'2025 was a year of significant progress for Harbour. We delivered excellent operational performance while maintaining capital discipline and integrating new assets. This drove record production and higher free cash flow against a backdrop of lower commodity prices. In addition, we improved our cost structure, built momentum at our growth projects in Mexico and Argentina, and announced three significant transactions. Together these actions position Harbour’s portfolio to deliver higher margin production over the coming years, leading to material growth in free cash flow.
Today we also announced details of our new distributions policy that links shareholder returns directly to free cash flow. The policy strikes the right balance across the commodity price cycle between our commitment to a strong balance sheet, unlocking the potential of our portfolio and delivering attractive shareholder returns.
2026 is off to a strong start. Production over the first two months of the year averaged 509 thousand barrels per day and we completed the LLOG transaction on 11 February, marking our entry into the US deepwater Gulf. Looking ahead, our focus remains on safety, operational excellence, advancing our growth projects, strengthening the balance sheet and completing the Waldorf and Indonesia transactions,' said Linda Z Cook, Chief Executive Officer.
Excellent operational delivery
- Record production of 474 kboepd (2024: 258 kboepd), up 84%
- Unit operating costs reduced by 22% to $12.8/boe (2024: $16.5/boe)
- Total recordable injury rate (TRIR) of 1.1 per million hours worked (2024: 1.0)
- New wells and projects online in the UK, Norway, Argentina and Egypt
- Exploration and appraisal successes in Egypt and Norway
- 2P reserves and 2C resources of 3.0 bnboe at year end (2024: 3.2 bnboe)
Material strategic progress
- Appointed operator of the 750 mmboe gross recoverable Zama oil field (Mexico, Harbour 32%) and a new, more capital efficient, phased FPSO-based development plan agreed
- Construction underway at Southern Energy (Argentina), a 6 mtpa LNG project (Harbour 15%) due to commence operations end 2027
- Exited Vietnam; announced Indonesia divestments for $215 million with completion expected in Q2 2026
- Announced $170 million acquisition of Waldorf (UK) with the potential to unlock significant financial synergies including UK tax losses with an expected value of $900 million. Completion expected end Q2 2026
- Post period end, completed the $3.2 billion LLOG acquisition, securing a fully operated, oil weighted portfolio in the deepwater US Gulf with a long reserve life, a compelling growth outlook and significant running room
Financial highlights1
- Realised post-hedge oil and European gas prices of $69/bbl and $13/mscf (2024: $82/bbl and $11/mscf)
- Increased revenue and other income of $10.3 billion (2024: $6.2 billion) and adjusted EBITDAX of $7.2 billion (2024: $4.1 billion)
- Increased free cash flow of $1.1 billion (2024: $0.1 billion)
- Increased adjusted profit after tax of $0.6 billion (2024: $0.4 billion), equating to adjusted earnings per voting ordinary share of 31 cents (2024: 33 cents)
- Reported loss after tax of $0.2 billion (2024: $0.1 billion), reflecting a 106% effective tax rate and impacted by a $0.3 billion deferred tax charge associated with changes to the UK fiscal regime and $0.7 billion of pre-tax impairments and exploration write-offs in our North Africa, Mexico and CCS portfolios
- Investment grade credit ratings of Baa2 (negative outlook), BBB- and BBB- (credit watch negative) by Moody’s, Fitch and S&P, respectively
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See Glossary for the definition of non-IFRS measures used in this section.
Shareholder distributions
Harbour has adopted an updated distributions policy which links shareholder returns directly to free cash flow and strengthens our capital allocation framework across the commodity price cycle. The new policy includes a base dividend and supports deleveraging alongside disciplined investment in attractive organic growth opportunities in the near term. This will underpin future production and free cash flow growth, driving enhanced shareholder returns over time.
- Since 2022, Harbour has on average returned c.40% of annual free cash flow to shareholders
- Under the new policy, Harbour will target returning 45-75% of free cash flow each year, including an initial base dividend of 16.10 cents/voting ordinary share ($300 million(1))
- While leverage is above 1.0x, Harbour expects to pay out towards the lower end of the range, prioritising debt reduction. As leverage falls below 1.0x, Harbour expects to pay out towards the top end of the range
- In line with the new policy, Harbour has declared a 2025 final dividend of 8.05 cents/voting ordinary share ($150 million2). This brings total distributions for 2025 to $478 million, representing a c.45% free cash flow payout
2026 guidance and outlook
2026 guidance and outlook is updated to include the impact of the LLOG acquisition and assumes completion of the Indonesia and Waldorf (UK) transactions end Q2 2026:
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For 2026 Harbour now expects:
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Production of 475-500 kboepd. Production to end February averaged 509 kboepd including one month’s contribution from LLOG
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Unit operating costs of c.$14.5/boe
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Total capital expenditure of $2.2-2.4 billion, reflecting additional expenditure relating to the LLOG and Waldorf acquisitions
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Free cash flow of c.$0.6 billion(3), assuming $65/bbl Brent and $11/mscf European gas prices. A $5/bbl change in Brent or $1/mscf change in European gas prices for the full year impacts our 2026 free cash flow by c.$170 million or c.$150 million respectively
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Beyond 2026:
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Production is expected to be maintained in the range of 475-500 kboepd through to 2030, supported by total capex of $2.0-2.3 billion per annum with unit operating costs less than $15/boe
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Annual free cash flow expected to increase to c.$1.0 billion in 2028(4), driven by the LLOG and Waldorf acquisitions
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Further free cash flow margin growth expected around the end of the decade, driven by continued growth from the LLOG portfolio and as Harbour’s Mexico projects come onstream
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With anticipated additions to reserves in Argentina, Mexico, Norway and the US Gulf, the 2P reserves replacement ratio for the period year end 2025 to 2028 is projected to be over 100 per cent
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Net debt on completion of LLOG was $7.2 billion with leverage anticipated to be slightly above Harbour’s target of <1.0x at year end 2026, reducing to 1.0x in 2028
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Includes $46 million initial base dividend paid on non-voting ordinary shares
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Includes $23 million initial base dividend paid on non-voting ordinary shares
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Excludes one off transactions costs of c.$0.2billion
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Reflects $65/bbl and $11/mscf for 2026 and $70/bbl and $10/mscf 2027 onwards escalated at 2.5% in line with costs
