Hello. I'm Tony Marino, President and CEO of Tenaz Energy. Thank you for joining us for this discussion of our Q1 2025 results. We first ask you to note our advisory on forward-looking statements. I'm going to begin with the discussion of the operating and financial results for the quarter. Production in the first quarter of 2025 was 2,814 BOE/d. That was a 3% increase from our production levels in Q4 2024. Netherlands non-operated production was up substantially, a 21% increase. That was driven by lower downtime. Canadian production was down slightly, but we were aided by bringing on our three new wells from this year's drilling program towards the end of the first quarter. Current Canadian production rate is around 2,450 BOE/d. Netherlands produced about 1,000 BOE/d during the quarter. We drilled three wells in Canada, 2.4 net to our interest. All were horizontal wells in the Glauconite and Ellerslie formations.
None of these were stimulated. In the Glauconite-A pool, we drilled a single lateral horizontal, produced an initial rate of over 600 BOE/d, 43% oil in the mix. We have an 87.5% working interest in that well. Quite successful. Extended the pool to the north, and this is one of the leasehold assets that came along with our Wadalite plant acquisition that we made during 2024. The second well that we list here is in the Leduc-Woodbend area. It's in the Glauconite formation, not in the wreck zone that we mainly develop at Leduc-Woodbend. Glauconite-D is under water flood. This multilateral well unstimulated, produced at an initial rate of about 90 BOE/d, 70% oil. We have a 52% working interest in this well. Not as productive as the other wells in the program, less than we would have expected.
We are still going to do some investigation about why that well is not as productive, but basically our unstimulated horizontal concept there in the water flood did not work out quite as well as anticipated. The third well is in the Ellerslie-A pool. That is also in the Wadallette area, leasehold that we picked up with the Wadallette plant acquisition. It is an extension of this pool to the east. The well is adjacent to the first well that we drilled in this pool last year. That first well was very successful. We drilled a second well, pretty successful as well, to the west of the first one. Now this third well drilled in 2025 is to the east of the previous two wells in this Ellerslie-A pool. Multilateral well, of course, unstimulated, initial rate of about 300 BOE/d, 60% oil.
We have 100% working interest in that well. In characterizing the overall program, we think it was quite successful. The Glauconite-A and the Ellerslie-A wells, very successful. These are batteries that cannot handle necessarily at this point all of the productivity available in the two new wells, and we will be doing some modifications to allow them to produce closer to their potential, expect to get increases in production out of that. Glauconite-D pool, again, I mentioned that before in the water flood, not quite as successful as we thought, and not necessarily looking for an increase in production out of that well. Overall program, even before the battery optimizations on the Glauconite-A and the Ellerslie-A, about 900 BOE/d in line or better, perhaps, than our original expectations.
A successful program outside of the main wreck zone that we developed at Leduc-Woodbend, done in a pretty capital-efficient manner, about CAD 8 million of capital employed to do this, and probably will bring to a close the Canadian drilling for this year. With respect to cash flow for the quarter, FFO in Q1 was CAD 1 million. That is down from over CAD 8 million that we recorded in Q4 2024. Drivers of this: transaction costs, net interest on the senior notes that we issued in Q4, and the absence of a tax recovery that we recorded in the previous quarter. Working capital at the end of Q1 2025, basically neutral, showed a negative CAD 500,000 position, and we had an unrestricted cash position of CAD 136 million at the end of Q1.
I'll talk about it in a minute, but this cash position was augmented by the net cash that we received at closing of NOBV. Final point on this slide, we renewed our normal course issuer bid program in February. It allows us to purchase up to CAD 2.5 million in additional shares in the market. I just got this program going later in the quarter, and from that, in Q1, we retired 62,000 additional shares at an average cost of CAD 13.42 per share. Since we started this program in 2022, we've retired 2.1 million common shares at an average cost of CAD 3.11 per share. Next, let's talk about the closing of the NOBV acquisition. As we put out a press release announcing this, we closed on May 1. That was two months ahead of schedule.
A great set of work done by our team in Calgary, by our new colleagues in Netherlands, who worked on it from NOBV's perspective. Great work as well in cooperation from the personnel at NOM and from our sellers, NOM and their two shareholders, Shell and Exxon. We're really proud of this achievement. It's a great asset base, quite a testament to the hard work and diligence and competence of our people that we were able to get it done two months ahead of schedule. That's desirable because it gives us access to the assets, control of the assets earlier, allows us to get started on our capital program, and also have Tenaz in control of the turnaround activity that will occur during Q2 of this year.
A lot of advantages to getting started early, and again, thank you to all of our staff and a welcome to all of our new employees. Simultaneous with the closing, we renamed NOBV Tenaz Energy Netherlands. Henceforth, you'll hear us talking quite a bit about our TEN subsidiary. As a result of the free cash flow and other purchase price adjustments that occur from the effective date of the transaction on January 1, 2024 until we closed it on May 1, 2025, we received about EUR 15 million cash at completion.
To go with that, on this next bullet, we point out that our estimate of the working capital in the TEN subsidiary, again, the cash is received and carried at a higher level within Tenaz than TEN, but the working capital estimate at the TEN subsidiary is basically neutral, excluding what will be the current portion of our estimated future contingent earnout payments. When we release Q2, we'll show a complete balance sheet for the company, and this will reflect estimated earnout payments that need to be made and may have some updating and adjustments to the working capital position. What we're trying to get across here is that other than the earnout, we think that the working capital that we received in the corporation, the TEN subsidiary corporation, was basically neutral, EUR 15 million at the higher Tenaz level.
It is not a new set of information in this last bullet. We just point out the reserve and estimated value totals for the assets based on an independent assessment by McDaniel, as at the end of 2024, reserves of approximately 56 million barrels of oil equivalent, almost entirely TTF gas, and an after-tax PB10 of EUR 618 million. Next, I want to move to a discussion of our 2025 guidance. That is where we can talk about our intended capital program on these assets. First of all, to talk about our 2025 activity, the first item already discussed, we executed the Q1 Canadian program, which was a three-gross well, 2.4 net Ellerslie and Glauconite drilling with the results that we have already talked about.
In the second bullet, we point out that we have a non-operated well planned in Netherlands called Malachite, going to be drilled late in the year, expect to get production on at the beginning of 2026. That's a 21% working interest for Tenaz on that well. Again, that was previously disclosed. A new item on the third bullet here, which we announced with the closing a week ago, is that we project drilling and development CapEx of CAD 55 million-CAD 61 million on the NOBV assets, now renamed Tenaz Energy Netherlands. Three quarters of that will be directed to drilling and workover activity, about 25% to facility projects. We do have quite a deep inventory of projects. It will take a little time to get the capital program up and running. Previous owners had a very, very low level of capital investment into the assets.
You can't start up immediately on the program, but we're trying to put all of the necessary project design, permitting, contracting, purchase of long lead time items in motion now such that we can invest at a fairly strong level this year. The timing of the program is that we would hope to get a barge in to do more major workovers on wells, probably in the last four months of the year or earlier if we can manage it, and to begin drilling at a target at the beginning of Q4. The production impacts from this program would be felt, because of the late timing, primarily in 2026, although, of course, some of the workovers may begin to have an impact in 2025.
The drilling program, we would expect to start at our K7 Papa South pool, and we would think that that would be a continuous drilling program that would stretch well on into 2026. I would say probably at least a four-well drilling program and perhaps more, but a target of getting that activity going at Q4 2024. We're going to do this program efficiently, and we're going to do this program safely. Of course, we aren't going to start that activity until organizationally and in concert with our vendors that will be executing the program with us until it can be done in a completely safe and environmentally protected manner.
The next bullet points out that we will continue with our evaluation activities on the potential CCS project that was already in our portfolio prior to the closing of NOBV, and that has a feed capital estimate of CAD 1.7 million in our E&E category. Of course, the final bullet, we continue our disciplined M&A efforts in a variety of potential projects. We've got a very strong transaction pipeline, and we can't guarantee the timing, and we don't guarantee even if any additional deals will occur, but we like what we are maturing in the portfolio, and at such time as we have a definitive agreement on a project, we would make an announcement about what that project is and its impact on the company. With respect to guidance, we point out that, first of all, deal with the CapEx.
When you add in this estimate of $55-$61 million in D&D CapEx for the new TEN assets, it brings our total D&D CapEx range to the year to CAD 85 million-CAD 95 million. The production forecast that we have made of the properties was detailed in our press release about the closing on May 1. I'll point out that the assets produced 11,000 BOE/d for the first four months of the year, and that's actually the same rate as we reported at the time we made the acquisition in the middle of 2024, so we're very happy with that production performance. We will have turnaround activity, major turnarounds in Q2. This is always the timing for doing these based on weather and services availability.
Since we have closed on May 1, it does give Tenaz the ability to manage that turnaround program, which we think is something we wanted and is desirable to have that control. That will cause lower production in Q2. We would see that production rebounding in Q3 and Q4 such that for the year as a whole, we would average, we estimate 10,000 BOE/d. Again, with most of the capital impacts on production occurring in 2026 and beyond, since we can only count toward our production totals the last eight months of the year after close, that brings our total annual production for Tenaz on an annual average basis, on a 12-month average basis to 9,000-9,500 BOE/d, accounting for the roughly 3,000 BOE/d that we already had in the portfolio.
With respect to production mix, we are now heavily weighted toward TTF with a meaningful contribution still from Canadian oil and NGLs and 10% of the production mix coming in from Canadian or ACO index gas. With respect to hedging, we show this separately for TTF and ACO. TTF is the product that really matters, about a 50% hedge position for this year for TTF at prices that are just about in line with the market today, around EUR 35 per megawatt hour. A good hedge position and one that continues on at a little bit lower volume levels in 2026. Moving on to the Tenaz record, a brief update on that. We typically have shown the company's performance since the recap a little less than four years ago. Numbers dramatically higher, including this eight months of impact from the acquisition of NOBV, now in our TEN subsidiary.
If you look at production on the lower left, it's now a nine-fold increase since the time of the recapitalization. In terms of FFO on the lower right, substantial increase of about 25-fold from the levels at that time. Again, here we've just made an estimate at the strip of what NOBV would contribute for the last eight months of the year after closing. We did point out in our press release that had we closed at the beginning of the year, Q1 FFO would have been about CAD 51 million higher as a result of the contribution of NOBV. We take into account for the rest of the year the current price conditions, which are lower than in Q1, and the downtime that we'll have during the turnaround activity, and we have the resulting forecast of FFO that we show here.
In terms of total return for Tenaz, it's about a 700% TSR since the recapitalization at $1.80 in Q4 2021. I'll summarize just by reminding our listeners about the Tenaz model and advantages that we believe we bring to bear. First of all, the company's model is based on overseas acquisitions. We think that we can acquire typically at lower multiples overseas. We combine that with a second advantage of having typically a greater opportunity to improve operations, increase production, and reduce unit costs. That's what we seek to do with NOBV and our new team members. The combination of those two, we think, can give us outsized returns. We do this in two main regions in Europe and Latin America, both areas that we are seeking transactions currently.
I think that that broad range of geographic coverage and experience that we have gives us plenty of opportunity to make some transactions that will add value for our shareholders. Second point is that the team is experienced in this strategy. We believe that the NOBV transaction has demonstrated this. Again, we're very happy to bring on a very experienced operating team with NOBV that will help us achieve that second part, the improvement in operations. Thirdly, the team, the management, the board of directors, and all of our employees are aligned with the rest of our shareholder set and the equity ownership and focused on providing shareholder returns. In closing, I would ask you to note our disclaimer and thank you for your attention to our Q1 2025 results. We look forward to chatting with you again when we release our Q2 results. Thank you.