BKV reported third-quarter 2026 results and outlined two power-development arrangements, including a cost-reimbursement agreement supporting a planned expansion at its Temple, Texas, energy complex. It also said Verra certified carbon credits for carbon dioxide permanently sequestered through its carbon-capture operations, opening a route to monetize that activity.
The quarter included $29.4 million of net income attributable to BKV, while the company also completed a $575 million convertible-note offering. Its power agreements are intended to let project development continue while longer-term commercial arrangements are pursued.
Quarterly results and operations
- BKV recorded net income attributable to the company of $29.4 million, or $0.27 per diluted share. Adjusted net income was $39.9 million, or $0.36 per diluted share.
- Adjusted EBITDAX attributable to BKV was $132.7 million.
- Cash from operating activities was $164.5 million. Excluding working-capital movements, it was $112.7 million.
- Accrued capital expenditures were $77.8 million. Adjusted free cash flow before power growth, attributable to BKV, was $31.2 million.
- Average net production was 981.2 million cubic feet equivalent per day. The Temple plants operated by BKV’s Power JV generated 2,317 gigawatt-hours.
- BKV’s carbon-capture, utilization and storage operations sequestered about 55,200 metric tons of carbon-dioxide equivalent during the quarter.
- The company reported a 2.41x net leverage ratio.
Temple power project: planned capacity doubles
- BKV’s Power JV reached a cost-reimbursement agreement with an unnamed “leading frontier AI lab” in connection with expanding planned modular power generation at the Temple Energy Complex from 200 megawatts to 400 megawatts.
- The agreement is intended to allow BKV to keep the development schedule moving while it negotiates a long-term power purchase agreement with the intended offtaker.
- If the parties do not agree on offtake arrangements by November 18, 2026, the agreement provides for reimbursement of up to approximately $179 million. The parties can mutually extend that date to December 21, and may agree to further extensions.
- The intended offtaker may instead take over the equipment supply contract if the Power JV does not retain it. In that case, it would reimburse eligible costs, subject to an aggregate cap of $374.1 million. The release does not identify the lab or provide the final terms of a long-term power sale.
Separate Texas project and hyperscaler backstop
- BKV also reiterated that a wholly owned subsidiary had entered into an equipment supply agreement with a Tier 1 supplier for combined-cycle gas turbine equipment for a prospective Texas power project of about 1.2 gigawatts.
- A leading investment-grade hyperscaler has agreed to reimburse a portion of BKV’s costs for that equipment and related project work. The hyperscaler is also the project’s intended offtaker. This is a separate project from the Temple modular development.
Carbon credits and financing
- BKV said it was the first company to receive Verra carbon-credit certification for carbon dioxide permanently sequestered through its CCUS operations. The certification enables the company to monetize credits through its Carbon Sequestered Gas product, which it describes as third-party-verified carbon-neutral natural gas. BKV said it can now begin delivering the product, but the announcement provided no further delivery or commercial terms.
- BKV completed a $575 million offering of convertible senior notes carrying a 1.625% annual interest rate. The announcement did not provide additional note terms.