ShaMaran Petroleum (SNM) Q3 2025 earnings summary

Executive summary

• Restart of international oil exports via the Iraq-Türkiye pipeline (ITP) on September 27, 2025, following interim agreements between the KRG, Government of Iraq, and IOCs, including compensation terms and recognition of PSCs.

• Reopening of the Iraq-Türkiye pipeline after over two years enabled resumption of exports at full contractual entitlement and international prices, improving revenue potential.

• Q3 2025 impacted by a drone strike in July, causing a seven-day shutdown and subsequent production losses, but full production restored by late September.

• Interim agreements set compensation at $16 per barrel for an initial period, with reconciliation to full PSC entitlement expected in coming months.

• Net income for Q3 2025 was $1.9 million, with revenue of $28.9 million, both slightly lower year-over-year due to operational disruptions.

Financial highlights

• Q3 2025 revenue was $28.9 million, down 2% from Q3 2024, mainly due to the drone strike, partially offset by four days of international price sales.

• Gross margin on oil sales in Q3 2025 was $9.3 million, 7% lower year-over-year; nine-month gross margin up 43% to $34.5 million.

• Adjusted EBITDAX for Q3 2025 was $17.9 million, down 18% year-over-year; nine-month Adjusted EBITDAX up 28% to $67.2 million.

• Cash flow from operating activities in Q3 2025 was $5.9 million, down 80% year-over-year due to delayed receipts and higher repair costs; free cash flow before debt service was $4.8 million, a 78% decrease year-over-year.

• Cash position at quarter-end was $54.7 million, with net debt at $89.1 million.

Outlook and guidance

• Interim export agreements are valid through December 31, 2025, with uncertainty about extension or renegotiation, especially given upcoming Iraqi elections.

• Türkiye has notified Iraq of intent to terminate the ITP agreement in July 2026, creating risk of future export disruptions.

• Ongoing discussions with KRG regarding recovery of outstanding receivables; timing remains uncertain.