How much cash does InPlay 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. InPlay booked 119.9 million boe of proved plus probable reserves at 31 December 2025 (91.0 million boe proved, 48.0 million boe of it already developed and producing) after the Pembina acquisition delivered 1,084 per cent reserve replacement. Against 2026 guidance of 18,900 to 19,400 boe a day (about 7.0 million boe a year) that is roughly a 17 year 2P reserve life and 13 years proved.

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 18,900 to 19,400 boe a day sits 11 per cent above 2025's average, but most of that is simply a full year of the acquired Pembina assets; the underlying plan holds production near flat while paying the dividend, so the growth dial starts at a modest 2 per cent.

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$216M; take off the C$452M cost of cleaning up the wells if that switch is on; divide by 27.65M 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, cash interest paid, lease payments, capital spending, dividends, buybacks and acquisitions for every year from 2016 to 2025 were hand-checked on 1 September 2026 against the audited statements of cash flows on inplayoil.com; every figure matched the filings to the thousand of dollars, and each year's statement was cross-footed against its own subtotals. The 2017 buyback line is the $0.5 million repurchase of common shares in that year's audited statements.
• Share counts are adjusted for the 6-to-1 share consolidation of 14 April 2025: earlier years' reported weighted diluted counts were divided by six so every year is on today's share basis.
• The April 2025 Pembina acquisition from Obsidian Energy (about $309 million: $210.9 million cash at closing, 9.1 million InPlay shares and InPlay's Willesden Green unit interest) doubled the company; 2025 shows $203.4 million of net cash acquisitions and a jump in net debt from $67 to $226 million. History before 2025 describes a much smaller company.
• On 21 August 2026 InPlay closed a further $54.25 million cash acquisition of a private Belly River producer (about 1,400 boe a day), funded with debt after the quarter end, so today's net debt is roughly $270 million rather than the $216 million reported at 30 June 2026.
• Net debt in the history uses the company's own stated net debt for 2016 to 2020 (which nets working capital) and total debt including leases less cash for 2021 to 2025; the two definitions differ by a few million dollars in any year.
• 2016 is a transition year: InPlay went public through the Anderson Energy reverse takeover in November 2016, so that year's cash flow reflects the smaller private predecessor for most of the year (production averaged just 1,940 boe a day).
• The 2018 acquisitions line is a net seller year (about $21.5 million of dispositions); 2021 includes the $29.3 million Prairie Storm corporate acquisition.
• Interest is the audited cash interest paid each year; it tripled to $19.5 million in 2025 with the acquisition debt, which makes the add-back matter far more than it used to.
• The decommissioning obligation of $452.4 million (discounted) is very large against a $478 million market value because the Pembina assets came with thousands of ageing Cardium wells; the clean-up toggle treats it all as a straight deduction, which is conservative but honest about the long-term bill.
• Dividends began in late 2022; 2025's $27.1 million was paid alongside the acquisition, and 2026 guidance plans about $30 million.
• Analyst targets: average C$25.00 across 6 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.