Tourmaline Oil Corp (Alberta) T.TOU

RBC

[retiredcf]

March 6, 2024

Tourmaline Oil Corp. Q4/23 - Managing the Macro

TSX: TOU | CAD 63.06 | Outperform | Price Target CAD 80.00

Sentiment: Neutral

Tourmaline's Q4/23 results were slightly ahead of Street expectations, with 2024 capital and production guidance both revised downwards, though we highlight that the volume reduction was essentially all natural gas (liquids outlook is largely static). On the reserves front, TOU highlighted another year of solid reserve additions (+20%/+10% in both the PDP and 2P categories), largely driven via Bonavista. The 5-year plan was also updated and now features the company reaching 715,000 boe/d by 2028 (previously 720,000 boe/d). TOU declared a $0.50/share special dividend for Q1 and increased its base dividend by 7% (now $1.20/share annualized). Tourmaline remains best of breed in our opinion and continues to be featured on our RBC Global Energy Best Ideas List.

Conference Call

• 11:00am ET (9:00 am MT) on Thursday, March 7, 2024 | Dial-in: 1-(888)-664-6383

[retiredcf]

Key Points: Q4/23 production of 556,957 boe/d (24% liquids) compared to RBCe at 556,180 (Street: 556,600 boe/d) and drove AFFO of $2.62 slightly ahead of our estimate of $2.59/sh (Street: $2.48/sh). Capital investment of $636 million compared to Street expectations at $630 million as $282 million in FCF was generated in the quarter.