23 will be a good year management looking to smash the NCIB With current forecasts of oil prices to exceed US$80 WTI in 2023, we currently expect to have significant free cash flows in excess of our base budget and dividend outlay plans.
The excess free cash flow will first be applied to reducing our net debt to zero. With current higher interest rates the cost to borrow is close to the dividend yield. After our debt is fully repaid, funds previously used for interest can be repurposed.
Our second priority after our debt is eliminated will be to increase returns to shareholders in 2023 via dividends and purchases under our NCIB. With the recent federal government announcement of a tax on share buybacks in 2024 we expect companies will be motivated to increase buyback activities in 2023.