BKV Corporation (NYSE: BKV) posts Q2 profit and details 2026 power and CCUS growth
Rhea-AI Filing Summary
BKV Corporation reported Q2 2026 results with net income attributable to BKV of $75.8 million ($0.67 diluted EPS) and Adjusted Net Income of $50.7 million ($0.46 diluted Adjusted EPS). Adjusted EBITDAX attributable to BKV was $142.0 million, while net cash provided by operating activities was $109.7 million and Adjusted Free Cash Flow before Power Growth attributable to BKV was $40.0 million.
Average net production reached 978.3 MMcfe/d and total power generation from the Temple plants was 2,222 GWh. Management highlighted strong upstream execution, including an Upper Barnett well that reduced the expected breakeven price from $3.75/MMBtu to $3.25/MMBtu. CCUS operations sequestered approximately 35,900 metric tons of CO₂ in the quarter, and Cotton Cove and Eagle Ford CCUS projects began commercial operations, while Barnett Zero reached about 375,800 metric tons cumulatively since 2023.
As of June 30, 2026, BKV had $836.7 million of total liquidity, including $152.2 million of cash and $684.5 million of RBL capacity, against total debt of $1.3 billion, resulting in a Net Leverage Ratio of 1.78x. The company updated Q3 and full-year 2026 capital, production, cost and power Adjusted EBITDAX guidance, and an amendment also corrects a prior EDGAR exhibit submission error without changing these results.
Positive
- Adjusted EBITDAX attributable to BKV rose to $142.0 million in Q2 2026, compared with $96.5 million in Q2 2025, indicating stronger earnings before interest, taxes, depreciation, depletion, amortization and specified non‑cash or nonrecurring items.
- Adjusted Net Income attributable to BKV increased to $50.7 million ($0.46 diluted Adjusted EPS) from $24.1 million ($0.28) in Q2 2025, reflecting improved performance after adjusting for unrealized derivatives, forward gas settlements, impairments and other nonrecurring items.
- Average net production grew to 978.3 MMcfe/d in Q2 2026 from 811.0 MMcfe/d a year earlier, with total quarterly volumes rising to 89,021 MMcfe, supported by Barnett operational improvements and advanced completion designs.
- Total liquidity reached $836.7 million at June 30, 2026, consisting of $152.2 million in cash and cash equivalents and $684.5 million of available RBL capacity, alongside a Net Leverage Ratio of 1.78x, supporting ongoing investment and debt service capacity.
- CCUS and power platforms advanced materially, with Cotton Cove and Eagle Ford CCUS projects beginning commercial operations and Temple plants increasing power generation to 2,222 GWh, while work continued on long-term power purchase agreements and additional generation capacity.
Negative
- GAAP net income attributable to BKV declined to $75.8 million in Q2 2026 from $107.8 million in Q2 2025, indicating lower reported earnings despite stronger non‑GAAP metrics and higher production.
- The power segment recorded a Q2 2026 net loss of $6.8 million, compared with net income of $14.9 million a year earlier, as lower average power prices of $41.59/MWh offset the benefit of higher generation volumes.
Filing Explained
As of June 30, 2026, BKV reported 109,417 thousand shares outstanding and $185,504 thousand of six-month issuance proceeds; terms remain undisclosed.
The August 6 8-K/A leaves the reported second-quarter results unchanged and states that the earnings release and investor presentation are furnished, not deemed filed or incorporated by reference. Its six-month cash-flow statement reports
Under the supplied dilution definition, issuing additional shares increases the total share count and reduces an existing holder’s percentage ownership absent offsetting changes. The filing therefore documents a larger common-share base for existing holders, but it does not establish that the amendment itself issued new shares.
The August 6 filing does not state the issuance price, recipients, use of proceeds, or conversion mechanics, so the per-share ownership and economic terms cannot be sized from this disclosure; those details would require another filing.
8-K Event Classification
3 items: 2.02, 7.01, 9.01
3 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Net income attributable to BKV (Q2 2026): $75.8 million
Adjusted Net Income attributable to BKV (Q2 2026): $50.7 million
Adjusted EBITDAX attributable to BKV (Q2 2026): $142.0 million
+5 more
8 metrics
Net income attributable to BKV (Q2 2026)
$75.8 million
Three months ended June 30, 2026; $107.8 million in Q2 2025
Adjusted Net Income attributable to BKV (Q2 2026)
$50.7 million
Non-GAAP; three months ended June 30, 2026 vs $24.1 million in Q2 2025
Adjusted EBITDAX attributable to BKV (Q2 2026)
$142.0 million
Non-GAAP; three months ended June 30, 2026 vs $96.5 million in Q2 2025
Net cash provided by operating activities (Q2 2026)
$109.7 million
Three months ended June 30, 2026; $89.3 million in Q2 2025
Average net production (Q2 2026)
978.3 MMcfe/d
Upstream/Midstream segment; three months ended June 30, 2026 vs 811.0 MMcfe/d in 2025
Total power generation (Q2 2026)
2,222 GWh
Temple I and II combined; three months ended June 30, 2026; ~16% increase year over year
Total liquidity
$836.7 million
As of June 30, 2026; includes $152.2 million cash and $684.5 million RBL capacity
Net Leverage Ratio
1.78x
As of June 30, 2026; net debt of $1,081.6 million divided by annualized Adjusted EBITDAX
Key Terms
Adjusted EBITDAX, Net Leverage Ratio, Section 45Q tax credits, capacity factor, +1 more
5 terms
Adjusted EBITDAX financial
"Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 142.0"
Adjusted EBITDAX is a measure of a company’s operating profit that adds back interest, taxes, depreciation, amortization and specific recurring costs (often exploration or similar project expenses), then removes one‑time or unusual items to show recurring cash profitability. Investors use it like a clean yardstick—ignoring financing choices, accounting rules and one‑off events—to compare core performance across periods or peers and assess a business’s ability to generate cash from operations.
Net Leverage Ratio financial
"Net Leverage Ratio of 1.78x"
The net leverage ratio measures how much debt a company has compared to its available assets or earnings, after accounting for its cash and liquid assets. It helps investors understand how heavily a company relies on borrowed money to finance its operations and growth. A higher ratio indicates greater financial risk, while a lower ratio suggests a more cautious approach to borrowing.
Section 45Q tax credits regulatory
"Section 45Q tax credits | | 3,048"
capacity factor technical
"Temple I capacity factor | 69.2 % | | 64.0 %"
Capacity factor is the percentage of time a power plant or energy asset actually produces electricity compared with the maximum it could produce if it ran at full output continuously. For investors it shows how much revenue and value to expect from the asset — like judging a car by how often it’s driven near top speed rather than its top speed alone — and helps compare different technologies, project reliability, and cash‑flow forecasts.
carbon capture, utilization and sequestration technical
"power generation; and carbon capture, utilization and sequestration."
Earnings Snapshot
Net income attributable to BKV (Q2 2026): $75.8 million · Guidance included
Three and six months ended June 30, 2026
Net income attributable to BKV (Q2 2026)
$75.8 million
vs $107.8 million in Q2 2025
Adjusted Net Income attributable to BKV (Q2 2026)
$50.7 million
vs $24.1 million in Q2 2025
Adjusted EBITDAX attributable to BKV (Q2 2026)
$142.0 million
vs $96.5 million in Q2 2025
Net cash provided by operating activities (Q2 2026)
$109.7 million
vs $89.3 million in Q2 2025
Average net production (Q2 2026)
978.3 MMcfe/d
vs 811.0 MMcfe/d in Q2 2025
Guidance
Updated Q3 2026 guidance includes total capital expenditures of $200–$285 million, net production of 935–965 MMcfe/d, and Power Adjusted EBITDAX of $45–$65 million. Full-year 2026 guidance includes total capital expenditures of $690–$875 million, net production of 940–960 MMcfe/d, and Power Adjusted EBITDAX of $135–$175 million.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were BKV (BKV) net income and EPS for Q2 2026?
BKV reported Q2 2026 net income attributable to BKV of $75.8 million, or $0.67 per diluted share. This compares with $107.8 million, or $1.27 per diluted share, in Q2 2025, reflecting lower GAAP earnings even as production and non‑GAAP results improved.
How did BKV (BKV) Adjusted EBITDAX and Adjusted Net Income perform in Q2 2026?
In Q2 2026, BKV generated Adjusted EBITDAX attributable to BKV of $142.0 million and Adjusted Net Income of $50.7 million. These rose from $96.5 million and $24.1 million, respectively, in Q2 2025, indicating stronger underlying operating performance after adjusting for specified items.
What were BKV (BKV) production and pricing metrics in Q2 2026?
Average net production was 978.3 MMcfe/d, up from 811.0 MMcfe/d a year earlier, with total volumes of 89,021 MMcfe. Natural gas realized prices including derivatives were $2.60/Mcf, NGL prices including derivatives were $25.21/Bbl, and oil realized prices averaged $86.91/Bbl.
What are BKV (BKV)’s liquidity, debt and Net Leverage Ratio as of June 30, 2026?
As of June 30, 2026, BKV reported $836.7 million of total liquidity, including $152.2 million in cash and cash equivalents and $684.5 million of RBL availability. Total debt was $1.3 billion, resulting in a Net Leverage Ratio of 1.78x based on annualized Adjusted EBITDAX.
What progress did BKV (BKV) report on its power and CCUS projects in Q2 2026?
BKV increased Temple I and II generation to 2,222 GWh and continued PPA discussions, while securing additional Temple acreage and air permits. In CCUS, Cotton Cove and Eagle Ford entered commercial operations and projects sequestered about 35,900 metric tons of CO₂ during the quarter.
What are BKV (BKV)’s 2026 capital expenditure and production guidance ranges?
For full-year 2026, BKV guides to $690–$875 million of total capital expenditures and net production of 940–960 MMcfe/d. Development capex is projected at $200–$280 million, with Power strategic capital and investments plus maintenance at $400–$475 million and CCUS and other at $90–$120 million.
What Power Adjusted EBITDAX does BKV (BKV) expect for 2026?
BKV’s guidance calls for Power Adjusted EBITDAX of $45–$65 million in Q3 2026 and $135–$175 million for full-year 2026. This reflects expectations for Temple plant performance, power pricing, and the impact of its broader power strategy and hedging activities.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 6, 2026
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | ||||
Registrant’s telephone number, including area code: (720) 375-9680
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x
EXPLANATORY NOTE
This Amendment No. 1 to the Current Report on Form 8-K filed on August 6, 2026 is being filed solely to correct an EDGAR filing error. In the Original Report, the Form 8-K report was inadvertently included as an exhibit, and the exhibit was inadvertently submitted as the primary filing document. This Amendment includes the Current Report on Form 8-K and the exhibit in their proper locations. No other changes have been made to the Original Report.
Item 2.02. Results of Operations and Financial Condition.
Attached as Exhibit 99.1 is the registrant’s earnings release for the second quarter of 2026, issued August 6, 2026 . This release is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise incorporated by reference into any filing pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as otherwise expressly stated in such filing.
Item 7.01. Regulation FD Disclosure.
On August 6, 2026 , BKV posted an investor presentation on its website. The presentation may be found on BKV’s website at https://www.bkv.com by selecting “Investors,” “News & Events” and then “Presentations.”
The information in the investor presentation and consolidating statements are being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act, or otherwise incorporated by reference into any filing pursuant to the Securities Act, or the Exchange Act, except as otherwise expressly stated in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number | Description | |||||||
99.1 | Press Release, dated August 6, 2026 | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BKV Corporation | ||||||||
| By: | /s/ David R. Tameron | |||||||
David R. Tameron | ||||||||
Chief Financial Officer | ||||||||
Exhibit 99.1
BKV Corporation Reports Second Quarter 2026 Financial and Operational Results and Updated 2026 Guidance
DENVER, Colorado – August 6, 2026 – BKV Corporation (“BKV” or the “Company”) (NYSE: BKV), today reported financial and operational results for the second quarter of 2026 and updated guidance for the third quarter and full year of 2026.
Second Quarter 2026 Highlights
•Net income attributable to BKV of $75.8 million or $0.67 per diluted share
•Adjusted Net Income attributable to BKV of $50.7 million or $0.46 per diluted share
•Adjusted EBITDAX attributable to BKV of $142.0 million
•Net cash provided by operating activities of $109.7 million
•Net cash provided by operating activities before working capital of $117.6 million
•Accrued capital expenditures of $72.4 million
•Adjusted Free Cash Flow before Power Growth attributable to BKV of $40.0 million
•Average net production of 978.3 MMcfe/d
•Total generation from the Power JV’s Temple plants of 2,222 GWh
•CCUS quarterly sequestration of approximately 35,900 metric tons of CO2 equivalent
•Net Leverage Ratio of 1.78x
•Commenced commercial operations at the Cotton Cove and Eagle Ford CCUS projects, which combined are expected to sequester more than 120,000 metric tons of CO₂ waste annually
“Our performance this quarter reflects the consistency of our execution,” said Chris Kalnin, Chief Executive Officer of BKV. “We met or exceeded our operating targets while advancing each of our strategic priorities. During the quarter, we brought two additional carbon capture projects into operation, delivered strong results across our upstream business, and advanced commercial discussions toward a long-term power purchase agreement.”
“Our strategy has always been to build from a position of operational strength. That disciplined approach continues to create new opportunities across our power and carbon capture businesses while reinforcing the strong operational foundation of our upstream operations. Together, these complementary businesses position us to create long-term value for our shareholders.”
1
Financial Results
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
($ Millions, except EPS)(1) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income attributable to BKV | $ | 75.8 | $ | 107.8 | $ | 119.9 | $ | 25.8 | |||||||||||||||
| Adjusted Net Income attributable to BKV, non-GAAP | $ | 50.7 | $ | 24.1 | $ | 73.1 | $ | 61.5 | |||||||||||||||
Adjusted EPS attributable to BKV, non-GAAP(2) | $ | 0.46 | $ | 0.28 | $ | 0.69 | $ | 0.73 | |||||||||||||||
| Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 142.0 | $ | 96.5 | $ | 254.0 | $ | 201.5 | |||||||||||||||
| Net cash provided by operating activities | $ | 109.7 | $ | 89.3 | $ | 181.7 | $ | 105.7 | |||||||||||||||
| Net cash provided by operating activities before working capital, non-GAAP | $ | 117.6 | $ | 84.5 | $ | 226.9 | $ | 134.5 | |||||||||||||||
| Adjusted Free Cash Flow before Power Growth attributable to BKV, non-GAAP | $ | 40.0 | $ | 17.2 | $ | 60.1 | $ | 28.7 | |||||||||||||||
| Capital expenditures (accrued) | |||||||||||||||||||||||
Development (3) | $ | 38.8 | $ | 62.6 | $ | 120.8 | $ | 110.5 | |||||||||||||||
Power (4) | $ | 6.8 | $ | 0.3 | $ | 23.5 | $ | 0.4 | |||||||||||||||
| CCUS and other | $ | 26.8 | $ | 16.1 | $ | 46.7 | $ | 26.2 | |||||||||||||||
| Total capital expenditures (accrued) | $ | 72.4 | $ | 79.0 | $ | 191.0 | $ | 137.1 | |||||||||||||||
Deposits on fixed asset purchases (5) | $ | 125.5 | $ | — | $ | 158.5 | $ | — | |||||||||||||||
(1) Adjusted Net Income attributable to BKV, Adjusted EPS attributable to BKV, Adjusted EBITDAX attributable to BKV, Net cash provided by operating activities before working capital, and Adjusted Free Cash Flow before Power Growth attributable to BKV are each non-GAAP financial measures. For a definition of each of these non-GAAP financial measures and reconciliations of such non-GAAP financial measures to their most directly comparable GAAP metrics, please see “Supplemental Non-GAAP Financial Measures” below.
(2) Reflects Adjusted EPS attributable to BKV on a diluted basis.
(3) Excludes asset retirement obligation expenditures of $0.3 million and $0.5 million for the three months ended June 30, 2026 and 2025, respectively, and $1.0 million and $0.6 million for the six months ended June 30, 2026 and 2025, respectively.
(4) Power maintenance was $0.5 million and $0.3 million for the three months ended June 30, 2026 and 2025, respectively, and $0.8 million and $0.4 million for the six months ended June 30, 2026 and 2025, respectively.
(5) These deposits are comprised of payments for turbines, modular generation equipment, and other long lead time items in Power included within our Strategic Power Growth capital expenditures and investments guidance.
“Our financial strategy is grounded in disciplined capital allocation, a strong balance sheet, and prudent liquidity management,” said David Tameron, Chief Financial Officer of BKV. “During the quarter, we maintained substantial liquidity while continuing to invest in our phased power strategy and expanding our carbon capture platform. Supported by the cash flow generated from our upstream business, we are able to fund these strategic investments while preserving financial flexibility and maintaining a disciplined balance sheet.”
“Our approach to capital deployment remains disciplined and milestone-driven,” continued Tameron. “We will continue to align investment with commercial progress, maintain a prudent leverage profile, and preserve financial flexibility as we execute our growth strategy. This approach allows us to pursue the opportunities we believe will create the greatest long-term value for our shareholders.”
2
Business Segment Results
| Three Months Ended June 30, 2026 | |||||||||||||||||||||||
| ($ Thousands) | Upstream/Midstream | Power | Corporate and Other | Total | |||||||||||||||||||
| Net income (loss) | $ | 116,762 | $ | (6,802) | $ | (32,630) | $ | 77,330 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 44,032 | 9,552 | 504 | 54,088 | |||||||||||||||||||
| Exploration and impairment expense | — | — | — | — | |||||||||||||||||||
| Unrealized (gains) losses on derivatives, net | (56,024) | 10,537 | — | (45,487) | |||||||||||||||||||
Forward month gas settlement (1) | 4,522 | — | — | 4,522 | |||||||||||||||||||
| Interest expense, net | 14,575 | 9,182 | (1,074) | 22,683 | |||||||||||||||||||
| Interest expense, related parties | — | 3,978 | — | 3,978 | |||||||||||||||||||
| Equity-based compensation expense | 3,456 | 1,158 | 1,785 | 6,399 | |||||||||||||||||||
| Impairment of asset held for sale | — | — | 3,516 | 3,516 | |||||||||||||||||||
| Income tax expense | — | — | 20,150 | 20,150 | |||||||||||||||||||
| Other nonrecurring transactions | 559 | 4,331 | — | 4,890 | |||||||||||||||||||
| Adjusted EBITDAX, non-GAAP | 127,882 | 31,936 | (7,749) | 152,069 | |||||||||||||||||||
(Deduct) add: Adjusted EBITDAX attributable to Noncontrolling Interests (2) | — | (9,083) | (990) | (10,073) | |||||||||||||||||||
Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 127,882 | $ | 22,853 | $ | (8,739) | $ | 141,996 | |||||||||||||||
| Three Months Ended June 30, 2025 | |||||||||||||||||||||||
| ($ Thousands) | Upstream/Midstream | Power | Corporate and Other | Total | |||||||||||||||||||
| Net income (loss) | $ | 144,938 | $ | 14,948 | $ | (47,411) | $ | 112,475 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 37,738 | 9,536 | 400 | 47,674 | |||||||||||||||||||
| Exploration and impairment expense | — | — | — | — | |||||||||||||||||||
| Unrealized (gains) losses on derivatives, net | (102,935) | (8,182) | — | (111,117) | |||||||||||||||||||
Forward month gas settlement (1) | (7,216) | — | — | (7,216) | |||||||||||||||||||
| Interest expense, net | 5,441 | 10,351 | (145) | 15,647 | |||||||||||||||||||
| Interest expense, related parties | — | 5,023 | — | 5,023 | |||||||||||||||||||
| Equity-based compensation expense | — | — | 4,069 | 4,069 | |||||||||||||||||||
| Income tax expense | — | — | 29,243 | 29,243 | |||||||||||||||||||
| Other nonrecurring transactions | 3,065 | — | 6,665 | 9,730 | |||||||||||||||||||
Adjusted EBITDAX, non-GAAP | 81,031 | 31,676 | (7,179) | 105,528 | |||||||||||||||||||
(Deduct) add: Adjusted EBITDAX attributable to Noncontrolling Interests (2) | — | (8,726) | (305) | (9,031) | |||||||||||||||||||
Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 81,031 | $ | 22,950 | $ | (7,484) | $ | 96,497 | |||||||||||||||
3
| Six Months Ended June 30, 2026 | |||||||||||||||||||||||
| ($ Thousands) | Upstream/Midstream | Power | Corporate and Other | Total | |||||||||||||||||||
| Net income (loss) | $ | 170,548 | $ | 13,453 | $ | (54,827) | $ | 129,174 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 85,947 | 21,356 | 950 | 108,253 | |||||||||||||||||||
| Exploration and impairment expense | — | — | — | — | |||||||||||||||||||
| Unrealized (gains) losses on derivatives, net | (39,888) | (19,455) | — | (59,343) | |||||||||||||||||||
Forward month gas settlement (1) | (18,923) | — | — | (18,923) | |||||||||||||||||||
| Interest expense, net | 27,117 | 18,452 | (1,554) | 44,015 | |||||||||||||||||||
| Interest expense, related parties | — | 8,247 | — | 8,247 | |||||||||||||||||||
| Equity-based compensation expense | 5,431 | 1,762 | 3,113 | 10,306 | |||||||||||||||||||
| Impairment of asset held for sale | — | — | 3,516 | 3,516 | |||||||||||||||||||
| Income tax expense | — | — | 31,619 | 31,619 | |||||||||||||||||||
| Other nonrecurring transactions | 5,942 | 8,038 | — | 13,980 | |||||||||||||||||||
| Adjusted EBITDAX, non-GAAP | 236,174 | 51,853 | (17,183) | 270,844 | |||||||||||||||||||
(Deduct) add: Adjusted EBITDAX attributable to Noncontrolling Interests (2) | — | (14,960) | (1,850) | (16,810) | |||||||||||||||||||
Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 236,174 | $ | 36,893 | $ | (19,033) | $ | 254,034 | |||||||||||||||
| Six Months Ended June 30, 2025 | |||||||||||||||||||||||
| ($ Thousands) | Upstream/Midstream | Power | Corporate and Other | Total | |||||||||||||||||||
| Net income (loss) | $ | 59,758 | $ | (6,481) | $ | (27,573) | $ | 25,704 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 77,322 | 19,184 | 879 | 97,385 | |||||||||||||||||||
| Exploration and impairment expense | — | — | — | — | |||||||||||||||||||
| Unrealized (gains) losses on derivatives, net | 31,050 | 4,868 | — | 35,918 | |||||||||||||||||||
Forward month gas settlement (1) | (3,219) | — | — | (3,219) | |||||||||||||||||||
| Interest expense, net | 10,468 | 20,748 | (269) | 30,947 | |||||||||||||||||||
| Interest expense, related parties | — | 10,099 | — | 10,099 | |||||||||||||||||||
| Equity-based compensation expense | 2,921 | 1,062 | 2,153 | 6,136 | |||||||||||||||||||
| Impairment of asset held for sale | 2,446 | — | — | 2,446 | |||||||||||||||||||
| Income tax benefit | — | — | (1,425) | (1,425) | |||||||||||||||||||
| Other nonrecurring transactions | 4,165 | — | 7,120 | 11,285 | |||||||||||||||||||
Adjusted EBITDAX, non-GAAP | 184,911 | 49,480 | (19,115) | 215,276 | |||||||||||||||||||
(Deduct) add: Adjusted EBITDAX attributable to Noncontrolling Interests (2) | — | (13,472) | (305) | (13,777) | |||||||||||||||||||
Adjusted EBITDAX attributable to BKV, non-GAAP | $ | 184,911 | $ | 36,008 | $ | (19,420) | $ | 201,499 | |||||||||||||||
________________________________________________________
(1) Natural gas derivative contracts settle and are realized in the month prior to the production covered by the contract. This adjustment removes the timing difference between the settlement date and the underlying production month that is hedged.
(2) Non-GAAP financial measure, see supplemental non-GAAP financial measures for reconciliations to the most comparable financial measures in accordance with GAAP.
4
Segment Operational Results - Second Quarter 2026
Power Segment
BKV continues to make meaningful progress toward securing a long-term power purchase agreement ("PPA") for a portion of the capacity of its existing Temple I and II combined-cycle facilities. Through the previously disclosed advisor-led process, the Company remains engaged in commercial discussions with a select group of prospective counterparties as it advances opportunities to establish long-term contracted cash flows to enhance revenue visibility and optimize generation from its existing generation assets. During the quarter, BKV secured additional acreage adjacent to the Temple Energy Complex, expanding its site control to approximately 1,100 acres. The Company also received Phase 1 air permits for its planned modular generation, representing another key milestone in advancing the phased development of the Temple Energy Complex.
BKV continued advancing development of its planned North Texas Energy Complex in Jack County. With approximately 6,200 acres under site control and generation and load applications submitted, the project represents an opportunity to replicate the Company's closed-loop strategy by combining natural gas production, power generation, and carbon capture capabilities to serve growing power demand in ERCOT.
The Company's operated power generation assets currently consist of Temple I and Temple II, with a combined generation capacity of approximately 1.5 GW. BKV has also entered into equipment supply agreements for approximately 200 MW of modular generation and secured turbine reservations supporting up to 1.2 GW of future combined-cycle generation. If developed as planned, these projects would increase the Company's operated generation capacity to approximately 3 GW. Development remains subject to, among other things, execution of long-term power purchase agreements, financing, regulatory approvals, and commercial negotiations with counterparties. The timing, sequencing, scale, and ultimate composition of these projects may differ materially from those presented, and there can be no assurance that any specific project or generation capacity will be achieved.
The second quarter of 2026 was characterized by strong power demand across ERCOT, which supported higher than expected dispatch at the Temple plants. Total power generation increased ~16% year over year, with the plants operating reliably throughout the quarter and experiencing no forced outages. Wholesale power prices, however, were below expectations, partially offsetting the higher generation.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Temple I capacity factor | 69.2 | % | 64.0 | % | 66.9 | % | 54.7 | % | |||||||||||||||
| Temple II capacity factor | 69.9 | % | 54.8 | % | 65.1 | % | 54.5 | % | |||||||||||||||
| Total power generation (GWh) | 2,222 | 1,913 | 4,203 | 3,500 | |||||||||||||||||||
| Average power price ($/MWh) | $ | 41.59 | $ | 45.10 | $ | 46.04 | $ | 48.63 | |||||||||||||||
| Average natural gas cost | $ | 2.68 | $ | 2.93 | $ | 3.33 | $ | 3.47 | |||||||||||||||
| Average spark spread | $ | 22.31 | $ | 24.27 | $ | 22.26 | $ | 24.00 | |||||||||||||||
| Summary of Power Operations | |||||||||||||||||||||||
| ($ Millions) | |||||||||||||||||||||||
| Total revenues, net | $ | 122.3 | $ | 136.7 | $ | 286.9 | $ | 234.4 | |||||||||||||||
| Depreciation and amortization | $ | 9.5 | $ | 9.5 | $ | 21.4 | $ | 19.2 | |||||||||||||||
| Operating expenses | $ | 107.0 | $ | 97.5 | $ | 226.8 | $ | 194.2 | |||||||||||||||
| Income from operations | $ | 5.8 | $ | 29.7 | $ | 38.7 | $ | 21.0 | |||||||||||||||
| Interest expense, net | $ | (13.2) | $ | (15.4) | $ | (26.7) | $ | (30.8) | |||||||||||||||
| Other income | $ | 0.6 | $ | 0.6 | $ | 1.4 | $ | 3.3 | |||||||||||||||
| Net income (loss) | $ | (6.8) | $ | 14.9 | $ | 13.4 | $ | (6.5) | |||||||||||||||
| Net income (loss) attributable to BKV | $ | (7.6) | $ | 10.4 | $ | 5.6 | $ | (6.2) | |||||||||||||||
Upstream/Midstream Segment
5
BKV delivered another quarter of strong operational performance, with production exceeding the high end of its guidance range while development capital expenditures remained below the midpoint of guidance. The upstream business continues to generate strong cash flow while improvements in capital efficiency support disciplined investment across the Company's broader platform.
Operational results benefited from improvements in drilling and completions execution, including the success of advanced completion designs and positive offset well effects in the Barnett, where modern completion techniques are increasing production from both new and existing wells. Together with continued application of data and analytics to optimize base production, these initiatives are driving capital-efficient production growth and further enhancing BKV's industry-leading low base decline.
During the quarter, the Company also drilled and completed an Upper Barnett well that exceeded expectations. These results significantly de-risk ~50% of Upper Barnett development locations and reduce the expected breakeven price from $3.75/MMBtu to $3.25/MMBtu, further enhancing the quality and returns of its development inventory.
During the second quarter, the Company completed the transition to internally market all of its natural gas production. This provides greater commercial flexibility and is expected to improve margins over time while enhancing BKV's ability to deliver energy solutions across natural gas, power, carbon sequestered gas, and LNG-related arrangements.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Production | |||||||||||||||||||||||
| Net production per day (MMcfe/d) | 978.3 | 811.0 | 951.8 | 786.2 | |||||||||||||||||||
| Natural gas (MMcf) | 72,785 | 58,328 | 140,863 | 112,451 | |||||||||||||||||||
| NGL (MBbls) | 2,650 | 2,535 | 5,139 | 4,877 | |||||||||||||||||||
| Oil (MBbls) | 56 | 44 | 96 | 97 | |||||||||||||||||||
| Total (MMcfe) | 89,021 | 73,802 | 172,273 | 142,295 | |||||||||||||||||||
Natural Gas ($/Mcf) | |||||||||||||||||||||||
| Average NYMEX Henry Hub price | $ | 2.90 | $ | 3.44 | $ | 3.97 | $ | 3.55 | |||||||||||||||
| Differential | $ | (0.76) | $ | (0.77) | $ | (1.16) | $ | (0.67) | |||||||||||||||
| Average realized prices, excluding derivatives | $ | 2.14 | $ | 2.67 | $ | 2.81 | $ | 2.88 | |||||||||||||||
| Average realized prices, including derivatives | $ | 2.60 | $ | 2.83 | $ | 2.85 | $ | 2.84 | |||||||||||||||
NGLs ($/Bbl) | |||||||||||||||||||||||
| Average realized prices, excluding derivatives | $ | 23.00 | $ | 16.42 | $ | 20.57 | $ | 17.70 | |||||||||||||||
| Average realized prices, including derivatives | $ | 25.21 | $ | 16.41 | $ | 22.17 | $ | 16.64 | |||||||||||||||
Oil ($/Bbl) | |||||||||||||||||||||||
| Average realized prices | $ | 86.91 | $ | 57.66 | $ | 79.49 | $ | 61.82 | |||||||||||||||
| Average Operating Cash Costs per Mcfe | |||||||||||||||||||||||
| Lease operating and workover | $ | 0.50 | $ | 0.46 | $ | 0.52 | $ | 0.49 | |||||||||||||||
| Taxes other than income | $ | 0.13 | $ | 0.18 | $ | 0.16 | $ | 0.17 | |||||||||||||||
| Gathering and transportation costs | $ | 0.76 | $ | 0.85 | $ | 0.79 | $ | 0.84 | |||||||||||||||
Total | $ | 1.39 | $ | 1.49 | $ | 1.47 | $ | 1.50 | |||||||||||||||
Carbon Capture Utilization and Sequestration (“CCUS”)
BKV successfully commenced commercial operations at its Cotton Cove and Eagle Ford CCUS projects during the second quarter of 2026 as planned. The Eagle Ford project is expected to sequester approximately 90,000 metric tons of CO₂ per year, while the Cotton Cove project is expected to sequester approximately 32,000 metric tons of CO₂ per year.
The Barnett Zero project sequestered approximately 28,300 and 64,200 metric tons of CO2 during the three and six months ended June 30, 2026, respectively, bringing total sequestered volumes since initial injection in 2023 to approximately 375,800 metric tons of CO2.
Development activities continued across the Company's broader CCUS portfolio during the quarter. BKV successfully drilled the injection well for its East Texas project and a test well at its High West project, further advancing development of these projects.
6
Liquidity and Debt
As of June 30, 2026, BKV had cash and cash equivalents of $152.2 million and restricted cash of $16.1 million related to the Power segment Temple Term Loan Facility. Total debt as of June 30, 2026 was $1.3 billion, which was made up of the 2030 Senior Notes of $500.0 million, RBL balance of $100.0 million, a promissory note of $46.0 million, and Power segment debt of $618.0 million. Power segment debt included $176.0 million of borrowings under the Temple I Loan Agreements, $382.0 million of borrowings under the Temple Term Loan Facility, and a Temple Revolving Facility balance of $60.0 million.
As of June 30, 2026, total liquidity for BKV was $836.7 million, which consisted of $152.2 million in cash and cash equivalents and $684.5 million available capacity under the Company’s RBL. RBL availability as of June 30, 2026, was based on the elected commitment amount of $800.0 million, less an outstanding balance of $100.0 million and $15.5 million of letters of credit.
Third Quarter and Full Year 2026 Guidance
| Q3 2026 | FY 2026 | ||||||||||
| Accrued Capital Expenditures and Net Production ($ Millions) | |||||||||||
Development (1) | $55 - $75 | $200 - $280 | |||||||||
Power - Strategic Capital & Investments + Maintenance (1), (2) | $125 - $175 | $400 - $475 | |||||||||
CCUS and other (2) | $20 - $35 | $90 - $120 | |||||||||
| Total capital expenditures | $200 - $285 | $690 - $875 | |||||||||
Net production (MMcfe/d) | 935 - 965 | 940 - 960 | |||||||||
| Per Unit Operating Costs ($/Mcfe) | |||||||||||
| Lease operating and workover | $0.49 - $0.53 | $0.49 - $0.53 | |||||||||
| Gathering, compression, processing, and transport (GCPT) | $0.80 - $0.84 | $0.80 - $0.84 | |||||||||
| Upstream general and administrative (excl. stock comp) | $0.20 - $0.25 | $0.20 - $0.25 | |||||||||
| Other General and Administrative Costs | |||||||||||
| General and administrative (Power, CCUS, & Other) | $14 - $16 | $53 - $63 | |||||||||
| General and administrative (stock comp) | $4 - $6 | $15 - $25 | |||||||||
| Commodity Prices | |||||||||||
Average natural gas differential (3), (4) | $(0.70) - $(0.80) | $(0.90) - $(1.00) | |||||||||
| NGL % of WTI | ~ 27% | ~ 26% | |||||||||
| Power ($ Millions) | |||||||||||
| Power Adjusted EBITDAX | $45 - $65 | $135 - $175 | |||||||||
____________________________________________
(1) 2026 maintenance capital: Upstream ~$200 million; Power ~$5 million
(2) Expecting $120 million - $150 million in JV partner capital contributions
(3) Differential includes $0.15/Mcfe - $0.20/Mcfe of gathering, compression, processing, and transport
(4) Differential includes $0.15/Mcfe - $0.25/Mcfe of ethane rejection impacts
7
Second Quarter 2026 Earnings Conference Call
The Company plans to host a conference call to discuss results today, August 6, 2026 at 10 AM ET. To access the conference call, participants may dial (800) 420-1459 (US) or (203) 518-9861 (international). Participants can also listen to a live webcast of the call by going to the Investors section on the BKV website at www.ir.bkv.com. A replay will be available shortly after the live conference call and can be accessed on the Company’s website or by dialing (844) 512-2921 (US) or (412) 317-6671 (international). The passcode for the replay is 11162101. The replay will be available for 60 days after the call.
About BKV Corporation
Headquartered in Denver, Colorado, BKV Corporation is a forward-thinking, growth-driven energy company focused on creating value for its stockholders. BKV's core business is to produce natural gas from its owned and operated upstream assets. BKV’s overall business is organized into four business lines: natural gas production; natural gas gathering, processing and transportation; power generation; and carbon capture, utilization and sequestration. BKV (and its predecessor entity) was founded in 2015, and BKV and its employees are committed to building a different kind of energy company. BKV is one of the top 15 gas-weighted natural gas producers in the United States and the largest natural gas producer by gross operated volume in the Barnett Shale. BKV Corporation is the parent company for the BKV family of companies. For more information, visit the BKV website at www.bkv.com.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements, which are not historical facts, include statements regarding BKV’s strategy, future operations, financial position, estimated revenue and losses, projected costs, prospects, plans, objectives of management and dividend policy, and often contain words such as “expect,” “project,” “estimate,” “believe,” “anticipate,” “intend,” “budget,” “plan,” “seek,” “aspire,” “envision,” “forecast,” “target,” “predict,” “may,” “should,” “would,” “could,” “will,” and similar expressions. Actual results and future events could differ materially from those anticipated in such statements, and such forward-looking statements may not prove to be accurate. Such forward-looking statements include, but are not limited to, statements about the anticipated benefits, opportunities and results with respect to the BKV-BPP Power Joint Venture Transaction, including any expected value creation from the BKV-BPP Power Joint Venture Transaction, anticipated efficiencies, power plant reliability, and strategic growth and power purchase agreement opportunities relating to the BKV-BPP Power Joint Venture and the BKV-BPP Power Joint Venture Transaction, as well as guidance, projected or forecasted financial and operating results, future liquidity, leverage, results in certain basins, objectives, project timing, utility of reporting segment changes, expectations and intentions, regulatory and governmental actions and other statements that are not historical facts. All forward-looking statements, expressed or implied, in this press release are based only on information currently available to BKV and speak only as of the date on which they are made. Forward-looking statements are not guarantees of future performance, and BKV cannot assure any reader that those statements will be realized or that the forward-looking events and circumstances will occur. Undue reliance should not be placed on any forward-looking statement, which is based on predictions of future results that may not occur as anticipated. Forward-looking statements are based on management’s current views and assumptions and involve risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations, including but not limited to assumptions, risks and uncertainties regarding the BKV-BPP Power Joint Venture Transaction and the anticipated benefits thereof, as well as our ability to effectively operate and grow our CCUS business, expected increase in demand for power generation and our ability to serve that demand from our power business, our ability to develop, market and sell our carbon sequestered gas product, and management's outlook guidance or forecasts of future events, including projected capital expenditures, production volumes, operating costs, pricing differentials, and Adjusted EBITDAX. For further discussions of risks and uncertainties applicable to forward-looking statements, you should refer to BKV’s filings with the Securities and Exchange Commission (the “SEC”), including the “Risk Factors” section of BKV’s most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q.
Investor Contacts:
Michael Hall
BKV Corporation
Vice President, Investor Relations
InvestorRelations@bkvcorp.com
Patrick Freeman
BKV Corporation
Senior Director, Investor Relations
InvestorRelations@bkvcorp.com
8
BKV Corporation
Condensed Consolidated Balance Sheets
($ thousands, except par value)
($ thousands, except par value)
(Unaudited)
| June 30, 2026 | December 31, 2025 (1) | ||||||||||
| Assets | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 152,192 | $ | 248,427 | |||||||
| Restricted cash | 16,067 | 15,846 | |||||||||
| Accounts receivable, net | 141,125 | 129,077 | |||||||||
| Accounts receivable, related parties | 10,328 | 11,196 | |||||||||
| Prepaid expenses | 10,030 | 14,720 | |||||||||
| Inventory | 17,967 | 20,039 | |||||||||
| Commodity derivative assets, current | 99,388 | 63,900 | |||||||||
| Other current assets | 10,736 | 8,150 | |||||||||
| Total current assets | 457,833 | 511,355 | |||||||||
| Natural gas properties and equipment | |||||||||||
| Developed properties | 3,057,987 | 2,965,638 | |||||||||
| Undeveloped properties | 13,361 | 13,182 | |||||||||
| Midstream assets | 279,554 | 277,974 | |||||||||
| Accumulated depreciation, depletion, and amortization | (922,083) | (849,464) | |||||||||
| Total natural gas properties, net | 2,428,819 | 2,407,330 | |||||||||
| Other property, plant, and equipment, net | 1,096,116 | 944,412 | |||||||||
| Deposits | 171,867 | 14,247 | |||||||||
| Goodwill | 18,417 | 18,417 | |||||||||
| Commodity derivative assets | 45,749 | 26,432 | |||||||||
| Other noncurrent assets | 16,379 | 17,064 | |||||||||
| Total assets | $ | 4,235,180 | $ | 3,939,257 | |||||||
| Liabilities, mezzanine equity, and equity | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable and accrued liabilities | $ | 194,823 | $ | 229,487 | |||||||
| Commodity derivative liabilities, current | 9,698 | 8,469 | |||||||||
| Income taxes payable to related party | — | 810 | |||||||||
| Payable to BPPUS for the BKV-BPP Power Joint Venture Transaction | — | 115,136 | |||||||||
| Current portion of Temple I Loan Agreements | 176,000 | 191,000 | |||||||||
| Current portion of long-term debt, net | 9,387 | 9,387 | |||||||||
| Other current liabilities | 8,797 | 10,302 | |||||||||
| Total current liabilities | 398,705 | 564,591 | |||||||||
| Asset retirement obligations | 200,604 | 230,372 | |||||||||
| Commodity derivative liabilities | — | 5,767 | |||||||||
| Deferred tax liability, net | 160,290 | 128,839 | |||||||||
| Long-term debt, net | 1,064,454 | 937,724 | |||||||||
| Other noncurrent liabilities | 7,857 | 5,223 | |||||||||
| Total liabilities | 1,831,910 | 1,872,516 | |||||||||
| Commitments and contingencies | |||||||||||
| Mezzanine equity | |||||||||||
| Noncontrolling interest | 30,224 | 12,951 | |||||||||
9
| Stockholders' equity | |||||||||||
Common stock, $0.01 par value; 500,000 authorized shares; 109,417 and 96,872 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively | 1,760 | 1,635 | |||||||||
Treasury stock, shares at cost; 214 shares as of June 30, 2026 and December 31, 2025 | (6,663) | (6,663) | |||||||||
| Additional paid-in capital | 1,875,615 | 1,681,785 | |||||||||
| Retained earnings | 426,391 | 309,051 | |||||||||
| Total stockholders' equity | 2,297,103 | 1,985,808 | |||||||||
| Noncontrolling interest | 75,943 | 67,982 | |||||||||
| Total equity | 2,373,046 | 2,053,790 | |||||||||
| Total liabilities, mezzanine equity, and equity | $ | 4,235,180 | $ | 3,939,257 | |||||||
_________________________________________________
(1) The financial information presented in the condensed consolidated financial statements has been retrospectively adjusted for the BKV-BPP Power Joint Venture Transaction, which was accounted for as a transaction between entities under common control, with prior periods recast as if the transaction had occurred at the beginning of the earliest period presented. For additional information, see Note 2 - Acquisition to our condensed consolidated financial statements included in our Quarterly Report on Form 10-Q for the period ended June 30, 2026.
10
BKV Corporation
Condensed Consolidated Statements of Income
($ thousands, except per share amounts)
($ thousands, except per share amounts)
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 (1) | |||||||||||||||||||||||
| Revenues and other operating income | ||||||||||||||||||||||||||
| Natural gas, NGL, and oil sales | $ | 221,928 | $ | 199,729 | $ | 509,603 | $ | 415,855 | ||||||||||||||||||
| Power revenues | 74,362 | 61,924 | 143,352 | 105,788 | ||||||||||||||||||||||
| Derivative gains, net | 143,255 | 187,026 | 196,364 | 88,643 | ||||||||||||||||||||||
| Marketing revenues | 26,162 | 6,968 | 46,043 | 19,425 | ||||||||||||||||||||||
| Section 45Q tax credits | 3,048 | 2,574 | 6,108 | 5,881 | ||||||||||||||||||||||
| Other | (3,220) | 140 | (3,088) | (1,165) | ||||||||||||||||||||||
| Total revenues and other operating income | 465,535 | 458,361 | 898,382 | 634,427 | ||||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||||||||
| Lease operating and workover | 44,482 | 34,176 | 89,557 | 69,231 | ||||||||||||||||||||||
| Fuel commodity costs | 42,832 | 39,852 | 99,953 | 86,215 | ||||||||||||||||||||||
| Purchased power | 29,502 | 29,494 | 56,857 | 48,161 | ||||||||||||||||||||||
| Marketing expense | 23,262 | 4,868 | 29,310 | 8,788 | ||||||||||||||||||||||
| Taxes other than income | 15,900 | 18,042 | 36,102 | 32,832 | ||||||||||||||||||||||
| Gathering and transportation | 68,095 | 63,026 | 135,897 | 118,819 | ||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 52,877 | 47,580 | 105,818 | 97,177 | ||||||||||||||||||||||
| Power operating and maintenance | 17,185 | 18,252 | 36,864 | 38,465 | ||||||||||||||||||||||
| General and administrative | 42,125 | 30,479 | 82,236 | 58,778 | ||||||||||||||||||||||
Other operating expenses | 7,619 | 11,244 | 18,106 | 14,710 | ||||||||||||||||||||||
| Total operating expenses | 343,879 | 297,013 | 690,700 | 573,176 | ||||||||||||||||||||||
| Income from operations | 121,656 | 161,348 | 207,682 | 61,251 | ||||||||||||||||||||||
| Other income (expense) | ||||||||||||||||||||||||||
| Interest expense | (24,881) | (16,384) | (47,711) | (32,433) | ||||||||||||||||||||||
| Interest expense, related parties | (3,978) | (5,023) | (8,247) | (10,099) | ||||||||||||||||||||||
| Interest income | 2,198 | 737 | 3,696 | 1,486 | ||||||||||||||||||||||
| Other income | 2,485 | 1,040 | 5,373 | 4,074 | ||||||||||||||||||||||
| Income before income taxes | 97,480 | 141,718 | 160,793 | 24,279 | ||||||||||||||||||||||
| Income tax benefit (expense) | (20,150) | (29,243) | (31,619) | 1,425 | ||||||||||||||||||||||
| Net income | 77,330 | 112,475 | 129,174 | 25,704 | ||||||||||||||||||||||
| Less: net income (loss) attributable to noncontrolling interest | 1,524 | 4,707 | 9,293 | (85) | ||||||||||||||||||||||
| Net income attributable to BKV | $ | 75,806 | $ | 107,768 | $ | 119,881 | $ | 25,789 | ||||||||||||||||||
| Net income per common share attributable to BKV: | ||||||||||||||||||||||||||
| Basic | $ | 0.68 | $ | 1.27 | $ | 1.11 | $ | 0.30 | ||||||||||||||||||
| Diluted | $ | 0.67 | $ | 1.27 | $ | 1.11 | $ | 0.30 | ||||||||||||||||||
| Weighted average number of common shares outstanding: | ||||||||||||||||||||||||||
| Basic | 109,395 | 84,710 | 105,727 | 84,708 | ||||||||||||||||||||||
| Diluted | 109,772 | 84,834 | 106,058 | 84,789 | ||||||||||||||||||||||
_________________________________________________
(1) The financial information presented in the condensed consolidated financial statements has been retrospectively adjusted for the BKV-BPP Power Joint Venture Transaction, which was accounted for as a transaction between entities under common control, with prior periods recast as if the transaction had occurred at the beginning of the earliest period presented. For additional information, see Note 2 - Acquisition to our condensed consolidated financial statements included in our Quarterly Report on Form 10-Q for the period ended June 30, 2026.
11
BKV Corporation
Condensed Consolidated Statements of Cash Flows
($ thousands)
($ thousands)
(Unaudited)
| Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025(1) | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net income | $ | 129,174 | $ | 25,704 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
| Depreciation, depletion, amortization, and accretion | 108,253 | 97,385 | ||||||||||||
| Equity-based compensation expense | 10,306 | 6,136 | ||||||||||||
| Deferred income tax expense (benefit) | 31,619 | (2,255) | ||||||||||||
| Unrealized (gains) losses on derivatives, net | (59,343) | 35,918 | ||||||||||||
| Impairment of asset held for sale | 3,516 | 2,446 | ||||||||||||
| Settlement of contingent consideration | — | (20,000) | ||||||||||||
| Payments for the purchase of put options | — | (16,206) | ||||||||||||
| Other, net | 3,348 | 5,390 | ||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||
| Accounts receivable, net | (13,001) | (14,617) | ||||||||||||
| Accounts receivable, related party | 868 | 3,624 | ||||||||||||
| Accounts payable and accrued liabilities | (32,479) | (19,831) | ||||||||||||
| Other changes in operating assets and liabilities | (530) | 2,054 | ||||||||||||
| Net cash provided by operating activities | 181,731 | 105,748 | ||||||||||||
| Cash flows from investing activities: | ||||||||||||||
| Asset acquisition | (118,746) | — | ||||||||||||
| Deposits on fixed asset purchases | (158,507) | (7,500) | ||||||||||||
| Capital expenditures | (193,365) | (124,102) | ||||||||||||
| Proceeds from sales of assets | 473 | 1,258 | ||||||||||||
| Other investing activities, net | 264 | 257 | ||||||||||||
| Net cash used in investing activities | (469,881) | (130,087) | ||||||||||||
| Cash flows from financing activities: | ||||||||||||||
| Proceeds from issuance of common stock, net of underwriting discounts and commissions | 185,504 | — | ||||||||||||
| Acquisition of additional interest in BKV-BPP Power | (115,136) | — | ||||||||||||
| Payment of debt issuance costs | (892) | (720) | ||||||||||||
Payments on Temple Term Loan Facility | (19,885) | (5,000) | ||||||||||||
| Proceeds from Promissory Note | 46,000 | — | ||||||||||||
| Payments on Temple I Loan Agreements | (15,000) | — | ||||||||||||
| Proceeds under RBL Credit Agreement | 570,000 | 355,000 | ||||||||||||
| Payments on RBL Credit Agreement | (470,000) | (320,000) | ||||||||||||
| Net share settlements, equity-based compensation | (2,132) | (1,204) | ||||||||||||
| Cash contributions from noncontrolling interest | 13,400 | 4,353 | ||||||||||||
| Common stock issued from employee purchase plan | 277 | — | ||||||||||||
| Net cash provided by financing activities | 192,136 | 32,429 | ||||||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | (96,014) | 8,090 | ||||||||||||
| Cash, cash equivalents, and restricted cash, beginning of period | 264,273 | 96,998 | ||||||||||||
Cash, cash equivalents, and restricted cash, end of period | $ | 168,259 | $ | 105,088 | ||||||||||
_________________________________________________
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(1) The financial information presented in the condensed consolidated financial statements has been retrospectively adjusted for the BKV-BPP Power Joint Venture Transaction, which was accounted for as a transaction between entities under common control, with prior periods recast as if the transaction had occurred at the beginning of the earliest period presented. For additional information, see Note 2 - Acquisition to our condensed consolidated financial statements included in our Quarterly Report on Form 10-Q for the period ended June 30, 2026.
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Derivative Contract Volumes and Fair Values
The following tables summarize the Company’s outstanding derivative positions as of June 30, 2026 by commodity and contract type, including volume, pricing indices, or reference points, and associated fair values.
The following table summarizes the Company's power derivatives:
| Instrument | Units | Quantity | Pricing Index | Fair Value as of June 30, 2026 ($ thousands) | ||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Swap | MMBtu | 3,066,000 | HSC Gas Daily | $ | (2,752) | |||||||||||||||||||||
| Power forwards - sales | MWh | 438,000 | ERCOT North | $ | 5,959 | |||||||||||||||||||||
| Heat rate call option | MMBtu | 2,628,000 | Various | $ | 13,891 | |||||||||||||||||||||
| Power forwards - purchases | MWh | 344,030 | Various | $ | (6,145) | |||||||||||||||||||||
| 2027 | ||||||||||||||||||||||||||
| Swap | MMBtu | 12,264,000 | HSC Gas Daily | $ | 507 | |||||||||||||||||||||
| Power forwards - sales | MWh | 1,752,000 | ERCOT North | $ | 2,378 | |||||||||||||||||||||
| Power forwards - purchases | MWh | 87,600 | Various | $ | (735) | |||||||||||||||||||||
The following table represents natural gas commodity derivatives indexed to NYMEX Henry Hub pricing:
| Instrument | MMBtu | Weighted Average Price (USD) | Weighted Average Price Floor | Weighted Average Price Ceiling | Fair Value as of June 30, 2026 ($ thousands) | |||||||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||||||||
| Swap | 75,768,006 | $ | 3.88 | $ | 34,725 | |||||||||||||||||||||||||||
| 2027 | ||||||||||||||||||||||||||||||||
| Swap | 98,958,854 | $ | 3.99 | $ | 49,421 | |||||||||||||||||||||||||||
| Collars | 37,662,319 | $ | 3.57 | $ | 4.00 | $ | 9,378 | |||||||||||||||||||||||||
| Call options | 36,500,000 | $ | 5.00 | $ | (6,038) | |||||||||||||||||||||||||||
| Put options | 36,500,000 | $ | 3.00 | $ | 10,398 | |||||||||||||||||||||||||||
| 2028 | ||||||||||||||||||||||||||||||||
| Swap | 94,085,323 | $ | 3.79 | $ | 12,469 | |||||||||||||||||||||||||||
| 2029 | ||||||||||||||||||||||||||||||||
| Swap | 35,587,500 | $ | 3.60 | $ | (29) | |||||||||||||||||||||||||||
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The following table represents natural gas basis derivatives by reference price listed below:
| Instrument | Basis Reference Price | MMBtu | Weighted Average Basis Differential | Fair Value as of June 30, 2026 ($ thousands) | ||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Swap | Transco Leidy Basis | 25,526,433 | $ | (0.79) | $ | 132 | ||||||||||||||||||||
| Swap | HSC Basis | 27,600,000 | $ | (0.32) | $ | 5,796 | ||||||||||||||||||||
| Swap | Transco St 85 (Z4) Basis | 18,400,000 | $ | 0.62 | $ | (2,384) | ||||||||||||||||||||
| Swap | NGPL TXOK Basis | 23,943,741 | $ | (0.40) | $ | 2,463 | ||||||||||||||||||||
| 2027 | ||||||||||||||||||||||||||
| Swap | Transco Leidy Basis | 10,950,000 | $ | (0.76) | $ | (1,308) | ||||||||||||||||||||
| Swap | HSC Basis | 7,300,000 | $ | (0.25) | $ | 1,194 | ||||||||||||||||||||
| Swap | NGPL TXOK Basis | 16,965,270 | $ | (0.31) | $ | 1,593 | ||||||||||||||||||||
| 2028 | ||||||||||||||||||||||||||
| Swap | Transco Leidy Basis | 7,320,000 | $ | (0.76) | $ | (693) | ||||||||||||||||||||
| Swap | HSC Basis | 10,980,000 | $ | (0.17) | $ | 1,229 | ||||||||||||||||||||
The following table summarizes the Company's natural gas liquids derivatives position by product and reference price:
| Instrument | Commodity Reference Price | Gallons | Weighted Average Price (USD) | Fair Value as of June 30, 2026 ($ thousands) | ||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Swap | OPIS Purity Ethane Mont Belvieu | 68,220,796 | $ | 0.25 | $ | 591 | ||||||||||||||||||||
| Swap | OPIS IsoButane Mont Belvieu Non-TET | 7,128,934 | $ | 0.86 | $ | (497) | ||||||||||||||||||||
| Swap | OPIS Normal Butane Mont Belvieu Non-TET | 11,719,147 | $ | 0.83 | $ | (938) | ||||||||||||||||||||
| Swap | OPIS Propane Mont Belvieu Non-TET | 40,975,148 | $ | 0.70 | $ | (586) | ||||||||||||||||||||
| Swap | OPIS Natural Gasoline Mont Belvieu Non-TET | 18,268,618 | $ | 1.39 | $ | (1,563) | ||||||||||||||||||||
| 2027 | ||||||||||||||||||||||||||
| Swap | OPIS Purity Ethane Mont Belvieu | 79,965,970 | $ | 0.28 | $ | 3,841 | ||||||||||||||||||||
| Swap | OPIS IsoButane Mont Belvieu Non-TET | 13,846,327 | $ | 0.87 | $ | 324 | ||||||||||||||||||||
| Swap | OPIS Normal Butane Mont Belvieu Non-TET | 20,203,274 | $ | 0.83 | $ | 246 | ||||||||||||||||||||
| Swap | OPIS Propane Mont Belvieu Non-TET | 76,415,634 | $ | 0.70 | $ | 1,412 | ||||||||||||||||||||
| Swap | OPIS Natural Gasoline Mont Belvieu Non-TET | 34,754,781 | $ | 1.39 | $ | 1,160 | ||||||||||||||||||||
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Supplemental Non-GAAP Financial Measures
This release includes the non-GAAP financial measures described below. These non-GAAP measures are intended to provide additional information only and should not be considered as alternatives to, or more meaningful than, net income (loss) attributable to BKV, basic and diluted EPS, net income (loss), net cash provided by operating activities, or any other measure calculated in accordance with GAAP.
As a result of the Company’s acquisition of an additional 25% ownership interest in and consolidation of the BKV-BPP Power JV as of January 30, 2026, the Company changed the presentation of its non-GAAP measures of Combined Adjusted EBITDAX, Adjusted Free Cash Flow, and Adjusted Free Cash Flow Margin beginning in the first quarter of 2026. The Company now discloses Adjusted Net Income (Loss) attributable to BKV, Adjusted EPS attributable to BKV, Adjusted EBITDAX, Adjusted EBITDAX attributable to BKV, Adjusted EBITDAX attributable to Noncontrolling Interests, Adjusted Free Cash Flow before Power Growth, and Adjusted Free Cash Flow before Power Growth attributable to BKV. Such non-GAAP measures have been presented in this release for the comparative period and have been calculated based on the definitions below.
Net Leverage Ratio
The Company defines Net Leverage Ratio as total debt less cash and cash equivalents, and restricted cash, divided by Adjusted EBITDAX for the most recent quarter’s annualized Adjusted EBITDAX (the quarter’s Adjusted EBITDAX multiplied by four). The Company uses this metric to evaluate total debt relative to the Company’s ability to generate cash through Adjusted EBITDAX. This metric also provides management with a benchmark of debt levels while considering growth opportunities and the Company’s ability to manage periods of commodity price volatility.
The table below presents a calculation of the Company’s Net Leverage Ratio:
| ($ thousands, except Net Leverage Ratio) | As of June 30, 2026 | |||||||
| Total debt | $ | 1,249,841 | ||||||
| Less: Cash and cash equivalents | $ | 168,259 | ||||||
| Net debt | $ | 1,081,582 | ||||||
Divided by annualized Adjusted EBITDAX (1) | $ | 608,276 | ||||||
| Net Leverage Ratio | 1.78x | |||||||
_______________________________
(1) Adjusted EBITDAX for the three months ended June 30, 2026 multiplied by four.
Adjusted Net Income (Loss) Attributable to BKV and Adjusted EPS Attributable to BKV
The Company defines Adjusted Net Income (Loss) attributable to BKV as net income (loss) attributable to BKV before (i) net unrealized derivative (gains) losses, (ii) forward month gas settlements, (iii) impairment of assets held for sale, (iv) other nonrecurring transactions, and (v) the tax impact of these adjustments calculated using a 23% statutory rate. The Company defines Adjusted EPS attributable to BKV as Adjusted Net Income (Loss) attributable to BKV divided by diluted weighted average common shares outstanding.
The Company believes Adjusted Net Income (Loss) attributable to BKV and Adjusted EPS attributable to BKV are useful performance measures because they allow the Company to effectively evaluate its operating performance and results of operations from period to period and against its peers, without regard to financing methods, corporate form, capital structure, or one-time events. The Company excludes the items listed above from net income (loss) attributable to BKV in arriving at Adjusted Net Income (Loss) attributable to BKV and Adjusted EPS attributable to BKV because these amounts can vary substantially from company to company within the industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired. The Company's presentation of Adjusted Net Income (Loss) attributable to BKV and Adjusted EPS attributable to BKV should not be construed as an inference that its results will be unaffected by unusual or non-recurring items. Other companies, including other companies in the industry, may not use Adjusted Net Income (Loss) attributable to BKV and Adjusted EPS attributable to BKV or may calculate these measures differently than as presented in this release, limiting their usefulness as comparative measures.
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The table below presents a reconciliation of Adjusted Net Income (Loss) attributable to BKV to net income (loss) attributable to BKV, the Company's most directly comparable GAAP financial measure, for the periods indicated.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| ($ Thousands, except EPS) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income attributable to BKV | $ | 75,806 | $ | 107,768 | $ | 119,881 | $ | 25,789 | |||||||||||||||
| Adjustment to net income attributable to BKV: | |||||||||||||||||||||||
| Net unrealized derivative (gains) losses | (45,487) | (111,117) | (59,343) | 35,918 | |||||||||||||||||||
Forward month gas settlement (1) | 4,522 | (7,216) | (18,923) | (3,219) | |||||||||||||||||||
| Impairment of asset held for sale | 3,516 | — | 3,516 | 2,446 | |||||||||||||||||||
| Other nonrecurring transactions | 4,890 | 9,730 | 13,980 | 11,285 | |||||||||||||||||||
| Total adjustments before taxes | (32,559) | (108,603) | (60,770) | 46,430 | |||||||||||||||||||
| Tax effect of adjustments | 7,488 | 24,979 | 13,977 | (10,679) | |||||||||||||||||||
| Total adjustments after taxes | (25,071) | (83,624) | (46,793) | 35,751 | |||||||||||||||||||
| Adjusted Net Income attributable to BKV | $ | 50,735 | $ | 24,144 | $ | 73,088 | $ | 61,540 | |||||||||||||||
| Adjusted EPS attributable to BKV: | |||||||||||||||||||||||
| Basic | $ | 0.46 | $ | 0.29 | $ | 0.69 | $ | 0.73 | |||||||||||||||
| Diluted | $ | 0.46 | $ | 0.28 | $ | 0.69 | $ | 0.73 | |||||||||||||||
| Basic weighted-average shares of common stock outstanding | 109,395 | 84,710 | 105,727 | 84,708 | |||||||||||||||||||
| Add dilutive effects of TRSUs | 187 | 124 | 170 | 81 | |||||||||||||||||||
| Add dilutive effects of PRSUs | 190 | — | 161 | — | |||||||||||||||||||
| Diluted weighted-average shares of common stock outstanding | 109,772 | 84,834 | 106,058 | 84,789 | |||||||||||||||||||
_________________________________________________
(1) Natural gas derivative contracts settle and are realized in the month prior to the production covered by the contract. This adjustment removes the timing difference between the settlement date and the underlying production month that is hedged.
Adjusted EBITDAX, Adjusted EBITDAX Attributable to BKV, and Adjusted EBITDAX Attributable to Noncontrolling Interests
The Company defines Adjusted EBITDAX as net income (loss) before (i) depreciation, depletion, amortization, and accretion, (ii) exploration and impairment expense, (iii) net unrealized gains (losses) on derivatives, (iv) gains (losses) on contingent consideration liabilities, (v) net interest expense, (vi) interest expense, related parties, (vii) equity-based compensation expense, (viii) income tax benefit (expense), and (ix) other nonrecurring transactions. Adjusted EBITDAX attributable to BKV is defined as Adjusted EBITDAX less Adjusted EBITDAX attributable to Noncontrolling Interests.
The Company excludes the items listed above from net income (loss) in arriving at Adjusted EBITDAX because these amounts can vary substantially from company to company within the industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired. Adjusted EBITDAX should not be considered an alternative to, or more meaningful than, net income (loss) determined in accordance with GAAP. Certain items excluded from Adjusted EBITDAX are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax burden, as well as the historic costs of depreciable assets, none of which are reflected in Adjusted EBITDAX. The Company’s presentation of Adjusted EBITDAX should not be construed
17
as an inference that its results will be unaffected by unusual or non-recurring items. Other companies, including other companies in the industry, may not use Adjusted EBITDAX or may calculate this measure differently than as presented in this release, limiting its usefulness as a comparative measure.
Adjusted EBITDAX is a supplemental non-GAAP financial measure that is used by the Company’s management and external users of its consolidated financial statements, such as industry analysts, investors, lenders, rating agencies, and others to more effectively evaluate the Company’s operating performance and results of operations from period to period and against industry peers. The Company believes Adjusted EBITDAX is a useful performance measure because it allows the Company to effectively evaluate its operating performance and results of operations from period to period and against industry peers, without regard to its financing methods, corporate form, or capital structure.
The table below presents a reconciliation of Adjusted EBITDAX to net income, the Company’s most directly comparable GAAP financial measure, for the periods indicated.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| ($ Thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income | $ | 77,330 | $ | 112,475 | $ | 129,174 | $ | 25,704 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Depreciation, depletion, amortization, and accretion | 54,088 | 47,674 | 108,253 | 97,385 | |||||||||||||||||||
| Exploration and impairment expense | — | — | — | — | |||||||||||||||||||
| Unrealized (gains) losses on derivatives, net | (45,487) | (111,117) | (59,343) | 35,918 | |||||||||||||||||||
Forward month gas settlement (1) | 4,522 | (7,216) | (18,923) | (3,219) | |||||||||||||||||||
| Interest expense, net | 22,683 | 15,647 | 44,015 | 30,947 | |||||||||||||||||||
| Interest expense, related parties | 3,978 | 5,023 | 8,247 | 10,099 | |||||||||||||||||||
| Equity-based compensation expense | 6,399 | 4,069 | 10,306 | 6,136 | |||||||||||||||||||
| Impairment of asset held for sale | 3,516 | — | 3,516 | 2,446 | |||||||||||||||||||
| Income tax expense | 20,150 | 29,243 | 31,619 | (1,425) | |||||||||||||||||||
| Other nonrecurring transactions | 4,890 | 9,730 | 13,980 | 11,285 | |||||||||||||||||||
| Adjusted EBITDAX | 152,069 | 105,528 | 270,844 | 215,276 | |||||||||||||||||||
(Deduct) add: Adjusted EBITDAX attributable to Noncontrolling Interests (2) | (10,073) | (9,031) | (16,810) | (13,777) | |||||||||||||||||||
| Adjusted EBITDAX attributable to BKV | $ | 141,996 | $ | 96,497 | $ | 254,034 | $ | 201,499 | |||||||||||||||
_________________________________________
(1) Natural gas derivative contracts settle and are realized in the month prior to the production covered by the contract. This adjustment removes the timing difference between the settlement date and the underlying production month that is hedged.
(2) Non-GAAP financial measure, see below for a reconciliation of this non-GAAP financial measure to the most comparable financial measure in accordance with GAAP.
The Company defines Adjusted EBITDAX attributable to Noncontrolling Interests as the proportionate share of Adjusted EBITDAX attributable to Noncontrolling Interests in the BKV-BPP Power JV, BKV-CIP JV, and BKV-BPP Cotton Cove JV, our non-wholly owned consolidated subsidiaries. The table below reconciles Adjusted EBITDAX attributable to Noncontrolling Interests to net income (loss) attributable to Noncontrolling Interest, the most comparable financial measure in accordance with GAAP.
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| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| ($ Thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income (loss) attributable to noncontrolling interest | $ | 1,524 | $ | 4,707 | $ | 9,293 | $ | (85) | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Interest expense, net | 3,290 | 3,844 | 6,675 | 7,712 | |||||||||||||||||||
| Depreciation and amortization | 2,625 | 2,526 | 5,706 | 4,933 | |||||||||||||||||||
| EBITDAX before adjustments | 7,439 | 11,077 | 21,674 | 12,560 | |||||||||||||||||||
| Net unrealized derivative (gains) losses | 2,634 | (2,046) | (4,864) | 1,217 | |||||||||||||||||||
Adjusted EBITDAX attributable to Noncontrolling Interests | $ | 10,073 | $ | 9,031 | $ | 16,810 | $ | 13,777 | |||||||||||||||
Adjusted Free Cash Flow before Power Growth and Adjusted Free Cash Flow before Power Growth Attributable to BKV
The Company defines Adjusted Free Cash Flow before Power Growth as net cash provided by operating activities, excluding cash paid for contingent consideration and changes in operating assets and liabilities, less total cash paid for capital expenditures (excluding leasehold costs and acquisitions), excluding strategic power growth capital expenditures. Adjusted Free Cash Flow before Power Growth attributable to BKV is defined as Adjusted Free Cash Flow before Power Growth, less Adjusted EBITDAX attributable to noncontrolling interests, with net interest expense attributable to noncontrolling interests added back, plus net contributions from noncontrolling interests.
Adjusted Free Cash Flow before Power Growth and Adjusted Free Cash Flow before Power Growth attributable to BKV are not measures of net cash provided by or used in operating activities as determined in accordance with GAAP. These measures are supplemental non-GAAP financial measures used by management and external users of the Company's financial statements, including industry analysts, investors, lenders and rating agencies, to assess the Company's ability to internally fund its capital program, service or incur additional debt and pay dividends. Adjusted Free Cash Flow before Power Growth reflects cash flow available to fund the Company's capital program, excluding strategic power growth capital expenditures, while Adjusted Free Cash Flow before Power Growth attributable to BKV further adjusts for noncontrolling interests to reflect amounts attributable to the Company's common shareholders. The Company believes these measures are useful indicators of liquidity because they facilitate period-over-period comparisons of cash flow provided by operating activities and the Company's ability to internally fund its capital program (including acquisitions), reduce leverage, fund acquisitions and return capital to shareholders. Adjusted Free Cash Flow before Power Growth and Adjusted Free Cash Flow before Power Growth attributable to BKV should not be considered alternatives to, or more meaningful than, net income (loss) or net cash provided by (used in) operating activities determined in accordance with GAAP. Other companies, including other companies in the industry, may define these measures differently, limiting their usefulness as comparative measures.
The table below presents a reconciliation of Adjusted Free Cash Flow before Power Growth and Adjusted Free Cash Flow before Power Growth attributable to BKV to net cash provided by operating activities, the Company's most directly comparable GAAP financial measure, for the periods indicated.
19
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| ($ Thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net cash provided by operating activities | $ | 109,742 | $ | 89,295 | $ | 181,731 | $ | 105,748 | |||||||||||||||
| Change in operating assets and liabilities | 7,866 | (4,811) | 45,142 | 28,770 | |||||||||||||||||||
| Net cash provided by operating activities before change in working capital | 117,608 | 84,484 | 226,873 | 134,518 | |||||||||||||||||||
Cash paid for contingent consideration (1) | — | — | — | 20,000 | |||||||||||||||||||
| Cash paid for capital expenditures (excl. leasehold costs, acquisitions) | (86,838) | (66,490) | (193,365) | (124,102) | |||||||||||||||||||
| Strategic Power Growth capital expenditures | 6,822 | — | 23,279 | — | |||||||||||||||||||
| Adjusted Free Cash Flow before Power Growth | $ | 37,592 | $ | 17,994 | $ | 56,787 | $ | 30,416 | |||||||||||||||
| Add back (subtract): | |||||||||||||||||||||||
| Adjusted EBITDAX attributable to Noncontrolling Interests | (10,073) | (9,031) | (16,810) | (13,777) | |||||||||||||||||||
| Net interest expense attributable to noncontrolling interests | 3,290 | 3,844 | 6,675 | 7,712 | |||||||||||||||||||
| Net contributions from noncontrolling interests | 9,200 | 4,353 | 13,400 | 4,353 | |||||||||||||||||||
| Adjusted Free Cash Flow before Power Growth attributable to BKV | $ | 40,009 | $ | 17,160 | $ | 60,052 | $ | 28,704 | |||||||||||||||
(1) Cash paid for contingent consideration is included as a deduction to arrive at net cash provided by operating activities and therefore, is added back for the purpose of computing Adjusted Free Cash Flow before Power Growth.
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