Advantage Energy Ltd T.AAV

2022 Budget

[Betteryear2]

(TSX: AAV)

CALGARY, AB, Dec. 6, 2021 /CNW/ - Advantage Energy Ltd. ("Advantage" or the "Corporation") is pleased to announce its 2022 budget.

Advantage's 2022 capital program will be focused on growing adjusted funds flow per share by continuing to drill high rate-of-return targets in areas with existing infrastructure capacity.  An escalating emphasis will be placed on increasing liquids revenue and making infrastructure investments that either expand third-party processing revenue or advance our net-zero 2025 target.  With gas prices currently elevated and robust oil prices, we expect bank indebtedness to fall to zero in the second half of 2022 with significant free cash flow available to fortify the foundations of our business.

Highlights of the 2022 Budget:

• Corporate production is expected to grow by approximately 8%, with total liquids production expected to grow by more than 25%.
• At NYMEX US$4/mmbtu and WTI US$70/bbl, adjusted funds flow ("AFF")(a) is expected to be $370 million.
• Cash used in investing activities is planned to be between $170 million and $200 million representing a payout ratio(b) of approximately 50% (including provisions for inflation).
• Revenue growth will be optimized by focusing on the highest rate-of-return development drilling in areas with existing facilities capacity (Glacier and Wembley).
• Sustaining capital for 2022 is approximately $75 million and includes drilling 9 Glacier wells to replace corporate decline of 24%.
• Half of the drilling program will focus on gas-weighted assets, and half will focus on oil-weighted assets. At current strip pricing, production periods required to payout new wells are approximately 7 months for Glacier gas wells and 8 months for Wembley oil wells.
• The Wembley oil battery will be connected to the Keyera Pipestone Processing Facility during the first quarter, increasing total third-party processing capacity to 40 mmcf/d. Advantage's total take-or-pay volumes at Wembley, including existing Tidewater service, will average 13.5 mmcf/d for 2022 before rising to 23 mmcf/d in 2023.
• The Progress compressor station (partially constructed in 2020 prior to the pandemic) is planned to be completed by early second quarter, at a cost of $12 million. Up to three new Progress wells are planned for 2022, and a third-party has committed to tie-in approximately 10 mmcf/d for transportation and processing through our Glacier Gas Plant. Third-party processing revenue is expected to pay out the remaining cost of the project within three years.
• Phase 1 of the Glacier carbon capture and storage ("CCS") project is expected to come onstream by early second quarter, with 2022 capital expected to be $7 million.

 

[loonietunes]

Andy is done at year end, the full release follows below.   Advantage Energy sets 2022 budget at $200-million   2021-12-06 18:22 ET - News Release   Mr. Craig Blackwood reports ADVANTAGE ANNOUNCES 2022 BUDGET, INCLUDING STRATEGIC GROWTH OF LIQUIDS, GAS AND MIDSTREAM ASSETS Advantage Energy Ltd. has released its 2022 budget. Advantage's 2022 capital program

[mjh9413]

Can it get from $46MM AFF last qtr to proj $370MM fy 2022? Guess with condensate growth and no current hedges in 2022 and with 21% hedges on natgas coming off over winter it might be possible, but seems a little tentative given NYMEX/AECO gas prices likely to back off in spring if not before and drilling being promoted to offset 24% decline rate...that means lots of good finds. Anyone?

[RJboxer]

With a projected AFF of $370 million how about doing something for the shareholder who has held the stock through the most dire times. A dividend or even a stock buyback program would be nice. 

[byloselhir]

This is my point with all the O&G stocks i own, most didn't buy shares when they were at a huge discount and i took the risk of buying so don't use my money to buy them 200/300%+ higher, give me a divi

[RealVal]

This post has been removed in accordance with Community Policy