’s Level 1 and Level 2 risk management assets and liabilities include contracts with terms to 2028, consisting of commodity fixed price contracts, three-way options, basis swaps, physical forward contracts receiving a percentage of the Japan Korea Marker (“JKM”) index price and foreign currency swaps. The Company uses discounted cash flow and option-pricing models for fair valuing commodity derivatives. The fair value models use inputs such as contracted notional volumes, market future prices, maturities, credit adjusted risk free rates, and market-based implied volatility factors. The fair values of these contracts are estimated using inputs which are either directly or indirectly observable from active markets, such as exchange and other published prices, broker quotes and observable trading activity throughout the term of the instruments.
The three-way options are a combination of a sold call, a bought put and a sold put. These contracts allow the Company to participate in the upside of commodity prices to the ceiling of the call option and provide the Company with partial downside price protection through the put options.
During the third quarter of 2024, the Company transferred its WTI three-way options from Level 3 into Level 2 as a result of the availability of more observable inputs, such as volatility and comparable contract terms, from independent active markets.
Level 3 Fair Value Measurements
During the second quarter of 2025, Ovintiv entered into a ten-year physical forward contract, with terms to 2037, to deliver 100 MMcf/d of natural gas volumes with a delivery point in Alberta and will receive the Chicago city-gates (“Chicago”) index price, less deducts. Delivery of natural gas volumes is expected to commence November 1, 2027. This contract is a derivative and is required to be measured at fair value each reporting period with changes in the fair value recorded in net earnings. The fair value of this contract is based on the discounted cash flow model using observable and unobservable inputs such as forward prices less deducts. The data used to develop the unobservable inputs are obtained from third parties whenever possible and reviewed by the Company for reasonableness.
A summary of changes in Level 3 fair value measurements for risk management positions is presented below:
Balance, Beginning of Year
Total Gains (Losses)
Purchases, Sales, Issuances and Settlements:
Purchases, sales and issuances
Settlements
Transfers Out of Level 3
Change in Unrealized Gains (Losses) During the
Period Included in Net Earnings (Loss)
Quantitative information about unobservable inputs used in Level 3 fair value measurements is presented below as at September 30, 2025:
Valuation Technique
Unobservable Inputs
Range
Weighted Average
Risk Management - Physical Forward Contract
Discounted Cash Flow Model
Forward Prices (1)
$0.58/Mcf - $2.59/Mcf
$1.12/Mcf
A 10 percent increase or decrease in forward price differentials between Chicago and AECO for the physical forward contract would cause an approximate corresponding $24 million (nil as at December 31, 2024) increase or decrease to net risk management assets and liabilities.
19.
Financial Instruments and Risk Management
A) Financial Instruments
Ovintiv’s financial assets and liabilities are recognized in cash and cash equivalents, accounts receivable and accrued revenues, other assets, accounts payable and accrued liabilities, risk management assets and liabilities, long-term debt, and other liabilities and provisions.
B) Risk Management Activities
Ovintiv uses derivative financial instruments to manage its exposure to fluctuating commodity prices and foreign currency exchange rates. The Company does not apply hedge accounting to any of its derivative financial instruments. As a result, gains and losses from changes in the fair value are recognized in net earnings (loss).
Commodity Price Risk
Commodity price risk arises from the effect that fluctuations in future commodity prices may have on revenues from production. To partially mitigate exposure to commodity price risk, the Company has entered into various derivative financial instruments. The use of these derivative instruments is governed under formal policies and is subject to limits established by the Board of Directors.
Oil and NGLs - To partially mitigate oil and NGL commodity price risk, the Company uses WTI- and NGL-based contracts such as fixed price contracts and options.
Natural Gas - To partially mitigate natural gas commodity price risk, the Company uses NYMEX- and AECO- based contracts such as fixed price contracts and options. Ovintiv has also entered into forward contracts to partially manage against widening price differentials between various production areas and benchmark price points.
Foreign Exchange Risk
Foreign exchange risk arises from changes in foreign currency exchange rates that may affect the fair value or future cash flows from the Company’s financial assets or liabilities. To partially mitigate the effect of foreign exchange fluctuations on future commodity revenues and expenses, the Company may enter into foreign currency derivative contracts from time to time. As at September 30, 2025, the Company does not have any notional U.S. dollar denominated currency swaps.
Risk Management Positions as at September 30, 2025
Notional Volumes
Term
Average Price
Fair Value
Oil and NGL Contracts
US$/bbl
Fixed Price Contracts
Propane Fixed Price
10.0 Mbbls/d
31.83
WTI Three-Way Options
Sold call / bought put / sold put
50.0 Mbbls/d
76.57 / 65.00 / 50.00
28.6 Mbbls/d
71.44 / 61.30 / 51.08
Oil and NGLs Fair Value Position
Natural Gas Contracts
US$/Mcf
AECO Fixed Price
50 MMcf/d
2.35
NYMEX Three-Way Options
500 MMcf/d
4.47 / 3.00 / 2.25
462 MMcf/d
6.46 / 3.33 / 2.61
Basis Contracts (1)
Other Financial Positions
2025 - 2026
Physical Forward Contracts (2)
2026 - 2037
Natural Gas Fair Value Position
Total Fair Value Position
57
Earnings Impact of Realized and Unrealized Gains (Losses) on Risk Management Positions
Realized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (1)
212
Foreign exchange (2)
(98
211
Unrealized Gains (Losses) on Risk Management
Revenues (3)
Foreign exchange
(70
Total Realized and Unrealized Gains (Losses) on Risk Management, net
Revenues (1) (3)
(10
Reconciliation of Unrealized Risk Management Positions from January 1 to September 30
TotalUnrealizedGain (Loss)
Fair Value of Contracts, Beginning of Year
Change in Fair Value of Contracts in Place at Beginning of Year
and Contracts Entered into During the Period
Fair Value of Contracts Realized During the Period
(211
Fair Value of Contracts, End of Period
Risk management assets and liabilities arise from the use of derivative financial instruments and are measured at fair value. See Note 18 for a discussion of fair value measurements.
Unrealized Risk Management Positions
Current
Long-term
79
Net Risk Management Assets (Liabilities)
C) Credit Risk
Credit risk arises from the potential that the Company may incur a loss if a counterparty to a financial instrument fails to meet its obligation in accordance with agreed terms. While exchange-traded contracts are subject to nominal credit risk due to the financial safeguards established by the exchanges and clearing agencies, over-the-counter traded contracts expose Ovintiv to counterparty credit risk. Counterparties to the Company’s derivative financial instruments consist primarily of major financial institutions and companies within the energy industry. This credit risk exposure is mitigated through the use of credit policies approved by the Board of Directors governing the Company’s credit portfolio including credit practices that limit transactions according to counterparties’ credit quality. Mitigation strategies may include master netting arrangements, requesting collateral, purchasing credit insurance and/or transacting credit derivatives. The Company executes commodity derivative financial instruments under master agreements that have netting provisions that provide for offsetting payables against receivables. Ovintiv actively evaluates the creditworthiness of its counterparties, assigns appropriate credit limits and monitors credit exposures against those assigned limits. As at September 30, 2025, Ovintiv’s maximum exposure of loss due to credit risk from derivative financial instrument assets on a gross and net fair value basis was $79 million and $79 million, respectively, as disclosed in Note 18. The Company had no significant credit derivatives in place and held no collateral at September 30, 2025.
Any cash equivalents include high-grade, short-term securities, placed primarily with financial institutions with investment grade ratings. Any foreign currency agreements entered into are with major financial institutions that have investment grade credit ratings.
A substantial portion of the Company’s accounts receivable are with customers and working interest owners in the oil and gas industry and are subject to normal industry credit risks. As at September 30, 2025, approximately 95 percent (94 percent as at December 31, 2024) of Ovintiv’s accounts receivable and financial derivative credit exposures were with investment grade counterparties.
20.
Supplementary Information
Supplemental disclosures to the Condensed Consolidated Statement of Cash Flows are presented below:
Accounts receivable and accrued revenues
68
134
303
(144
(64
(269
(365
Income tax receivable and payable
(239
Non-Cash Operating Activities
ROU operating lease assets and liabilities
Non-Cash Investing Activities
Property, plant and equipment accruals
(23
(25
Capitalized long-term incentives
Property additions/dispositions, including swaps
21.
Commitments
The following table outlines the Company’s commitments as at September 30, 2025:
Expected Future Payments
Transportation and Processing
784
669
514
431
1,836
4,429
Drilling and Field Services
189
Building Leases & Other Commitments
271
907
676
520
435
1,847
4,656
Operating leases with terms greater than one year are not included in the commitments table above. The table above includes short-term leases with contract terms less than 12 months, such as drilling rigs and field office leases, as well as non-lease operating cost components associated with building leases.
Included within transportation and processing in the table above are certain commitments associated with midstream service agreements with VMLP as described in Note 15. Divestiture transactions can reduce certain commitments disclosed above.
Contingencies
Ovintiv is involved in various legal claims and actions arising in the normal course of the Company’s operations. Although the outcome of these claims cannot be predicted with certainty, the Company does not expect these matters to have a material adverse effect on Ovintiv’s financial position, cash flows or results of operations. Management’s assessment of these matters may change in the future as these matters are subject to a number of uncertainties. For any material matters that the Company believes an unfavorable outcome is reasonably possible, the Company discloses the nature and a range of potential exposures, if reasonably estimable. If an unfavorable outcome were to occur, there exists the possibility of a material impact on the Company’s consolidated net earnings or loss for the period in which the effect becomes reasonably estimable. The Company accrues for such items when a liability is both probable and the amount can be reasonably estimated. Such accruals are based on the Company’s information known about the matters, estimates of the outcomes of such matters and experience in handling similar matters.
22.
Subsequent Event
Agreement to Acquire NuVista Energy Ltd.
On November 4, 2025, Ovintiv announced it has entered into a definitive agreement to acquire all of the issued and outstanding common shares of NuVista Energy Ltd. (“NuVista”) in a cash and stock transaction valued at approximately $2.7 billion (C$3.8 billion), inclusive of assumed debt. The transaction value includes Ovintiv’s purchase of 18.5 million common shares of NuVista for $212 million (C$296 million), which closed on October 1, 2025. Under the terms of the arrangement agreement, Ovintiv will acquire all of the remaining issued and outstanding common shares of NuVista for C$18.00 per share, which will be paid 50 percent in cash and 50 percent in Ovintiv common stock, totaling approximately $1.1 billion and 30 million shares, respectively. The transaction has been unanimously approved by the Board of Directors of both Ovintiv and NuVista and is expected to close by the end of the first quarter of 2026 subject to NuVista shareholder, court and other customary approvals.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The MD&A is intended to provide a narrative description of the Company’s business from management’s perspective, which includes an overview of Ovintiv’s condensed consolidated results for the three and nine months ended September 30, 2025, and period-over-period comparison. This MD&A should be read in conjunction with the unaudited interim Condensed Consolidated Financial Statements and accompanying notes for the period ended September 30, 2025 (“Consolidated Financial Statements”), which are included in Part I, Item 1 of this Quarterly Report on Form 10-Q and the audited Consolidated Financial Statements and accompanying notes and MD&A for the year ended December 31, 2024, which are included in Items 8 and 7, respectively, of the 2024 Annual Report on Form 10‑K.
Common industry terms and abbreviations are used throughout this MD&A and are defined in the Definitions, Conversions and Conventions sections of this Quarterly Report on Form 10-Q. This MD&A includes the following sections:
Executive Overview
Strategy
Ovintiv aims to be a leading North American energy producer and is focused on developing its high-quality multi-basin portfolio of oil and natural gas producing plays. Ovintiv is committed to delivering quality returns from its capital investment, generating significant cash flows and providing durable cash returns to its shareholders through the commodity price cycle. The Company aims to achieve its strategic priorities through execution excellence, disciplined capital allocation, and commercial acumen and risk management. In addition, the Company is dedicated to driving progress in areas of environmental, social, and governance, aligning with its commitment to corporate responsibility.
In support of the Company’s commitment to enhancing shareholder value, Ovintiv utilizes its capital allocation framework to provide competitive returns to shareholders while strengthening its balance sheet.
Ovintiv continually monitors and evaluates changing market conditions to maximize cash flows, mitigate risks and renew its premium well inventory. The Company’s high-quality assets, located in the United States and Canada, form a multi-basin, multi-product portfolio which enables flexible and efficient investment of capital that supports the Company’s strategy.
Ovintiv seeks to deliver results in a socially and environmentally responsible manner. Best practices are deployed across its assets, allowing the Company to capitalize on operational efficiencies and decrease emissions intensity. The Company’s sustainability reporting, which outlines its key metrics, targets and relative progress achieved, can be found in the Company Outlook section of this MD&A and on the Company’s sustainability website.
Underpinning Ovintiv’s strategy are core values of one, agile, innovative and driven, which guide the organization to be collaborative, responsive, flexible and determined. The Company is committed to excellence with a passion to drive corporate financial performance and shareholder value.
For additional information on Ovintiv’s strategy, its reporting segments and the plays in which the Company operates, refer to Items 1 and 2 of the 2024 Annual Report on Form 10-K.
In evaluating its operations and assessing its leverage, Ovintiv reviews performance-based measures such as Non‑GAAP Cash Flow and debt-based metrics such as Debt to Adjusted Capitalization, Debt to EBITDA and Debt to Adjusted EBITDA, which are non-GAAP measures and do not have any standardized meaning under U.S. GAAP. These measures may not be similar to measures presented by other issuers and should not be viewed as a substitute for measures reported under U.S. GAAP. Additional information regarding these measures, including reconciliations to the closest GAAP measure, can be found in the Non-GAAP Measures section of this MD&A.
Highlights
During the first nine months of 2025, the Company focused on executing its 2025 capital investment plan aimed at maximizing profitability through operational and capital efficiencies, and delivering cash from operating activities. In conjunction with closing the Montney Acquisition, as discussed below, the Company has fully integrated the new assets into its existing operations.
Lower upstream product revenues in the first nine months of 2025 compared to 2024, primarily resulted from lower oil production volumes and lower average realized oil and plant condensate prices, excluding the impact of risk management activities, partially offset by higher plant condensate production volumes and higher average realized natural gas prices, excluding the impact of risk management activities. Oil production volumes decreased primarily as a result of the sale of the Company’s Uinta assets in the first quarter of 2025. Average realized oil and plant condensate prices decreased 11 percent and 10 percent, respectively, primarily due to lower benchmark prices. Plant condensate production volumes increased due to the Montney Acquisition in the first quarter of 2025. Higher average realized natural gas prices of 46 percent were primarily due to higher benchmark prices and exposure to other downstream benchmark prices. Ovintiv continues to focus on optimizing realized prices from the diversification of the Company’s downstream markets.
Significant Developments and Subsequent Events
35
Financial Results
Three months ended September 30, 2025
Nine months ended September 30, 2025
Capital Investment
During the nine months ended September 30, 2025
Production
Additional information on the items above and other expenses can be found in the Results of Operations section of this MD&A.
In 2024, Ovintiv reassessed its reportable segments and reclassified its Market Optimization segment to present the Company’s market optimization activities in their respective USA and Canadian operating segments, which they support (“Segment Reclassification”). Additional information on the Segment Reclassification can be found in Note 3 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
2025 Outlook
Industry Outlook
Oil and Natural Gas Markets
The oil and gas industry is cyclical and commodity prices are inherently volatile. Oil prices reflect global supply and demand dynamics as well as the geopolitical and macroeconomic environment.
Oil prices for the remainder of 2025 are expected to be impacted by the interplay between the pace of global economic growth and demand for oil, OPEC+ and non-OPEC+ production levels, and continued price volatility resulting from geopolitical events and macroeconomic uncertainties. Supply and the accumulation of global oil inventories are expected to be impacted by changes in geopolitical volatility, OPEC+ and non-OPEC+ production levels, and consumer demand behavior.
Natural gas prices are primarily impacted by structural changes in supply and demand, deviations from seasonally normal weather, as well as volatility in regional markets.
Natural gas prices for the remainder of 2025 are expected to be impacted by the interplay between natural gas production and associated natural gas from oil production, changes in demand from the power generation sector, changes in export levels of U.S. and Canadian liquefied natural gas, impacts from seasonal weather, as well as supply chain constraints or other disruptions resulting from geopolitical events.
Political developments, including trade disputes and policy changes, continue to elevate global uncertainty and financial market volatility. U.S. sanctions and tariffs on select products may disrupt global supply and demand, leading to commodity price volatility. These actions can provoke retaliatory measures from other countries, further increasing economic volatility and the risk of a global recession.
Company Outlook
The Company will continue to exercise discretion and discipline, and intends to optimize capital allocation through the remainder of 2025 as the commodity price environment evolves. Ovintiv pursues innovative ways to maximize cash flows and reduce operating and administrative expenses.
Markets for oil and natural gas are exposed to different price risks and are inherently volatile. The Company enters into derivative financial instruments to mitigate price volatility and provide more certainty around cash flows. As at September 30, 2025, the Company has hedged approximately 50.0 Mbbls/d of expected oil and condensate production and 500 MMcf/d of expected natural gas production for the remainder of the year. In addition, Ovintiv proactively utilizes commodity derivatives and transportation contracts to diversify the Company’s sales markets, thereby reducing significant exposure to any given market and regional pricing.
Additional information on Ovintiv’s hedging program can be found in Note 19 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
The Company continues to execute its 2025 capital investment program, focusing on maximizing returns from high-margin oil and condensate, and generating cash flows in excess of capital expenditures.
During the third quarter of 2025, the Company invested $544 million, which was in line with its third quarter guidance of $525 million to $575 million. The Company expects to meet its full year 2025 capital investment guidance range of $2,125 million to $2,175 million.
Ovintiv continually strives to improve well performance and lower costs through innovative techniques. Ovintiv’s large-scale cube development model utilizes multi-well pads and advanced completion designs to maximize returns and resource recovery from its reservoirs. Ovintiv’s disciplined capital program and continuous innovation create flexibility to allocate capital in changing commodity markets to maximize cash flows while preserving the long-term value of the Company’s multi-basin portfolio.
During the third quarter of 2025, total average production volumes were 630.4 MBOE/d, which exceeded the third quarter guidance range of 610.0 MBOE/d to 630.0 MBOE/d. Average oil and plant condensate production volumes were 211.8 Mbbls/d, which exceeded the third quarter guidance range of 202.0 Mbbls/d to 208.0 Mbbls/d. Average other NGL production volumes were 97.7 Mbbls/d and average natural gas production volumes were 1,925 MMcf/d, which were at the high end of their third quarter guidance ranges of 94.0 Mbbls/d to 98.0 Mbbls/d and 1,875 MMcf/d to 1,925 MMcf/d, respectively.
The Company expects to meet its updated full year 2025 total production guidance range of 610.0 MBOE/d to 620.0 MBOE/d, including oil and plant condensate production volumes of approximately 208.0 Mbbls/d to 210.0 Mbbls/d, other NGLs production volumes of approximately 94.0 Mbbls/d to 96.0 Mbbls/d and natural gas production volumes of approximately 1,850 MMcf/d to 1,870 MMcf/d.
Ovintiv promotes a collaborative culture that values knowledge exchange, open communication, continuous improvement and learning. This culture stimulates innovation and fosters the creation of best practices resulting in efficiency improvements and enhanced operational performance for the Company.
The Company is on track to achieve its full year upstream transportation and processing guidance range of approximately $7.50 per BOE to $8.00 per BOE, upstream operating expenses of approximately $3.75 per BOE to $4.00 per BOE for the remainder of the year and total production, mineral and other taxes of approximately 3.75 to 4.50 percent of upstream product revenues.
Additional information on Ovintiv’s fourth quarter and updated full year 2025 Corporate Guidance can be accessed on the Company’s website at www.ovintiv.com.
Environmental, Social and Governance
Ovintiv recognizes the importance of implementing and maintaining sustainable practices to reduce its environmental footprint. The Company voluntarily participates in emission reduction programs and has adopted a range of strategies to help reduce emissions from its operations. These strategies include incorporating new and proven technologies, optimizing processes in its operations and working closely with third-party providers to develop best practices. The Company continues to look for innovative techniques and efficiencies in support of its commitment to emission reductions.
In May 2025, Ovintiv published its 2024 Sustainability Report. The report highlights the Company’s 2024 environmental, social and governance results, and its progress in emissions intensity reductions with the goal to meet its Scope 1&2 GHG emissions target by 2030. As at the end of 2024, the Company had achieved a greater than 45 percent reduction in the Scope 1&2 GHG emissions intensity from 2019 levels and expects to meet its emissions intensity reduction target of 50 percent by 2030 measured against the 2019 baseline. Ovintiv remains committed to its GHG emissions reduction target and has tied the target to the Company’s annual compensation program for all employees. In addition, Ovintiv continues to work towards eliminating routine flaring in its operations.
In conjunction with the Company’s strategy, Ovintiv may acquire assets to strengthen its multi-basin portfolio. Acquisitions are thoroughly assessed and evaluated for environmental impacts and alignment with the Company’s GHG emissions target. Ovintiv continues to work to integrate sustainable practices within the acquired operations to support company-wide sustainability objectives.
The Company’s social commitment framework, which is rooted in the Company’s foundational values of integrity, safety, sustainability, trust and respect, reflects Ovintiv’s positive contributions to the communities where it operates and highlights the Company’s approach to enabling an inclusive culture.
Ovintiv remains committed to protecting the health and safety of its workforce. Safety is a foundational value at Ovintiv and plays a critical role in the Company’s belief that a safe workplace is a strong indicator of a well-managed business. This safety-oriented mindset enables the Company to quickly respond to emergencies and minimize any impacts to employees and business continuity. Safety performance goals are incorporated into the Company’s annual compensation program. Additional information on talent management and employee safety can be found in the Human Capital section of Items 1 and 2 of the 2024 Annual Report on Form 10-K.
Additional information on Ovintiv’s sustainable business practices are included in its most recent Sustainability Report on the Company’s sustainability website at sustainability.ovintiv.com.
39
Results of Operations
Selected Financial Information
Three months ended September 30,
Nine months ended September 30,
($ millions)
Product and Service Revenues
Upstream product revenues (1)
1,722
1,772
5,439
5,556
Service revenues (2)
Total Product and Service Revenues
Sales of Purchased Product (1)
Gains (Losses) on Risk Management, Net
Sublease Revenues
Total Operating Expenses (3)
Ovintiv’s revenues are substantially derived from sales of oil, NGLs and natural gas production. Increases or decreases in Ovintiv’s revenue, profitability and future production are highly dependent on the commodity prices the Company receives. Prices are market driven and fluctuate due to factors beyond the Company’s control, such as supply and demand, seasonality and geopolitical and economic factors. The Company’s realized prices generally reflect WTI, NYMEX, Edmonton Condensate and AECO benchmark prices, as well as other downstream benchmarks, including Houston and Dawn. The Company proactively mitigates price risk and optimizes margins by entering into firm transportation contracts to diversify market access to different sales points. Realized prices, excluding the impact of risk management activities, may differ from the benchmarks for many reasons, including quality, location, or production being sold at different market hubs.
Benchmark prices relevant to the Company are shown in the table below.
Benchmark Prices
(average for the period)
WTI ($/bbl)
64.93
75.09
66.70
77.54
Houston ($/bbl)
65.61
76.29
67.74
79.11
Edmonton Condensate (C$/bbl)
86.87
97.41
91.89
100.68
NYMEX ($/MMBtu)
3.07
2.16
3.39
2.10
AECO (C$/Mcf)
1.00
0.81
1.70
1.43
Dawn (C$/MMBtu)
3.83
2.32
4.49
2.67
Production Volumes and Realized Prices
Production Volumes (1)
Realized Prices (2)
Oil (Mbbls/d, $/bbl)
137.0
168.0
66.23
73.23
142.9
168.3
67.59
75.86
0.6
0.4
64.35
71.07
65.37
72.90
137.6
168.4
66.22
143.3
168.7
67.58
75.85
NGLs - Plant Condensate (Mbbls/d, $/bbl)
11.7
49.67
56.73
11.1
52.69
58.01
62.5
32.3
62.81
71.13
55.2
31.9
64.19
72.88
74.2
44.0
60.73
67.30
66.3
43.0
62.26
69.05
NGLs - Other (Mbbls/d, $/bbl)
77.9
77.7
15.46
16.44
75.1
76.0
18.10
17.52
19.8
14.9
22.62
26.97
18.9
15.0
24.24
27.35
97.7
92.6
16.91
18.13
94.0
91.0
19.34
19.14
Total Oil & NGLs (Mbbls/d, $/bbl)
226.6
257.4
47.92
55.35
229.1
255.4
50.66
57.72
82.9
47.6
53.24
57.34
74.5
47.3
54.05
58.46
309.5
305.0
49.34
55.66
303.6
302.7
51.49
57.84
Natural Gas (MMcf/d, $/Mcf)
512
543
2.04
1.29
510
533
2.48
1.49
1,413
1,182
1,337
1,171
2.25
1.63
1,925
1,725
1.79
1,704
1.59
Total Production (MBOE/d, $/BOE)
311.9
348.0
38.17
42.97
314.2
344.3
40.99
45.12
318.5
244.6
21.39
17.39
297.3
242.4
23.66
19.29
630.4
592.6
29.69
32.41
611.5
586.7
32.57
34.45
Production Mix (%)
Oil & Plant Condensate
NGLs - Other
Total Oil & NGLs
52
Production Change
Period Over Period (%) (3)
Total Production
Upstream Product Revenues, Excluding Realized Gains (Losses) on Risk Management
NGLs - Plant Condensate
2024 Upstream Product Revenues (1)
274
155
Increase (decrease) due to:
Sales prices
(92
Production volumes
(208
198
2025 Upstream Product Revenues
415
152
479
(328
(154
363
(124
(540
462
1,127
497
Oil Revenues
Three months ended September 30, 2025 versus September 30, 2024
Oil revenues were lower by $300 million compared to the third quarter of 2024 primarily due to:
Nine months ended September 30, 2025 versus September 30, 2024
Oil revenues were lower by $868 million compared to the first nine months of 2024 primarily due to:
NGL Revenues
NGL revenues were higher by $138 million compared to the third quarter of 2024 primarily due to:
NGL revenues were higher by $326 million compared to the first nine months of 2024 primarily due to:
Natural Gas Revenues
Natural gas revenues were higher by $112 million compared to the third quarter of 2024 primarily due to:
Natural gas revenues were higher by $425 million compared to the first nine months of 2024 primarily due to:
Sales of Purchased Product
Revenues from the sale of purchased product relate to activities that provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification within the USA and Canadian Operations segments.
2024 (1)
Sales of purchased product revenues decreased $114 million compared to the third quarter of 2024 primarily due to:
partially offset by:
Sales of purchased product revenues decreased $47 million compared to the first nine months of 2024 primarily due to:
As a means of managing commodity price volatility, Ovintiv enters into commodity derivative financial instruments on a portion of its expected oil, NGLs and natural gas production volumes. Additional information on the Company’s commodity price positions as at September 30, 2025, can be found in Note 19 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
The following tables provide the effects of the Company’s risk management activities on revenues.
Commodity Price
(33
95
237
Other (1)
Total Gains (Losses) on Risk Management, Net
(Per-unit)
Oil ($/bbl)
0.29
0.34
(0.70
NGLs - Other ($/bbl)
0.31
0.20
0.12
0.15
Natural Gas ($/Mcf)
0.22
0.59
0.18
0.50
Total ($/BOE)
0.79
1.76
0.65
Ovintiv recognizes fair value changes from its risk management activities each reporting period. The changes in fair value result from new positions and settlements that occur during each period, as well as the relationship between contract prices and the associated forward curves. Realized gains or losses on risk management activities related to commodity price mitigation are included in the USA and Canadian Operations’ revenues as the contracts are cash settled. Unrealized gains or losses on fair value changes of unsettled contracts are included in the Corporate and Other segment.
During the second and third quarters of 2025, the Company entered into physical forward contracts to further mitigate a portion of its exposure to AECO benchmark prices. The Company’s ongoing market diversification strategy shifts a portion of its commodity price exposure to alternative pricing hubs including Japan Korea Marker and Chicago city-gates, commencing in 2026 and 2027, respectively.
Additional information on fair value changes and risk management contracts can be found in Notes 18 and 19, respectively, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Sublease revenues primarily include amounts related to the sublease of office space in The Bow office building recorded in the Corporate and Other segment. Additional information on office sublease income can be found in Note 10 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Production, Mineral and Other Taxes
Production, mineral and other taxes include production and property taxes. Production taxes are generally assessed as a percentage of oil, NGLs and natural gas production revenues. Property taxes are generally assessed based on the value of the underlying assets.
($/BOE)
2.29
2.55
2.52
2.62
0.19
0.17
1.24
1.56
1.39
1.60
Production, mineral and other taxes decreased $14 million compared to the third quarter of 2024 primarily due to:
Production, mineral and other taxes decreased $26 million compared to the first nine months of 2024 primarily due to:
Transportation and processing expense includes transportation costs incurred to move product from production points to sales points including gathering, compression, pipeline tariffs, trucking and storage costs. Ovintiv also incurs costs related to processing provided by third parties or through ownership interests in processing facilities.
Upstream
334
382
332
270
923
781
Upstream Transportation and Processing
440
399
1,257
1,163
3.74
4.02
3.89
4.04
11.35
12.00
11.37
11.77
7.59
7.31
7.53
7.24
Transportation and processing expense increased $44 million compared to the third quarter of 2024 primarily due to:
Transportation and processing expense increased $45 million compared to the first nine months of 2024 primarily due to:
Operating expense includes costs paid by the Company, net of amounts capitalized, on oil and natural gas properties in which Ovintiv has a working interest. These costs primarily include labor, service contract fees, chemicals, fuel, water hauling, electricity and workovers.
173
193
515
609
Upstream Operating Expense
635
696
6.07
6.02
6.45
1.55
1.47
1.31
3.71
4.17
3.81
4.33
Operating expense decreased $15 million compared to the third quarter of 2024 primarily due to:
Operating expense decreased $71 million compared to the first nine months of 2024 primarily due to:
Purchased Product
Purchased product expense includes purchases of oil, NGLs and natural gas from third parties that are used to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification within the USA and Canadian Operations segments.
Purchased product expense decreased $114 million compared to the third quarter of 2024 primarily due to:
Purchased product expense decreased $45 million compared to the first nine months of 2024 primarily due to:
Depreciation, Depletion & Amortization
Proved properties within each country cost center are depleted using the unit-of-production method based on proved reserves as discussed in Note 1 to the Consolidated Financial Statements included in Item 8 of the 2024 Annual Report on Form 10-K. Depletion rates are impacted by impairments, acquisitions, divestitures and foreign exchange rates, as well as fluctuations in 12-month average trailing prices which affect proved reserves volumes. Corporate assets are carried at cost and depreciated on a straight-line basis over the estimated service lives of the assets.
Additional information can be found under Upstream Assets and Reserve Estimates in the Critical Accounting Estimates section of the MD&A included in Item 7 of the 2024 Annual Report on Form 10-K.
Upstream DD&A
540
593
1,630
1,728
12.57
16.12
12.88
15.93
6.13
3.40
9.31
10.87
9.76
10.75
DD&A decreased $54 million compared to the third quarter of 2024 primarily due to:
The upstream depletion rate in the USA Operations decreased $3.55 per BOE primarily due to a lower depletable base resulting from the sale of the Uinta assets in the first quarter of 2025. The upstream depletion rate in the Canadian Operations increased $2.73 per BOE primarily due to a higher depletable base resulting from the Montney Acquisition in the first quarter of 2025, partially offset by the ceiling test impairments recognized in the fourth quarter of 2024 and first quarter of 2025.
DD&A decreased $99 million compared to the first nine months of 2024 primarily due to:
The upstream depletion rate in the USA Operations decreased $3.05 per BOE primarily due to a lower depletable base resulting from the sale of the Uinta assets in the first quarter of 2025. The upstream depletion rate in the Canadian Operations increased $3.06 per BOE primarily due to a higher depletable base resulting from the Montney Acquisition in the first quarter of 2025, partially offset by the ceiling test impairments recognized in the fourth quarter of 2024 and first quarter of 2025.
Ceiling Test Impairment
Under full cost accounting, the carrying amount of Ovintiv’s oil and natural gas properties within each country cost center is subject to a ceiling test performed quarterly. Ceiling test impairments are recognized when the capitalized costs, net of accumulated depletion and the related deferred income taxes, exceed the sum of the estimated after-tax future net cash flows from proved reserves as calculated under SEC requirements using the 12-month average trailing prices and discounted at 10 percent. The 12‑month average trailing price is calculated as the average of the price on the first day of each month within the trailing 12‑month period.
In the third quarter of 2025, the Company recognized a before-tax non-cash ceiling test impairment of $141 million in the Canadian Operations primarily resulting from the decline in the 12-month average trailing prices, which reduced proved reserves. In the first nine months of 2025, the Company recognized ceiling test impairments of $871 million in the Canadian Operations primarily due to the 12-month average trailing prices used in the ceiling test at March 31, 2025, which were lower than the market prices used for the Montney Acquisition on January 31, 2025.
The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.
WTI($/bbl)
EdmontonCondensate(C$/bbl)
Henry Hub($/MMBtu)
AECO(C$/MMBtu)
Further declines in the 12‑month average trailing commodity prices could reduce proved reserves values and result in the recognition of future ceiling test impairments. Future ceiling test impairments can also result from changes to reserves estimates, future development costs, capitalized costs and unproved property costs. Proceeds received from oil and natural gas divestitures are typically deducted from the Company’s capitalized costs and can reduce the risk of ceiling test impairments.
The Company believes that the discounted after-tax future net cash flows from proved reserves required to be used in the ceiling test calculation are not indicative of the fair market value of Ovintiv’s oil and natural gas properties or the future net cash flows expected to be generated from such properties. The discounted after-tax future net cash flows do not consider the fair market value of unamortized unproved properties, or probable or possible liquids and natural gas reserves. In addition, there is no consideration given to the effect of future changes in commodity prices. Ovintiv manages its business using estimates of reserves and resources based on forecast prices and costs. Additional information on the ceiling test calculation can be found in Note 9 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q.
Administrative expense represents costs associated with corporate functions provided by Ovintiv staff. These expenses primarily include salaries and benefits, operating leases, office, information technology, restructuring and long-term incentive costs.
Administrative, excluding Long-Term Incentive Costs,
Restructuring Costs, and Legal Costs (1)
206
Long-term incentive costs
Restructuring costs
Legal costs
Total Administrative
1.17
1.23
0.16
0.09
0.07
0.01
1.34
1.33
1.48
Administrative expense increased $6 million compared to the third quarter of 2024 primarily due to:
Administrative expense decreased $3 million compared to the first nine months of 2024 primarily due to:
In 2024, Ovintiv undertook a plan to reduce its workforce by approximately 10 percent as part of a corporate reorganization. Additional information on restructuring charges and long-term incentive costs can be found in Notes 16 and 17 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Other (Gains) Losses, Net
Interest expense primarily includes interest on Ovintiv’s short-term and long-term debt. Additional information on changes in interest and long-term debt can be found in Notes 5 and 11, respectively, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Interest expense decreased $12 million compared to the third quarter of 2024 primarily due to:
Interest expense decreased $23 million compared to the first nine months of 2024 primarily due to:
Foreign exchange gains and losses primarily result from the impact of fluctuations in the Canadian to U.S. dollar exchange rate. Additional information on changes in foreign exchange gains or losses can be found in Note 6 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Additional information on foreign exchange rates and the effects of foreign exchange rate changes can be found in Part I, Item 3 of this Quarterly Report on Form 10-Q.
Net foreign exchange gain of $7 million compared to a loss of $17 million during the third quarter of 2024 primarily due to:
Net foreign exchange loss of $25 million compared to a gain of $21 million during the first nine months of 2024 primarily due to:
Other (gains) losses, net, primarily includes other non-recurring revenues or expenses and may also include items such as interest income, reclamation charges related to decommissioned assets, and adjustments related to other assets.
Other gains in the third quarter and first nine months of 2025 includes interest income of $2 million and $10 million, respectively, primarily generated from short-term investments (2024 - $1 million and $4 million, respectively).
During the first nine months of 2024, the Company resolved a dispute related to the previous disposition of certain legacy assets for approximately $150 million.
Income Tax
For the three and nine months ended September 30, 2025, current income tax expense of $14 million and $83 million, respectively, were lower than the comparative periods in 2024 primarily due to lower expected full year taxable earnings and the anticipated impact of the One Big Beautiful Bill Act (H.R.1).
For the three months ended September 30, 2025, the deferred income tax expense of $30 million was higher than the comparative period in 2024 primarily due to research and development credits recognized in the United States in 2024, partially offset by the impact of a non-cash ceiling test impairment recognized in Canada. For the nine months ended September 30, 2025, the deferred income tax expense of $19 million was lower than the comparative period in 2024 primarily due to the impact of non-cash ceiling test impairments recognized in Canada in 2025, partially offset by research and development credits recognized in the United States in 2024.
The determination of income and other tax liabilities of the Company and its subsidiaries requires interpretation of complex domestic and foreign tax laws and regulations, that are subject to change. The Company’s interpretation of tax laws may differ from the interpretation of the tax authorities. As a result, there are tax matters under review for which the timing of resolution is uncertain. The Company believes that the provision for income taxes is adequate.
Additional information on income taxes can be found in Note 7 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Liquidity and Capital Resources
Sources of Liquidity
The Company has the flexibility to access cash equivalents and a range of funding alternatives at competitive rates through committed revolving credit facilities as well as debt and equity capital markets. Ovintiv closely monitors the accessibility of cost-effective credit and ensures that sufficient liquidity is in place to fund capital expenditures and dividend payments. In addition, the Company may use cash and cash equivalents, cash from operating activities, or proceeds from asset divestitures to fund its operations and capital allocation framework or to manage its capital structure as discussed below. As at September 30, 2025, $16 million in cash and cash equivalents was held by Canadian subsidiaries. The cash held by Canadian subsidiaries is accessible and may be subject to additional U.S. income taxes and Canadian withholding taxes if repatriated.
The Company’s capital structure consists of total shareholders’ equity plus long-term debt, including any current portion. The Company’s objectives when managing its capital structure are to maintain financial flexibility to preserve Ovintiv’s access to capital markets and its ability to meet financial obligations and finance internally generated growth, as well as potential acquisitions. Ovintiv has a practice of maintaining capital discipline and strategically managing its capital structure by adjusting capital spending, adjusting dividends paid to shareholders, issuing new shares of common stock, purchasing shares of common stock for cancellation or return to treasury, issuing new debt and repaying or repurchasing existing debt.
As at September 30,
($ millions, except as indicated)
Cash and Cash Equivalents
Available Credit Facilities
3,500
3,400
Available Uncommitted Demand Lines (1)
122
Issuance of U.S. Commercial Paper
(360
(324
Total Liquidity
3,287
3,317
Long-Term Debt, including current portion
5,877
Debt to Capitalization (%) (2)
Debt to Adjusted Capitalization (%) (2)
The Company has full access to two committed revolving U.S. dollar denominated credit facilities totaling $3.5 billion, which include a $2.2 billion revolving credit facility for Ovintiv Inc. and a $1.3 billion revolving credit facility for a Canadian subsidiary (collectively, the “Credit Facilities”). The Credit Facilities, which mature in December 2029, provide financial flexibility and allow the Company to fund its operations or capital investment program. As at September 30, 2025, there were no outstanding amounts under the revolving Credit Facilities.
Depending on the Company’s credit rating and market demand, the Company may issue from its two U.S. Commercial Paper (“CP”) programs, which include a $1.5 billion program for Ovintiv Inc. and a $1.0 billion program for a Canadian subsidiary. As at September 30, 2025, the Company had $360 million of commercial paper outstanding under its U.S. CP program maturing at various dates with a weighted average interest rate of approximately 4.84 percent, which is supported by the Company’s Credit Facilities. All of Ovintiv’s credit ratings are investment grade as at September 30, 2025.
The available Credit Facilities, uncommitted demand lines, and cash and cash equivalents, net of outstanding commercial paper, provide Ovintiv with total liquidity of approximately $3.3 billion as at September 30, 2025. As at September 30, 2025, Ovintiv also had approximately $183 million in undrawn letters of credit issued in the normal course of business as collateral security.
On November 4, 2025, the Company announced the NuVista Acquisition, as discussed in the Significant Developments and Subsequent Events section of this MD&A. Ovintiv expects to fund the cash portion of the transaction through a combination of cash on hand, short-term borrowings, and proceeds from term loan financing.
Ovintiv has a U.S. shelf registration statement under which the Company may issue from time to time, debt securities, common stock, preferred stock, warrants, units, share purchase contracts and share purchase units in the U.S. The U.S. shelf registration statement expires in March 2026.
54
The obligations under the Company’s existing debt securities are fully and unconditionally guaranteed on a senior unsecured basis by Ovintiv Canada ULC, an indirect wholly-owned subsidiary of the Company. Additional information on the Company’s Canadian Operations segment and the Bow office lease can be found in the Results of Operations section in this MD&A and in the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, and the MD&A and audited Consolidated Financial Statements and accompanying notes for the year ended December 31, 2024, which are included in Items 7 and 8, respectively, of the 2024 Annual Report on Form 10-K.
Ovintiv is currently in compliance with all financial covenants under the Credit Facilities. Management monitors Debt to Adjusted Capitalization, which is a non-GAAP measure defined in the Non-GAAP Measures section of this MD&A, as a proxy for Ovintiv’s financial covenant under the Credit Facilities, which requires Debt to Adjusted Capitalization to be less than 60 percent. As at September 30, 2025, the Company’s Debt to Adjusted Capitalization was 22 percent. The definitions used in the covenant under the Credit Facilities adjust capitalization for cumulative historical ceiling test impairments recorded in conjunction with the Company’s January 1, 2012 adoption of U.S. GAAP. Additional information on financial covenants can be found in Note 15 to the Consolidated Financial Statements included in Item 8 of the 2024 Annual Report on Form 10‑K.
Sources and Uses of Cash
The following table summarizes the sources and uses of the Company’s cash and cash equivalents.
Activity Type
Sources of Cash, Cash Equivalents and Restricted Cash
Cash from operating activities
Investing
Net issuance of revolving debt
Financing
872
1,051
5,116
2,876
Uses of Cash and Cash Equivalents
Net repayment of revolving debt
121
210
160
163
307
597
238
998
5,124
2,820
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents and Restricted Cash Held in Foreign Currency
Net cash from operating activities in the third quarter and first nine months of 2025 was $812 million and $2,698 million, respectively, and was primarily a reflection of the impacts from production volumes, average realized commodity prices, realized gains/losses on risk management and changes in non‑cash working capital.
Additional detail on changes in non-cash working capital can be found in Note 20 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Ovintiv expects it will continue to meet the payment terms of its suppliers.
Non-GAAP Cash Flow in the third quarter and first nine months of 2025 was $895 million and $2,812 million, respectively, and was primarily impacted by the items affecting cash from operating activities which are discussed below and in the Results of Operations section of this MD&A.
Net cash from operating activities decreased $210 million compared to the third quarter of 2024 primarily due to:
Net cash from operating activities decreased $3 million compared to the first nine months of 2024 primarily due to:
Cash used in investing activities in the first nine months of 2025 was $1,906 million primarily due to the Montney Acquisition and capital expenditures, partially offset by the sale of the Company’s Uinta assets. Capital expenditures, and acquisition and divestiture activities are summarized in Notes 3 and 8, respectively, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q.
Capital expenditures decreased $69 million compared to the first nine months of 2024, primarily due to decreased capital activity resulting from the sale of the Uinta assets in the first quarter of 2025, and decreased capital activity and increased efficiencies in Permian, partially offset by increased capital activity in Anadarko and increased capital activity in Montney primarily due to the Montney Acquisition in the first quarter of 2025.
Acquisitions in the first nine months of 2025 were $2,282 million, which primarily included the Montney Acquisition. Acquisitions in the first nine months of 2024 were $202 million, which primarily included property purchases with oil and liquids-rich potential in the USA Operations.
Divestitures in the first nine months of 2025 were $1,922 million, which primarily included the sale of the Uinta assets in Utah.
Additional information regarding the Montney Acquisition and the sale of the Uinta assets can be found in Note 8 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Net cash used in financing activities has been impacted by Ovintiv’s strategic objective to return value to shareholders by repaying existing debt, purchasing shares of common stock and paying dividends.
Net cash used in financing activities in the first nine months of 2025 increased $73 million compared to 2024. The increase was primarily due to the repayment of the Company’s May 2025 senior notes during the second quarter of 2025 ($600 million), partially offset by decreased purchases of shares of common stock ($290 million) and an increase in the net issuance of revolving debt in 2025 compared to 2024 ($220 million).
In May 2025, Ovintiv redeemed its $600 million, 5.65 percent senior notes due May 15, 2025, with cash on hand and proceeds from short-term borrowings. The Company’s long-term debt, including the current portion of $819 million, totaled $5,212 million at September 30, 2025. The Company’s long-term debt at December 31, 2024, including the current portion of $600 million, totaled $5,453 million. As at September 30, 2025, the Company has $459 million of fixed rate long-term debt due within the next year.
From time to time, Ovintiv may seek to retire or purchase the Company’s outstanding debt through cash purchases and/or exchanges for other debt or equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, the Company’s liquidity requirements, contractual restrictions and other factors.
In support of the Company’s commitment to enhancing shareholder value, Ovintiv utilizes its capital allocation framework to provide competitive returns to shareholders while strengthening its balance sheet. In conjunction with the NuVista Acquisition as discussed in the Significant Developments and Subsequent Events section of this MD&A, the Company has temporarily paused its share buyback program for two quarters, starting in October 2025, and expects to resume the buybacks in the second quarter of 2026. Dividends declared and paid by the Company are expected to remain unchanged.
For additional information on long-term debt, refer to Note 11 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Further details on the Company’s debt-based metrics can be found in the Non-GAAP measures section of this MD&A.
The Company pays quarterly dividends to common shareholders at the discretion of the Board of Directors.
Dividend Payments
Dividend Payments ($/share)
0.30
0.90
On November 4, 2025, the Board of Directors declared a dividend of $0.30 per share of common stock payable on December 31, 2025, to common shareholders of record as of December 15, 2025.
On September 29, 2025, the Company announced it had received regulatory approval for the renewal of its NCIB program, which enables the Company to purchase, for cancellation or return to treasury, up to approximately 22.3 million shares of common stock over a 12-month period from October 3, 2025, to October 2, 2026. The Company expects to continue to execute the NCIB program in conjunction with its capital allocation framework.
In the third quarter and first nine months of 2025, under the previous NCIB program, which extended from October 3, 2024, to October 2, 2025, the Company purchased, for cancellation, approximately 3.7 million and 7.8 million shares of common stock, respectively, for total consideration of approximately $160 million and $307 million, respectively. For additional information on the NCIB, refer to Note 13 to the Consolidated Financial Statements included in Part I, Item 1 and Part II, Item 2, “Unregistered Sales of Equity Securities and Use of Proceeds” of this Quarterly Report on Form 10‑Q.
Material Cash Requirements
For information on material cash requirements, refer to the Material Cash Requirements section of the MD&A included in Item 7 of the 2024 Annual Report on Form 10-K.
For information on commitments and contingencies, refer to Note 21 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Critical Accounting Estimates
There have been no significant changes to the Company’s critical accounting policies and use of estimates from the disclosures reported in the Critical Accounting Estimates section of the MD&A included in Item 7 of the 2024 Annual Report on Form 10‑K.
Non-GAAP Measures
Certain measures in this document do not have any standardized meaning as prescribed by U.S. GAAP and, therefore, are considered non-GAAP measures. These measures may not be comparable to similar measures presented by other issuers and should not be viewed as a substitute for measures reported under U.S. GAAP. These measures are commonly used in the oil and gas industry and by Ovintiv to provide shareholders and potential investors with additional information regarding the Company’s liquidity and its ability to generate funds to finance its operations. Non-GAAP measures include: Non-GAAP Cash Flow, Debt to Adjusted Capitalization, Debt to EBITDA and Debt to Adjusted EBITDA. Management’s use of these measures is discussed further below.
Cash from Operating Activities and Non-GAAP Cash Flow
Non-GAAP Cash Flow is a non-GAAP measure defined as cash from (used in) operating activities excluding net change in other assets and liabilities, and net change in non-cash working capital.
Management believes this measure is useful to the Company and its investors as a measure of operating and financial performance across periods and against other companies in the industry, and is an indication of the Company’s ability to generate cash to finance capital investment programs, to service debt and to meet other financial obligations. This measure is used, along with other measures, in the calculation of certain performance targets for the Company’s management and employees.
(Add back) deduct:
Non-GAAP Cash Flow
895
978
2,812
3,038
Debt to Capitalization and Debt to Adjusted Capitalization
Debt to Adjusted Capitalization is a non-GAAP measure which adjusts capitalization for historical ceiling test impairments that were recorded as at December 31, 2011. Management monitors Debt to Adjusted Capitalization as a proxy for the Company’s financial covenant under the Credit Facilities which require Debt to Adjusted Capitalization to be less than 60 percent. Adjusted Capitalization includes debt, total shareholders’ equity and an equity adjustment for cumulative historical ceiling test impairments recorded as at December 31, 2011, in conjunction with the Company’s January 1, 2012, adoption of U.S. GAAP.
Debt (Long-Term Debt, including Current Portion)
Capitalization
15,446
15,784
Debt to Capitalization
34%
35%
Equity Adjustment for Impairments at December 31, 2011
7,746
Adjusted Capitalization
23,192
23,530
Debt to Adjusted Capitalization
22%
23%
Debt to EBITDA and Debt to Adjusted EBITDA
Debt to EBITDA and Debt to Adjusted EBITDA are non-GAAP measures. EBITDA is defined as trailing 12-month net earnings (loss) before income taxes, depreciation, depletion and amortization, and interest. Adjusted EBITDA is EBITDA adjusted for impairments, accretion of asset retirement obligation, unrealized gains/losses on risk management, foreign exchange gains/losses, gains/losses on divestitures and other gains/losses.
Management believes these measures are useful to the Company and its investors as a measure of financial leverage and the Company’s ability to service its debt and other financial obligations. These measures are used, along with other measures, in the calculation of certain financial performance targets for the Company’s management and employees.
236
1,125
Add back (deduct):
2,191
2,290
389
226
EBITDA
2,877
4,053
Debt to EBITDA (times)
1.8
1.3
1,321
450
Unrealized (gains) losses on risk management
(16
(165
Adjusted EBITDA
4,322
4,474
Debt to Adjusted EBITDA (times)
1.2
Item 3: Quantitative and Qualitative Disclosures About Market Risk
The primary objective of the following information is to provide forward-looking quantitative and qualitative information about Ovintiv’s potential exposure to market risks. The term “market risk” refers to the Company’s risk of loss arising from adverse changes in oil, NGL and natural gas prices, foreign currency exchange rates and interest rates. The following disclosures are not meant to be precise indicators of expected future losses but rather indicators of reasonably possible losses. The forward-looking information provides indicators of how the Company views and manages ongoing market risk exposures.
COMMODITY PRICE RISK
Commodity price risk arises from the effect fluctuations in future commodity prices, including oil, NGLs and natural gas, may have on future revenues, expenses and cash flows. Realized pricing is primarily driven by the prevailing worldwide price for oil and spot market prices applicable to the Company’s natural gas production. Pricing for oil, NGLs and natural gas production is volatile and unpredictable as discussed in Part 1, Item 2 of this Quarterly Report on Form 10‑Q in the Executive Overview section in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Item 1A. “Risk Factors” of the 2024 Annual Report on Form 10‑K. To partially mitigate exposure to commodity price risk, the Company may enter into various derivative financial instruments including futures, forwards, swaps, options and costless collars. The use of these derivative instruments is governed under formal policies and is subject to limits established by the Board of Directors and may vary from time to time. Both exchange traded and over-the-counter traded derivative instruments may be subject to margin-deposit requirements, and the Company may be required from time to time to deposit cash or provide letters of credit with exchange brokers or counterparties to satisfy these margin requirements. For additional information relating to the Company’s derivative and financial instruments, see Notes 18 and 19 to the Condensed Consolidated Financial Statements under Part I, Item 1 of this Quarterly Report on Form 10‑Q.
The table below summarizes the sensitivity of the fair value of the Company’s risk management positions to fluctuations in commodity prices, with all other variables held constant. The Company has used a 10 percent variability to assess the potential impact of commodity price changes. Fluctuations in commodity prices could have resulted in unrealized gains (losses) impacting pre-tax net earnings as follows:
10% PriceIncrease
10% PriceDecrease
Oil price
(51
NGL price
Natural gas price
FOREIGN EXCHANGE RISK
Foreign exchange risk arises from changes in foreign exchange rates that may affect the fair value or future cash flows from the Company’s financial assets or liabilities. As Ovintiv operates primarily in the United States and Canada, fluctuations in the exchange rate between the U.S. and Canadian dollars can have a significant effect on the Company’s reported results.
The table below summarizes selected foreign exchange impacts on Ovintiv’s financial results when compared to the same periods in 2024.
Three Months EndedSeptember 30,
Nine Months EndedSeptember 30,
$ millions
$/BOE
Increase (Decrease) in:
Capital Investment (1)
Transportation and Processing Expense (1)
(0.05
(0.12
Operating Expense (1)
(0.01
Administrative Expense
(0.02
Depreciation, Depletion and Amortization (1)
(0.04
Foreign exchange gains and losses also arise when monetary assets and monetary liabilities denominated in foreign currencies are translated and settled, and primarily include:
To partially mitigate the effect of foreign exchange fluctuations on future commodity revenues and expenses, the Company may enter into foreign currency derivative contracts from time to time. As at September 30, 2025, the Company does not have any notional U.S. dollar denominated currency swaps.
As at September 30, 2025, Ovintiv did not have any U.S. dollar denominated financing debt issued from Canada that was subject to foreign exchange exposure.
The table below summarizes the sensitivity to foreign exchange rate fluctuations, with all other variables held constant. The Company has used a 10 percent variability to assess the potential impact from Canadian to U.S. foreign currency exchange rate changes. Fluctuations in foreign currency exchange rates could have resulted in unrealized gains (losses) impacting pre-tax net earnings as follows:
10% RateIncrease
10% RateDecrease
Foreign currency exchange
(42
INTEREST RATE RISK
Interest rate risk arises from changes in market interest rates that may affect the fair value or future cash flows from the Company’s financial assets or liabilities. The Company may partially mitigate its exposure to interest rate changes by holding a mix of both fixed and floating rate debt and may also enter into interest rate derivatives to partially mitigate effects of fluctuations in market interest rates.
As at September 30, 2025, Ovintiv had floating rate revolving credit and term loan borrowings of $360 million. Accordingly, on a before-tax basis, the sensitivity for each one percent change in interest rates on floating rate revolving credit and term loan borrowings was $4 million.
Item 4: Controls and Procedures
DISCLOSURE CONTROLS AND PROCEDURES
Ovintiv’s Chief Executive Officer and Chief Financial Officer performed an evaluation of the effectiveness of the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. The Company’s disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in reports it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and to ensure that the information required to be disclosed by the Company in reports that it files or submits under the Exchange Act, is accumulated and communicated to the Company’s management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2025.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no changes in the Company’s internal controls over financial reporting during the third quarter of 2025 that have materially affected, or are reasonably likely to affect, the Company’s internal controls over financial reporting.
Item 1. Legal Proceedings
Please refer to Item 3 of the 2024 Annual Report on Form 10‑K and Note 21 to the Condensed Consolidated Financial Statements under Part I, Item 1 of this Quarterly Report on Form 10‑Q.
Item 1A. Risk Factors
In addition to the other information set forth in this Quarterly Report on Form 10-Q, the reader should carefully consider the factors discussed in Item 1A. Risk Factors of the 2024 Annual Report on Form 10-K. These risks, which could materially affect our business, financial condition or future results, are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also adversely affect our business, financial condition and/or operating results.
In addition to the risk factors previously disclosed in the 2024 Annual Report on Form 10-K, the following are risks related to our pending acquisition of NuVista:
Completion of the NuVista Acquisition is subject to conditions, including certain conditions that may not be satisfied or completed on a timely basis or at all. Failure to complete the NuVista Acquisition could have material and adverse effects on us.
Our obligations and the obligations of NuVista to consummate the NuVista Acquisition are subject to the satisfaction (or waiver by all parties, to the extent permissible under applicable laws) of a number of conditions described in the arrangement agreement (the “Arrangement Agreement”), including, among other things, the approval and adoption of the Arrangement Agreement and the transactions contemplated therein, including the arrangement (the “Arrangement”), by the NuVista shareholders and the approval of the Arrangement by the Court of King’s Bench of Alberta on terms consistent with the Arrangement Agreement and otherwise reasonably satisfactory to the parties. Such conditions, some of which are beyond our control, may not be satisfied or waived in a timely manner or at all and therefore make the completion and timing of the completion of the NuVista Acquisition uncertain. If any of these conditions are not satisfied or waived prior to the Termination Date (as such term is defined in the Arrangement Agreement), it is possible that the Arrangement Agreement may be terminated. The Arrangement Agreement provides that, upon termination of the Arrangement Agreement under certain circumstances, we or NuVista would be required to pay the other party a termination fee of C$130 million. Furthermore, the governmental authorities from which regulatory approvals are required may impose conditions on the completion of the NuVista Acquisition or require changes to the terms thereof. Such conditions or changes and the process of obtaining regulatory approvals could have the effect of delaying or impeding consummation of the transactions or of imposing additional costs or limitations on us following completion of the NuVista Acquisition, any of which might have an adverse effect on us.
If the NuVista Acquisition is not completed, our ongoing business may be adversely affected and, without realizing any of the benefits of having completed the NuVista Acquisition, we will be subject to a number of risks, including the following:
If the NuVista Acquisition is consummated, we may be unable to successfully integrate the assets into our business or achieve the anticipated benefits of the NuVista Acquisition.
Our ability to achieve the anticipated benefits of the NuVista Acquisition will depend in part upon whether we can integrate the assets and their operations into our existing business in an efficient and effective manner. We may not be able to accomplish this integration process successfully. The successful acquisition of producing properties, including the assets, requires an assessment of several factors, including:
The accuracy of these assessments is inherently uncertain. In connection with our assessment of the assets, we have performed a review of the subject properties that we believe to be generally consistent with industry practices. The review was based on our analysis of historical production data, assumptions regarding capital expenditures and anticipated production declines without review by an independent petroleum engineering firm. Data used in such review was furnished by NuVista or obtained from publicly available sources. Our review may not reveal all existing or potential problems or permit us to fully assess the deficiencies and potential recoverable reserves for all of the assets, and the reserves and production related to the assets may differ materially after such data is reviewed by an independent petroleum engineering firm or further by us. Inspections were not performed on every well, and environmental problems are not necessarily observable even when an inspection is undertaken.
The integration process may be subject to delays or changed circumstances, and we can give no assurance that the assets will perform in accordance with our expectations or that our expectations with respect to integration or cost savings as a result of the NuVista Acquisition will materialize.
We and NuVista will be subject to business uncertainties while the NuVista Acquisition is pending, which could adversely affect our business.
In connection with the pendency of the NuVista Acquisition, it is possible that certain persons with whom we or NuVista have a business relationship may delay or defer certain business decisions or might decide to seek to terminate, change or renegotiate their relationships with us or NuVista, as the case may be, as a result of the NuVista Acquisition and related transactions, which could negatively affect our or NuVista’s revenues, earnings and cash flows as well as the market price of Ovintiv’s common stock, regardless of whether the NuVista Acquisition is completed. Also, our and NuVista’s ability to attract, retain and motivate employees may be impaired until the NuVista Acquisition is completed, and our ability to do so may be impaired for a period of time thereafter, as current and prospective employees may experience uncertainty about their roles within the company following the NuVista Acquisition.
Under the terms of the Arrangement Agreement, we and NuVista are subject to certain restrictions on the conduct of business prior to the closing of the NuVista Acquisition, which may adversely affect our and NuVista’s ability to execute certain of our and their business strategies, including the ability in certain cases to modify or enter into certain contracts, acquire or dispose of certain assets, incur or prepay certain indebtedness, incur encumbrances, make capital expenditures or settle claims. Such limitations could negatively affect our and NuVista’s businesses and operations prior to the completion of the NuVista Acquisition.
The NuVista Acquisition may not be accretive, and may be dilutive, to our earnings per share, which may negatively affect the market price of our common stock.
Because shares of our common stock will be issued upon the consummation of the Arrangement, it is possible that, although we currently expect the NuVista Acquisition to be accretive to earnings per share, the NuVista Acquisition may be dilutive to our earnings per share, which could negatively affect the market price of Ovintiv’s common stock. In connection with the completion of the NuVista Acquisition, based on the number of issued and outstanding shares of our common stock as of November 3, 2025, we will issue approximately 30 million shares of our common stock to former NuVista shareholders. The issuance of these new shares of our common stock could have the effect of depressing the market price of our common stock,
64
through dilution of earnings per share or otherwise. Any dilution of, or delay of any accretion to, our earnings per share could cause the price of shares of our common stock to decline or increase at a reduced rate. Furthermore, former NuVista shareholders or our current stockholders may not wish to continue to invest in our expanded operations of the combined company, or for other reasons may wish to dispose of some or all of their interests in Ovintiv, and as a result may seek to sell their shares of our common stock following, or in anticipation of, completion of the NuVista Acquisition. The Arrangement Agreement contains no restrictions on the ability of former NuVista shareholders to sell or otherwise dispose of such shares following completion of the Arrangement. Therefore, these sales (or the perception that these sales may occur), coupled with the increase in the outstanding number of shares of our common stock, may affect the market for, and the market price of, our common stock in an adverse manner. If the NuVista Acquisition is completed and our stockholders, including the former NuVista shareholders, sell substantial amounts of our common stock in the public market following the consummation of the Arrangement, the market price of our common stock may decrease. These sales might also make it more difficult for us to raise capital by selling equity or equity-related securities at a time and price that we otherwise would deem appropriate.
Our results may suffer if we do not effectively manage our expanded operations following the NuVista Acquisition.
The success of the NuVista Acquisition will depend, in part, on our ability to realize the anticipated benefits and cost savings from combining our and NuVista’s businesses, including the need to integrate the operations and businesses of NuVista into our existing business in an efficient and timely manner, to combine systems and management controls and to integrate relationships with customers, vendors, industry contacts and business partners.
The anticipated benefits and cost savings of the NuVista Acquisition may not be realized fully or at all, may take longer to realize than expected or could have other adverse effects that we do not currently foresee. Some of the assumptions that we have made, such as the achievement of operating synergies, may not be realized. There could also be unknown liabilities and unforeseen expenses associated with the NuVista Acquisition, which were not discovered in the due diligence review conducted by each company prior to entering into the Arrangement Agreement.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchase of Equity Securities
On September 26, 2024, Ovintiv announced it had received regulatory approval to purchase, for cancellation or return to treasury, up to approximately 25.9 million shares of common stock pursuant to a NCIB over a 12-month period from October 3, 2024, and ending October 2, 2025. The number of shares of common stock authorized for purchase represents 10 percent of Ovintiv’s public float as at such time.
On September 29, 2025, Ovintiv announced it had received regulatory approval to purchase, for cancellation or return to treasury, up to approximately 22.3 million shares of common stock pursuant to a NCIB over a 12-month period from October 3, 2025, and ending October 2, 2026. The number of shares of common stock authorized for purchase represents 10 percent of Ovintiv’s public float as at September 26, 2025.
During the three months ended September 30, 2025, the Company purchased 3,770,911 shares of common stock for approximately $158 million, excluding excise tax, at a weighted average price of $41.90. The following table presents the common shares purchased during the three months ended September 30, 2025.
Period
Total Number ofShares Purchased (1)
AveragePrice Paidper Share (2)
Total Number of SharesPurchased as Part of PubliclyAnnounced Plans or Programs
Maximum Number of SharesThat May Yet be PurchasedUnder the Plans or Programs
July 1 to July 31, 2025
21,855,445
August 1 to August 31, 2025
668,925
41.56
21,186,520
September 1 to September 30, 2025
3,101,986
41.97
18,084,534
3,770,911
41.90
In the second quarter of 2025, Ovintiv renewed its exemption order (the “NCIB Exemption”) from the Alberta Securities Commission and the Ontario Securities Commission, which permits Ovintiv to make repurchases (the “Proposed Bids”), under its current and any future normal course issuer bids, through the facilities of the NYSE and other U.S.-based trading systems
(collectively, “U.S. Markets”), in excess of the maximum allowable purchases under applicable Canadian securities laws. The Company’s initial NCIB Exemption was granted in the first quarter of 2022. The NCIB Exemption applies to any Proposed Bid commenced within 36 months of the date of the exemption order and is subject to several other conditions, including that Ovintiv remain a U.S. and SEC foreign issuer under applicable Canadian securities laws. The purchases of common stock under a Proposed Bid must also be made in compliance with other applicable Canadian securities laws and applicable U.S. rules. Additionally, the NCIB Exemption imposes restrictions on the number of shares of common stock that may be acquired under the exemption, including that: (a) Ovintiv may not acquire common stock in reliance upon the exemption under subsection 4.8(3) of Canadian National Instrument 62-104 – Take-Over Bids and Issuer Bids (“NI 62-104”) from the requirements applicable to issuer bids (the “Other Published Markets Exemption”) if the aggregate number of shares of common stock purchased by Ovintiv, and any person or company acting jointly or in concert with Ovintiv, in reliance on the NCIB Exemption and the Other Published Markets Exemption within any period of 12 months exceeds 5 percent of the outstanding common stock on the first day of such 12-month period; and (b) the aggregate number of shares of common stock purchased pursuant to (i) a Proposed Bid in reliance on the NCIB Exemption; (ii) exempt issuer bid purchases made in the normal course through the facilities of the TSX; and (iii) the Other Published Markets Exemption does not exceed, over the 12-month period of its current NCIB, 10 percent of Ovintiv’s public float. As a result, the NCIB Exemption effectively allows Ovintiv to purchase up to 10 percent of its public float on U.S. Markets under its NCIB. Without the NCIB Exemption this amount would be limited to 5 percent of Ovintiv’s outstanding common stock within a 12-month period under applicable Canadian securities law.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Item 6. Exhibits
Exhibit No
Description
31.1
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.
31.2
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.
32.1*
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
32.2*
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
101.INS
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH
Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document.
The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, has been formatted in Inline XBRL.
* The certifications on Exhibits 32.1 and 32.2 hereto are deemed not “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. Such certifications will not be deemed incorporated by reference to any filings under the Securities Act or the Exchange Act.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
By:
/s/ Corey D. Code
Name:
Corey D. Code
Title:
Executive Vice-President &
Chief Financial Officer
Dated: November 4, 2025