Ovintiv’s 2021 planned budget guidance investments are approximately $1.5 billion for 2021

OVINTIV 2021 budget guidance Outlook, Suttles said, “Our strong performance in 2020 sets us up well to deliver once again in 2021. We expect this will be our fourth consecutive year of generating significant free cash flow and we are confident in our ability to meaningfully reduce our debt over the next two years. Longer-term, our ongoing capital discipline and reinvestment rate commitment ensure that we will be able to return cash to shareholders – all critical components of the ‘new E&P’ company.”

Download OVINTIV Well Permits Last 2 Years

Ovintiv’s 2021 planned capital investments are approximately $1.5 billion and are expected to generate non-GAAP Free Cash Flow of approximately $1 billion, assuming commodity prices of $50 WTI and $2.75 NYMEX. The capital program represents a cash flow reinvestment rate of about 60%, significantly lower than the Company’s framework of less than 75%.

Over 90% of total capital investment is earmarked for Ovintiv’s Core 3 assets—Permian, Anadarko and Montney. The Company plans to execute a load-levelled program with consistent quarterly levels of activity and capital spending.

Crude oil and condensate volumes are expected to be relatively flat through the year, averaging approximately 200 Mbbls/d. Full-year NGL (C2 – C4) production is expected to be approximately 80 Mbbls/d and natural gas is expected to average approximately 1.55 billion cubic feet per day (Bcf/d). Total costs in 2021 are expected to average approximately $12.25 to $12.50 per barrel of oil equivalent (BOE).

Ovintiv has strong risk management positions in place with about 65% of 2021 crude oil and condensate and natural gas production hedged. The majority of the hedges are in three-way structures that provide exposure to higher oil prices. Hedge tables can be found below.

Oil & Gas News

Ovintiv Drilling Activity Last 2 Years

Production Summary and Asset Highlights
Ovintiv’s significantly higher than expected fourth quarter production was largely driven by strong well results across the portfolio. The Company’s cube development approach and innovative completion designs continued to deliver industry-leading capital efficiencies. Fourth quarter crude oil and condensate volumes were 215 Mbbls/d. Fourth quarter liquids production averaged 297 Mbbls/d and total Company production was 557 MBOE/d.

For the year, total production averaged 544 MBOE/d including liquids production of 289 Mbbls/d. See the “Capital Investment and Production” table below.

In the fourth quarter, Ovintiv set new, record-low well costs in each of its Core 3 assets. The Company exceeded its stated goal of reducing 2020 well costs by 20% when compared to 2019 averages by delivering cost reductions of 25% or greater during the quarter.

“Ovintiv has demonstrated industry-leading capital efficiencies across our portfolio,” said Suttles. “The efforts of our teams to consistently find innovative ways to reduce costs have led to sustainable capital savings that will be durable even as commodity prices improve. More importantly, they never lost their focus on safety and 2020 marks our ‘safest year ever’ for the seventh consecutive year.”

Permian
Permian production averaged 110 MBOE/d (81% liquids) in the fourth quarter. The Company averaged three rigs, drilled 22 net wells, and had 29 net wells turned in line (TIL).

Fourth quarter drilling and completion (D&C) costs per lateral foot was $470, down more than 30% compared to 2019 average D&C cost.

Full year production in the play averaged 109 MBOE/d (81% liquids).

Anadarko
Anadarko production averaged 134 MBOE/d (62% liquids) in the fourth quarter. The Company averaged two rigs, drilled 11 net wells, and had 28 net wells TIL.

Fourth quarter D&C costs per lateral foot was $440, down over 30% compared to 2019 average D&C cost.

Full year production in the play averaged 144 MBOE/d (62% liquids).

Montney
Montney production averaged 222 MBOE/d (26% liquids) in the fourth quarter. The Company averaged four rigs, drilled 22 net wells and had 28 net wells TIL.

Fourth quarter D&C costs per lateral foot was $380, down approximately 25% compared to 2019 average D&C cost.

Full year production in the play averaged 204 MBOE/d (25% liquids).

Free Weekly Oil & Gas Permit Report