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Ovintiv IDs 2021 Budget; Talks Preliminary Q4, Full Year 2020 Results

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   |    Monday,January 04,2021

Ovintiv Inc. announced preliminary financial results and select operating metrics for its fourth quarter and fiscal year ended December 31, 2020.

2021 Plans

In 2021, the Company plans to invest approximately $1.5 billion (vs. $1.75B in 2020) to deliver average annual oil and condensate production of 200 Mbbls/d (compared to 210 Mbbls/d in 2020).

This represents an estimated reinvestment rate of less than 70% of non-GAAP cash flow and more than $800 million of non-GAAP free cash flow at $45 WTI and $3 NYMEX natural gas.

Q4 / 2020 Highlights:

  • Reduced total long-term debt, including current portion, by $257 million in the fourth quarter. Ovintiv has been focused on debt reduction and has a plan to reduce total debt by at least $1 billion from the second half of 2020 through year-end 2021. As of year-end 2020, the Company is nearly halfway to achieving its year-end 2021 target.
  • Delivered strong well performance, driving fourth quarter oil and condensate production of more than 210 thousand barrels per day (Mbbls/d), above guidance of 200 Mbbls/d; Fourth quarter total production was more than 550 thousand barrels of oil equivalent per day (MBOE/d).
  • Recorded full-year 2020 production of more than 540 MBOE/d.
  • Maintained disciplined capital investment program. Full-year 2020 investments are expected to be ~$1.75 billion, less than guidance of $1.8 billion; Further capital efficiency gains achieved with fourth quarter average completed well costs approximately 25% lower than full-year 2019 averages; new pacesetter well costs attained in each of the three core plays.

Ovintiv CEO Doug Suttles said, "We finished 2020 with one of our best quarters, achieving outstanding financial and operating results that will likely be well ahead of consensus. 2020 was an incredibly challenging year but showed our strengths through a high-quality portfolio, industry-leading efficiencies and world class risk management. For the third consecutive year, we delivered meaningful free cash flow. We enter 2021 with high confidence in our ability to deliver on our $1 billion-plus debt reduction target while efficiently maintaining our scale."

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