How much cash does Spartan Delta really make, and what is a share of it worth?

The words on this page

Real cash (true cash)

What was left in the bank each year after every bill, every tax payment and every well drilled. Not profit, and not "cash flow" as companies usually quote it, which leaves the drilling out. The strictest number there is.

Required return

The yearly return you insist on for taking the risk. A dollar promised in ten years is worth less than a dollar today; this rate says how much less. 9% is a common professional figure for a large Canadian producer; the reserve engineers use 10%.

Well life (reserve life)

How long the wells keep producing. After the life you choose, nothing is counted. McDaniel evaluated 329.9 million boe of proved plus probable reserves at 31 December 2025 (197.2 million proved). Against 2025's average of 42,559 boe a day that is a 21.2 year 2P reserve life and 12.7 years proved; McDaniel's own reserve life index on forecast production is 18.1 and 10.8 years.

What a share is worth

Every future year's cash, shrunk back to today's dollars at your required return, added up, less the debt, less the cost of cleaning up the wells, divided by the number of shares. Pay less than this and you earn more than your required return; pay more and you earn less.

Where the default growth comes from

2026 guidance of 53,500 to 54,500 boe a day sits about 27 per cent above 2025's average of 42,559, and the Duvernay plan targets 50,000 boe a day from that play by 2030; a 10 per cent dial is a tempered ten-year take on that ramp.

The arithmetic, step by step

1. Count the real cash each past year: cash generated by operations as reported, plus interest paid put back, minus rent on leases, minus every dollar spent on wells and plants. Buying and selling assets is shown separately.
2. Project it. The starting cash you choose (an average of the history, or the latest year) grows at your growth dial for ten years, then at the long-run rate for as long as the wells keep producing. Nothing is counted after the well life ends.
3. Bring it back to today. Each year's cash is shrunk by your required return, counted at mid-year because cash arrives through the year rather than on 31 December.
4. Turn it into a share value. Add up the shrunk cash; take off net debt of C$221M; take off the C$80M cost of cleaning up the wells if that switch is on; divide by 205.15M shares.
5. Work it backwards. "The growth today's price assumes" is the ten-year growth rate at which this start is worth exactly the share price.

Where the numbers come from

• Operating cash flow, interest paid, lease payments, capital spending, acquisitions and dividends were hand-checked line by line against the audited annual financial statements for every year; the remaining lines (share counts, net income, production) come from the same statements and the company's results releases.
• Six years is the entire modern history and it is short of the model's preferred ten: before the Spartan team recapitalized the shell in 2020 there was no comparable business. 2020 itself is a part-year ramp built on the Spirit River, Cardium and Bellatrix deals closed mid-year.
• The history has a cliff in it. In May 2023 Spartan sold its Gold Creek and Karr Montney assets to Crescent Point for about $1.70 billion cash, spun its early-stage Montney to Logan Energy, and declared $1.7 billion ($9.60 a share) of dividends and distributions; $1,597.6 million of cash went out the door that year. Production of 73,084 boe a day in 2022 versus 38,166 in 2024 is the same ticker but not the same asset base, so averages that span 2023 mix two different companies.
• The 2021 acquisition figure of $751.4 million is the audited cash cost of the Velvet and Inception deals including debt repaid on closing; aggregated data shows only $327.9 million. Part of the consideration was also paid in shares, which no cash line captures.
• The latest year's true cash is deeply negative on purpose: 2025 capital spending of $359.3 million and the $525 to $575 million 2026 program are a deliberate Duvernay build that outruns operating cash flow for now. The growth dial is doing real work in this model.
• Net debt is debt plus lease liabilities minus cash. Spartan's own measure, which adds the adjusted working capital deficit, was $203.9 million at year-end 2025 and $300.4 million at 30 June 2026 versus the $221.2 million used here. A $150.8 million dividends-payable balance from the 2023 distributions still sits in working capital against restricted cash.
• The 2020 net debt of $47.1 million is lease obligations less cash because the company carried no bank debt at that year-end; Spartan's own 2020 net debt measure was $12.3 million.
• Interest for all six years is the audited cash paid for interest and fees on debt from the supplemental cash flow note of each year's audited statements.
• No share buybacks in the period; returns have come as dividends and distributions. The 2024 dividend line is a $53 thousand residual, shown as 0.053.
• Analyst targets: average C$15.77 across 11 analysts (stockanalysis.com analyst consensus, 28 August 2026).

For the technically minded

The method is the one used to evaluate capital projects, from Ted Lawrence, The Business Guide to Economic Evaluations: Projects, Leases, Tariffs and Acquisitions (2017). "Real cash" is the book's project cash flow (chapter 3) with depreciation, debt servicing and debt-like leases restructured out (chapters 4, 5 and 19); short operating leases stay in as a cost of producing, a chapter 19 judgment. The value per share follows the share-purchase evaluation of chapter 20: present value of the company's cash flows at the cost of capital (chapter 10), mid-year discounting (chapter 12), plus non-required assets, less net debt and the decommissioning liability. "What you gain or lose" is the bid-curve NPV of chapter 20; "when you get your money back" is the discounted payout of chapter 13; the bars follow the project profile of chapter 6. The reverse solve on growth is a plain reverse DCF.

Discount-rate anchors: 9% is a common cost-of-equity figure for a large Canadian producer and 10% is the reserve-report convention (PV10). The long-run rate defaults to 0% here: a depleting resource should not be assumed to grow forever, so anything above zero is a judgment you make with the dial.