CRC Posts $514M Q2 Profit, Launches Carbon Injection, and Acquires Crimson Midstream

summarizeSummary

CRC reported Q2 net income of $514 million, achieved first CO2 injection at its carbon capture project, and announced a $63 million midstream acquisition. The six-month net loss of $197 million reflects non-cash derivative mark-to-market swings, not operational weakness.

check_boxKey Events · Earnings and Guidance · CRC

• Q2 Net Income of $514M

  Net income reached $514 million ($5.76 diluted EPS) on revenues of $1.3 billion, supported by Brent oil prices averaging $96.87/bbl and a $370 million non-cash derivative gain. Adjusted EBITDAX came in at $338 million, and free cash flow hit $114 million.

• Six-Month Loss from Non-Cash Hedging

  For the first half of 2026, a net loss of $197 million was entirely driven by a $643 million non-cash loss on commodity derivatives. This mark-to-market charge reflects the accounting impact of hedging positions, not cash outflows or dilution.

• First CO2 Injection at Carbon TerraVault I

  CO2 injection began at the 26R reservoir in May 2026, marking the operational launch of the carbon management segment. The Carbon TerraVault JV recorded approximately $1 million in revenue during Q2.

• Crimson Midstream Acquisition for $63M

  An agreement was reached to acquire Crimson Midstream Holdings, gaining roughly 2,000 miles of California pipelines. The deal is expected to close later this year, subject to regulatory approvals.

auto_awesomeAnalysis · CRC · Energy & Transportation

A strong second quarter delivered $514 million in net income, fueled by elevated oil prices and a $370 million non-cash derivative gain. Over the first six months, however, the company recorded a $197 million net loss—entirely attributable to a $643 million non-cash mark-to-market loss on hedges, with no cash outflow or dilution. A key milestone was reached with the first CO2 injection at the Carbon TerraVault I project, advancing the carbon management business. In a move to strengthen market access, the company agreed to acquire Crimson Midstream for $63 million, adding roughly 2,000 miles of California pipelines. Financing activities included a $550 million notes offering at 7.25% due 2035, which fully redeemed the higher-cost 2029 notes, and an amendment to the credit facility that trimmed borrowing costs. Marketing disputes shaved $25 million from Q2 pre-tax income, though the company expects to prevail. The board declared a $0.405 quarterly dividend, and the share buyback program retains $600 million in capacity. With $1.3 billion in liquidity and a reaffirmed $1.5 billion borrowing base, CRC remains well-positioned despite commodity price volatility.