Surge Energy Pairs Record Production with Top-Tier Sustainability in 2025

HOUSTON, TX – April 24, 2026 – In a year marked by both opportunity and scrutiny for the energy sector, independent oil and gas producer Surge Energy has announced a landmark 2025 performance, demonstrating that robust financial returns and significant environmental stewardship can be achieved in tandem. The Houston-based company, which focuses its operations in the prolific Midland Basin of West Texas, reported its highest-ever annual production levels alongside a suite of sustainability achievements that set a high bar for the industry.

Surge Energy's 2025 results paint a picture of a company firing on all cylinders, achieving record output while aggressively paying down debt and investing in environmental initiatives. This dual-pronged success offers a compelling case study in an industry navigating the complex demands of the modern economy: providing essential energy while mitigating environmental impact.

A Financial Fortress in the Permian

Financially, Surge Energy’s 2025 performance was nothing short of remarkable. The company delivered its highest annual production in history, averaging 64,403 net barrels of oil equivalent per day. This operational success translated directly into exceptional financial health, marking the company’s sixth consecutive year of generating free cash flow.

This consistent cash generation has allowed Surge to build a formidable balance sheet. The company grew its cash balance to $590 million by year-end 2025, while simultaneously reducing its net debt to a mere $160 million. The most telling metric of this financial discipline is its leverage ratio, which stood at an industry-leading 0.2x. In a capital-intensive industry where leverage below 1.0x is considered healthy, a ratio of 0.2x is exceptionally low and signals a level of financial resilience that gives the company significant flexibility for future investment, weathering market volatility, and continued growth.

This aggressive deleveraging and focus on free cash flow reflect a broader shift in the U.S. shale industry, where investors have moved from rewarding growth-at-all-costs to demanding capital discipline and shareholder returns. Surge Energy's results place it at the vanguard of this new paradigm, showcasing a model of efficient, profitable, and financially prudent operations.

Redefining Environmental Responsibility in Oil Extraction

While the financial metrics are impressive, it is how Surge achieved them that completes the story. The company has heavily integrated sustainability into its operational DNA, focusing on tangible actions that reduce its environmental footprint.

One of the most critical challenges in the arid Permian Basin is water management. Surge has tackled this head-on with a large-scale water recycling program. Since 2017, the company has conserved over 7 billion gallons of fresh water by treating and reusing its produced water for completion operations. This strategy not only conserves a precious regional resource but also reduces operating expenses and minimizes the need for wastewater disposal wells, which have been linked to induced seismicity in the region. To support this, the company has made significant investments in a network of water pipelines, which has eliminated an estimated 4.2 million truck trips since its inception. This move alone has prevented approximately 124,000 metric tons of CO2 equivalent emissions from entering the atmosphere.

Beyond water management, Surge has targeted emissions at the wellsite. Its dual-fuel completion fleet program, which utilizes cleaner-burning natural gas, has prevented over 60,000 metric tons of CO2e emissions since it began, with 11,000 tons eliminated in 2025 alone. Underscoring this commitment to responsible operations is an impeccable safety record: the company reported zero employee recordable injuries for the fifth consecutive year, a statistic that points to a deeply embedded culture of safety that is considered exceptional within the industry.

Proactively Addressing Legacy Liabilities

Further distinguishing Surge Energy's approach is its proactive management of environmental liabilities. In 2023, the company initiated a focused Plug and Abandonment (P&A) program to address its inactive wells. These non-producing wells can pose environmental risks, including potential methane leaks and groundwater contamination, and represent a future financial liability for operators.

Rather than deferring the issue, Surge has actively worked to decommission these sites. Since the program's start, the company has successfully plugged and abandoned 104 wells. This has dramatically reduced its inactive well count by 91% for its Moss Creek asset, effectively erasing a significant environmental and financial liability from its books. This forward-looking strategy demonstrates a commitment to responsible asset stewardship that extends throughout the entire lifecycle of a well, not just its productive years.

A Blueprint for the Modern Energy Company

In his statement, Chief Executive Officer Linhua Guan celebrated a "record-breaking year" and praised the Surge team of over 200 Texans for delivering "impressive financial and operational results in a responsible manner." This sentiment captures the essence of the company's 2025 achievements.

By successfully integrating top-tier financial discipline with leading environmental practices, Surge Energy provides a compelling blueprint for navigating the complexities of the modern energy landscape. The company's strategies directly address some of the most significant operational and environmental challenges in the Permian Basin, from water scarcity and seismicity to emissions and infrastructure strain. This integrated approach of operational excellence and environmental foresight appears to be the cornerstone of Surge Energy's strategy for its next decade of growth in West Texas.