What Gulfport Energy (GPOR) Said on Its Q3 Earnings Call

Key Points

• Gulfport plans to prioritize Appalachia in 2027, starting with two rigs while reducing Oklahoma activity. Continuous drilling, longer wet-gas wells and an electric fracturing fleet could cut drilling and completion costs per foot by more than 20% by 2028.
• Production, capital spending and operating costs were in line with guidance, and the company said its higher-liquids mix helped lift EBITDA and adjusted free cash flow. Gulfport expects adjusted free cash flow to grow more than 15% in 2026 from 2025 at $3 gas, with a double-digit free cash flow yield in 2027 at that price.
• Gulfport expanded its share-repurchase authorization by 33% to $2 billion and has bought back about $1.2 billion of stock so far. It also signed gas supply agreements covering about 10% of forecast Appalachian production over their terms and plans further Ohio acreage purchases.

Gulfport Energy NYSE: GPOR plans to move toward continuous two-rig operations in Appalachia and reduce activity in Oklahoma in 2027, a shift executives said could lower drilling and completion costs and drive a free cash flow increase in 2028.

President and CEO Nick Dell’Osso said on the company’s third-quarter earnings call that production, capital spending and operating costs were in line with guidance. Liquids accounted for 13% of production, supported by recent wet-gas Utica wells brought online. He said the higher-value production mix, strong realized liquids prices and cost discipline helped lift EBITDA and adjusted free cash flow from the second quarter.

The company remains on track to operate within its original 2026 guidance ranges, Dell’Osso said. Gulfport expects adjusted free cash flow to grow more than 15% from 2025 at $3 gas and anticipates a double-digit free cash flow yield in 2027 at the same gas price.

Appalachia investment and cost savings

Gulfport sees a path to reduce drilling and completion costs per foot by more than 20% between now and 2028, Dell’Osso said. The plan combines continuous drilling, development of long-lateral wet-gas pads and an electric fracturing fleet scheduled to begin service in mid-2027.

The fleet is expected to reduce diesel exposure and completion spending. Dell’Osso said the move to a more active Appalachian program made the fleet commitment easier to undertake. The commitment runs for 18 months, but Gulfport can sublease the fleet or work with the vendor to allow other users if activity declines, he said.

Executive Vice President and Chief Operating Officer Matthew Rucker said Gulfport had incorporated expected service costs into its 2027 assumptions. Without the planned efficiency gains, the company would have expected approximately 5% inflation in its typical development program, he said.

Gulfport will start 2027 with two rigs, as it typically does, but has not issued formal guidance or committed to the full-year activity schedule. Dell’Osso said the company wants to get through winter, finalize vendor arrangements and prepare its pads before releasing guidance alongside fourth-quarter earnings.

Gas contracts and acreage

Gulfport signed an additional gas supply agreement for the Upper Midwest beginning in the fourth quarter of 2028. Dell’Osso said the deal locks in a more attractive spread to regional pricing points than the company has historically received while retaining floating exposure to those markets.

Together with a 10-year Ohio supply agreement beginning in mid-2027, the contracts cover about 10% of forecast Appalachian production over their respective terms, he said. Both use firm transportation capacity Gulfport already holds. Dell’Osso said the company is open to additional agreements if the economics are attractive.

On acreage, Gulfport closed $83 million of Ohio state land acquisitions during the third quarter and expects to spend another $50 million to $55 million before year-end under its $140 million discretionary program for 2026. Dell’Osso said the company plans to continue pursuing acreage in 2027 but has not set a budget.

Oklahoma reassessment and shareholder returns

In Oklahoma’s SCOOP region, Gulfport intends to reduce 2027 activity while reviewing development opportunities beyond its historical primary target. Rucker said the company is examining the Springer and Sycamore formations and the deeper, dry-gas portion of the Woodford, including data from wells in which it participates on a nonoperated basis. Gulfport has historically drilled in the Woodford condensate window, he said.

Gulfport also increased its share repurchase authorization by 33% to $2 billion. It has repurchased approximately $1.2 billion of stock since the program began, Dell’Osso said.

Buybacks will compete for capital with acreage purchases, balance sheet improvements and drilling activity, he told analysts. He expects leverage, which rose during the third quarter following the state land acquisition, to return to about one times by year-end.

About Gulfport Energy (NYSE:GPOR)

Gulfport Energy Corporation is an independent exploration and production company focused on developing natural gas and associated natural gas liquids. The company's operations are concentrated primarily in the Utica Shale in eastern Ohio, where it drills, completes and produces unconventional oil and gas wells.

Gulfport's product mix includes natural gas, natural gas liquids and condensate. Its activities include leasing and managing mineral acreage, operating horizontal wells and coordinating gathering, processing and transportation arrangements needed to deliver production to market.

Founded in 1997, Gulfport historically operated in several U.S.

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