updateNo Dividend cut!!!!!
CALGARY, ALBERTA--(Marketwired - Dec. 18, 2014) - Bonterra Energy Corp. (www.bonterraenergy.com) (TSX:BNE) ("Bonterra" or "the Company") today provides an update on the Company's position in light of recent market and industry developments. As a resource based business, Bonterra is directly impacted by changes in commodity prices, and recently has been managing through an unexpected period of significant oil price declines. Due to this rapid price erosion and extreme volatility, accurately forecasting events and price levels over the next month is difficult and even more difficult over the coming twelve month period.
In light of this uncertainty, Bonterra is taking a patient and measured approach to its corporate planning and has concluded that it will assess the ongoing situation on a monthly basis. Continuing to manage the Company's balance sheet is of prime importance and will always be the main consideration when capital expenditure budgets and dividend payouts are determined.
Supported by its high-quality asset base and conservative approach to managing these assets, in the near term Bonterra will:
- continue to manage its debt level so that current balance sheet strength is not compromised, and will maintain a net debt to cash flow ratio that does not exceed 1.5 to 1.0 times, calculated on a trailing four quarter basis;
- not reduce its current dividend payments;
- proceed with a capital expenditures program that includes the completion of nine wells in Q1 2015 which were drilled in the latter part of 2014, and continue with a single rig drill program under a pad development scenario;
- undertake a thorough review of all expenditure areas, including capital expenditures, operating costs and general and administration costs with the view to supporting cash flows; and
- provide further guidance on capital spending plans as stability is regained in the broader market.
Consistent with its history, Bonterra is committed to maintaining a prudent and disciplined approach during this period of uncertainty and significant price volatility. The Company's priorities remain focused on maintaining financial flexibility while positioning the Company to achieve long-term per share growth and paying out a sustainable dividend to shareholders.