Alvopetro Energy Ltd (TSX-V:ALV, OTC:ALVOF, FRA:A6Y0) reported higher first quarter revenue, earnings and production as increased natural gas sales volumes in Brazil helped drive record quarterly sales for the company.

The Calgary-based oil and gas producer said total average daily sales reached a record 3,128 barrels of oil equivalent per day (boepd) in the three months ended March 31, up 28% from a year earlier and 9% from the prior quarter.

Revenue from natural gas, oil and condensate sales rose 24% year over year to $17.4 million, while funds flow from operations increased to $12.5 million from $9.2 million in the same quarter last year.

Net income climbed to $8.1 million, or $0.22 per basic share, compared with $6.1 million a year earlier.

The company's Brazilian operations continued to account for the majority of production. Average daily sales in Brazil rose 20% year over year to 2,935 boepd after Alvopetro and Bahiagás amended their long-term gas sales agreement to increase firm gas sales volumes by 25% for 2026 and 2027. Canadian production averaged 193 bopd during the quarter.

Alvopetro said its average realized natural gas price was $10.14 per thousand cubic feet, down 3% from a year earlier but 2% higher than the previous quarter. The company's overall realized sales price averaged $61.77 per boe.

The company also provided an update on pricing under its long-term gas sales agreement in Brazil. Effective May 1, natural gas pricing on contracted volumes increased between 3% and 21%, depending on the volume tranche. Based on current exchange rates and benchmark pricing assumptions, Alvopetro expects its weighted average realized natural gas price for the May through July period to rise to about $11.31/Mcf, up 12% from the first quarter.

For the August through October pricing period, the company forecast an average realized price of $13.06/Mcf, subject to exchange rates and commodity benchmark prices.

"We delivered a strong start to 2026 with another record of quarterly sales at 3,128 boepd, driving funds flow from operations of $12.5 million," Alvopetro CEO Corey Ruttan said in a statement.

"This performance underscores the quality of our asset base and our ability to fund organic growth while continuing to return significant capital to our shareholders."

In operational updates, Alvopetro said it has started drilling the 183-D1 well on its Murucututu field in Brazil and has begun construction on a new drilling pad for future development.

In Canada, the company completed two additional wells in Saskatchewan during the quarter and now has seven gross wells on production.