PrairieSky Receives TSX Approval for Renewed NCIB

PrairieSky Royalty Ltd. (TSX:PSK) received TSX acceptance for its renewed normal course issuer bid, authorizing the purchase of up to 17,554,375 common shares. That represents roughly 7.6% of the 232,442,555 shares outstanding as of May 21, 2026, and 10% of the public float of 175,543,755 shares. The new NCIB runs from June 4, 2026 to June 3, 2027, replacing the current bid that expires June 3, 2026.

The buyback signal is management’s direct statement that the stock trades below perceived intrinsic value. Execution, however, depends on daily volume constraints, commodity prices, and the company’s cash flow from royalty revenue. The risk event is not the authorization itself – it is whether PrairieSky actually executes at a rate that changes the shareholder equation.

Buyback Parameters and Daily Limits

The TSX approval came on May 31, 2026, following PrairieSky’s April 20 announcement of its intention to renew. The NCIB carries standard TSX constraints:

• Daily purchase limit: 123,171 shares, calculated as 25% of the six-month average daily trading volume (492,686 shares, period ended April 30, 2026).
• Block purchase exception: One block trade per calendar week exceeding the daily limit is permitted.
• Cancellation: All repurchased shares will be cancelled, increasing proportionate ownership for remaining holders.

These limits are material for execution risk. With ADTV of roughly 493,000 shares, PrairieSky can buy up to a quarter of daily volume every session. That is enough to provide steady support without forcing a squeeze – liquidity is sufficient for gradual accumulation.

Automatic Share Purchase Plan – Blackout Coverage

PrairieSky entered an automatic share purchase plan (ASPP) with its broker. The ASPP allows purchases during regulatory blackout periods and self-imposed quiet windows – times when the company would normally be barred from buying. The broker executes purchases based on parameters prescribed by the TSX and the parties’ written agreement.

This mechanism is standard for large buyback programs. It removes the risk that management halts purchases during earnings blackouts or commodity price volatility. For shareholders, the ASPP means consistent buying even when the company cannot actively direct the broker.

Previous Buyback Track Record – 23.2 Million Shares Since 2016

PrairieSky has a long history of NCIB execution. Since instituting its first buyback in 2016 through March 31, 2026, the company has purchased and cancelled an aggregate of 23.2 million common shares at a weighted average price of $17.81 per share.

Under the current NCIB (authorized to buy up to 15,355,946 shares, started June 4, 2025), PrairieSky bought 3,092,684 shares on the TSX and alternative trading systems. That execution rate – about 20% of the maximum authorization – sets a practical floor for expectations. The new authorization is larger (17.55 million versus 15.36 million), and the same ratio would imply roughly 3.5 million shares repurchased over the next 12 months, or about 1.5% of outstanding.

Key insight: The weighted average price of $17.81 is a useful benchmark. If PSK trades significantly above that level, management may slow purchases. If the stock falls below, the buyback could accelerate.

Capital Allocation Context – Competing With Dividends and Cash Flow

PrairieSky generates royalty revenues from oil and natural gas production on its fee-simple mineral title lands – the largest such position in Canada. The company’s model requires low capital expenditure compared to producers. That structural advantage allows higher free cash flow return to shareholders.