ALBERTA - Whitecap Resources Inc. ('Whitecap' or the 'Company') (TSX: WCP) is pleased to report its operating and unaudited consolidated financial results for the three and nine months ended September 30, 2021.
Selected financial and operating information is outlined below and should be read with Whitecap's unaudited interim consolidated financial statements and related Management's Discussion and Analysis for the three and nine months ended September 30, 2021 which are available at www.sedar.com and on our website at www.wcap.ca.
MESSAGE TO SHARESHOLDERS
Whitecap is pleased to report another exceptional quarter of operating and financial performance. We achieved average production in the third quarter of 115,935 boe/d which was 1,935 boe/d higher than our forecast of 114,000 boe/d as both our base production and new well results continue to outperform our expectations. We remain disciplined on capital investments with only $135 million invested in the third quarter compared to our forecast of $165 million.
Record quarterly funds flow of $294 million ($0.46 per share) resulted in discretionary funds flow of $128 million after capital investments of $135 million and dividends paid to shareholders of $31 million. Net income of $1.5 billion includes an after-tax impairment reversal of $1.4 billion due to increases in forward benchmark commodity prices.
Contact:
Grant Fagerheim
Tel: (403) 266-0767
Web: www.wcap.ca
Note Regarding Forward-Looking Statements
This press release contains forward-looking statements and forward-looking information (collectively 'forward-looking information') within the meaning of applicable securities laws relating to the Company's plans and other aspects of our anticipated future operations, management focus, strategies, financial, operating and production results and business opportunities. Forward-looking information typically uses words such as 'anticipate', 'believe', 'continue', 'trend', 'sustain', 'project', 'expect', 'forecast', 'budget', 'goal', 'guidance', 'plan', 'objective', 'strategy', 'target', 'intend', 'estimate', 'potential', or similar words suggesting future outcomes, statements that actions, events or conditions 'may', 'would', 'could' or 'will' be taken or occur in the future, including statements about our strategy, plans, focus, objectives, priorities and position; the anticipated benefits of the Southeast Saskatchewan acquisition; our expected debt to EBITDA ratio of 0.9x by year end 2021 based on strip prices; estimated $10.7 million per well costs, ability to reduce such original estimate by 5-10% and potential for further improvements with the Karr and Kakwa assets; timing to spud a 4 well pad at Karr; potential to further reduce well costs to $1.0 million per well and spud to rig release times to 4 days in Whitecap's Lower Shaunavon program; the anticipated benefits of future CO2 flood well designs; that operational success and corporate activities will translate to meet short and long term targets; our 2021 average production and capital spending; our 2022 average production and capital spending; our expectation to reach $1.0 billion net debt by year end 2021; our anticipation to direct 50% of 2022 discretionary funds flow to shareholders and 50% towards our balance sheet and the benefits to be derived therefrom; the expected strength in crude oil and natural gas prices in the fourth quarter of 2021 and into 2022 and that fossil fuel energy will remain an important part of the energy transition for many years to come.
The forward-looking information is based on certain key expectations and assumptions made by our management, including expectations and assumptions concerning prevailing commodity prices, exchange rates, interest rates, applicable royalty rates and tax laws; the impact (and the duration thereof) that the COVID-19 pandemic will have on (i) the demand for crude oil, NGLs and natural gas, (ii) our supply chain, including our ability to obtain the equipment and services we require, and (iii) our ability to produce, transport and/or sell our crude oil, NGLs and natural gas; future production rates and estimates of operating costs; performance of existing and future wells; reserve volumes; anticipated timing and results of capital expenditures; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the state of the economy and the exploration and production business; results of operations; performance; business prospects and opportunities; the availability and cost of financing, labour and services; the impact of increasing competition; ability to efficiently integrate assets and employees acquired through acquisitions, ability to market oil and natural gas successfully and our ability to access capital.
Although we believe that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Whitecap can give no assurance that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature they involve inherent risks and uncertainties. These include, but are not limited to: the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production; pandemics and epidemics; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of estimates and projections relating to reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; interest rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to complete or realize the anticipated benefits of acquisitions or dispositions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals; reliance on third parties and pipeline systems and changes in legislation, including but not limited to tax laws, production curtailment, royalties and environmental regulations. Our actual results, performance or achievement could differ materially from those expressed in, or implied by, the forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that we will derive therefrom. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide security holders with a more complete perspective on our future operations and such information may not be appropriate for other purposes.
Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect our operations or financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).
These forward-looking statements are made as of the date of this press release and we disclaim any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
This press release contains future-oriented financial information and financial outlook information (collectively, 'FOFI') about run rate operating income on the Southeast Saskatchewan acquisition; Whitecap's 2021 capital investments; 2021 year-end net debt; 2022 capital investments; total credit capacity and debt to EBITDA ratio, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. The actual results of operations of Whitecap and the resulting financial results will likely vary from the amounts set forth in this presentation and such variation may be material. Whitecap and its management believe that the FOFI has been prepared on a reasonably basis, reflecting management's best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, Whitecap undertakes no obligation to update such FOFI. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about Whitecap's anticipated future business operations. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein.