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Highlights

  • Q1 2025 revenue rose 7% YoY to $5.1 million, driven by higher natural gas prices.

  • Natural gas price realized: $4.14/Mcf (up from $2.53/Mcf in Q1 2024), a 13% premium to NYMEX.

  • Production declined 29% to 12,808 Mcfe/d due to asset optimization.

  • Net loss widened to $3.9 million, up from $3.1 million in Q1 2024.

  • Adjusted funds flow from operations reached $0.9 million, excluding one-time costs.

  • Closed $5.0 million equity financing and converted $3.1 million in debentures in April 2025.

  • Loan amendments provide covenant relief and defer repayments until 2025.

  • Maintains hedge of 5,000 MMBtu/d at $3.40/MMBtu through December 2026.

Southern Energy Corp. (TSXV:SOU / LSE:SOUC), a U.S.-focused natural gas producer, reported a 7% year-over-year increase in Q1 2025 revenue to $5.1 million, despite a significant 29% drop in production. The revenue boost was driven by recovery in natural gas prices, with the company securing an average of $4.14/Mcf, significantly outperforming the NYMEX Henry Hub benchmark by 13%.

The company’s natural gas-heavy production base—96% of its total output—averaged 12,808 Mcfe/d (2,135 boe/d) during the quarter. However, the reduced output led to a net loss of $3.9 million, up from $3.1 million a year ago, though adjusted funds flow from operations still came in at $0.9 million.

Financial Restructuring and Equity Raise

In Q1, Southern secured revised terms on its senior secured term loan, including:

  • Extension of principal repayment pause to January 2025,

  • Reduced minimum repayment to $1.45 million, which has been paid,

  • Asset coverage ratio adjusted to 1.5x, and

  • Reduced Tranche B capacity to $5 million.

In April 2025, Southern raised $5 million in new equity and converted $3.1 million in convertible debentures into equity, removing debt from the balance sheet and enhancing liquidity.