JX ENERGY (03395) announced that during a board meeting held on November 4, 2025 (Calgary time), the board reviewed short-term cash flow enhancement strategies proposed by the management team. These strategies include hedging a portion of the company's natural gas production to improve cash flow stability in 2026. The estimated 2025 AECO 5A (average daily index) price is approximately CAD 1.62 per gigajoule, while the 2026 AECO 5A price is expected to be higher. The company plans to hedge over 50% of its 2026 production at prices above CAD 3.00 per gigajoule. As of the announcement date, about 40% of the company's 2026 production capacity has already been hedged at an average price of CAD 3.06 per gigajoule.
On July 25, 2025 (Hong Kong time), the company disclosed its 9.6 MW natural gas power project, which is progressing as planned through necessary regulatory approval processes. In addition to this project, the board has approved the development of a 4.7 MW natural gas power project. This new project will involve the construction of five 0.94 MW generator units—four at the company's existing well sites and one at the JX ENERGY (Canada) site. Upon completion, the company will be able to independently generate and sell electricity, thereby enhancing the overall value of its natural gas production. No additional regulatory approvals are required for this project.
Based on quotes from independent suppliers in China and the management's past experience, the board currently estimates the engineering, procurement, and construction (EPC) phase costs to be approximately CAD 3 million. EPC payments will be made in stages and may be adjusted further based on subsequent quotes from other independent suppliers and prevailing market conditions.
To fund the development of this project, the company plans to raise capital through equity financing, including the issuance of new shares. Any such financing arrangements are subject to further approval by the board and The Stock Exchange of Hong Kong Limited. As of the announcement date, the company has not entered into any understandings, arrangements, or agreements with any parties regarding the above plans.