Summary: Battalion Oil Corp. reported a decisive operational improvement after finalizing a gas treating agreement with a large-cap midstream provider, which resolved a production bottleneck that had constrained output since August 2025. The announcement drove a 410.9% premarket surge in the company's stock and coincides with a notable uptick in daily gas processing and oil production.
The Houston-based exploration and production company increased its daily gas processing capability from 17.4 million cubic feet (MMcf) in December to more than 30 MMcf per day in January. Management says that boost in gas handling has directly supported an approximate gain of 1,200 net barrels per day in oil production month-to-date.
Operationally, Battalion terminated its previous arrangement with Wink Amine Treater (WAT), which had been offline for months and had been a central factor in the production constraint. The newly contracted midstream partner recently expanded its facilities, enabling it to accept and process nearly all of Battalion's volumes from its core Monument Draw Field.
Investor interest had been growing ahead of the announcement. A Schedule 13D filing with the Securities and Exchange Commission dated January 21, 2025, discloses that Diveroli Investment Group LLC and Kingbird Ventures LLC together hold a 5.39% stake in Battalion, representing 887,455 shares acquired at an average price of $1.18 per share via open market purchases.
Prior to the operational fix, Battalion's shares faced downward pressure driven by NYSE listing compliance concerns and the processing constraints that curtailed production. The resolution of those constraints has prompted high-volume buying as market participants appear to reassess the company's immediate cash flow and growth outlook. Company commentary framed the transition as a movement out of "survival mode" and toward a stabilized growth position with improved cash flow prospects.
While the operational details center on gas treating capacity and the termination of the WAT agreement, the broader market response underscores how quickly equity valuations can change when core production issues are addressed. For Battalion, the combination of increased processing throughput and restored field volumes appears to be the catalyst for renewed investor activity.
What changed operationally
- Daily gas processing capacity rose from 17.4 MMcf in December to over 30 MMcf in January.
- Oil output improved by roughly 1,200 net barrels per day month-to-date following the capacity increase.
- The company ended its agreement with Wink Amine Treater, shifting volumes to a midstream partner whose expanded facility can handle nearly all Monument Draw Field production.
Market and ownership notes
- Shares jumped 410.9% in premarket trading on the operational announcement.
- A Schedule 13D filing dated January 21, 2025, shows Diveroli Investment Group LLC and Kingbird Ventures LLC collectively owning 5.39% of the company, acquired at an average of $1.18 per share.