Ovintiv Inc. posted strong financial results for the first quarter of 2024, with net earnings of $338 million and robust cash flow of $1,035 million.
Oil & Gas Data Download
Ovintiv Wells Drilled Since 2023
Production exceeded expectations, with an average of 574 MBOE/d, and guidance for the full year was raised while capital investment remained unchanged. The company returned $328 million to shareholders through dividends and buybacks, maintaining a focus on balance sheet strength with $3.0 billion in liquidity. Ovintiv also released its 2023 Sustainability Report, highlighting achievements in environmental stewardship, social responsibility, and corporate governance. Overall, Ovintiv demonstrated solid operational performance, financial stability, and a commitment to sustainable practices and shareholder value.
Permian
Ovintiv’s activities in the Permian Basin:
- Production: Ovintiv achieved an average production of 206 thousand barrels of oil equivalent per day (MBOE/d) in the Permian Basin during the first quarter of 2024. This production comprised 82% liquids (oil and condensate).
- Wells: The company turned in line (TIL) a total of 21 net wells in the Permian Basin during the first quarter.
- Investment Plans: Ovintiv plans to invest approximately $1.35 to $1.45 billion in the Permian Basin in 2024. This investment aims to bring on 120 to 130 net wells in the region.
These details offer a comprehensive overview of Ovintiv’s production, drilling, and investment activities in the Permian Basin during the first quarter of 2024.
Montney
Ovintiv’s activities in the Montney region:
- Production: Ovintiv achieved an average production of 226 thousand barrels of oil equivalent per day (MBOE/d) in the Montney region during the first quarter of 2024.
- Wells: The company completed 11 net wells in the Montney area during the same period.
- Investment Plans: Ovintiv plans to invest approximately $425 to $475 million in the Montney region in 2024. This investment aims to bring on 60 to 70 net wells in the area.
These details outline Ovintiv’s production, completion, and investment strategies in the Montney region, providing a snapshot of its activities in that area during the first quarter of 2024.
Uinta
Ovintiv’s activities in the Uinta region:
- Production: Ovintiv achieved an average production of 28 thousand barrels of oil equivalent per day (MBOE/d) in the Uinta region during the first quarter of 2024.
- Wells: The company completed nine net wells in the Uinta area during the same period.
- Investment Plans: Ovintiv plans to invest approximately $300 to $350 million in the Uinta region in 2024. This investment aims to bring on 25 to 30 net wells in the area.
These details offer insights into Ovintiv’s production, completion, and investment strategies in the Uinta region, providing an overview of its activities in that area during the first quarter of 2024.
Anadarko
Ovintiv’s activities in the Anadarko region:
- Production: Ovintiv achieved an average production of 108 thousand barrels of oil equivalent per day (MBOE/d) in the Anadarko region during the first quarter of 2024.
- Wells: No net wells were turned in line (TIL) in the Anadarko area during the same period.
- Investment Plans: Ovintiv plans to invest approximately $100 to $125 million in the Anadarko region in 2024. This investment aims to bring on seven to ten net wells in the area.
These details provide insights into Ovintiv’s production levels, drilling activities, and investment plans in the Anadarko region during the first quarter of 2024.
Natural Gas
Ovintiv’s natural gas production:
- Total Natural Gas Production: Ovintiv’s total natural gas production averaged 1,648 million cubic feet per day (MMcf/d) during the first quarter of 2024.
- Natural Gas Pricing: The report mentions that the average realized price for natural gas during the first quarter was $2.21 per thousand cubic feet (Mcf). When including the impact of hedges, the average realized price for natural gas was $2.56 per Mcf.
- Guidance: Ovintiv issued guidance for natural gas production for the second quarter of 2024, forecasting production volumes to range between 1,600 to 1,650 MMcf/d.
These details provide an overview of Ovintiv’s natural gas production, pricing, and guidance for the first quarter of 2024 and beyond.
Oil
Ovintiv’s oil production:
- Total Oil Production: Ovintiv’s total oil production averaged 211 thousand barrels per day (Mbbls/d) of oil and condensate during the first quarter of 2024.
- Oil Pricing: The report mentions that the average realized price for oil and condensate during the first quarter was $74.62 per barrel. When including the impact of hedges, the average realized price for oil and condensate was $74.20 per barrel.
- Guidance: Ovintiv issued guidance for oil production for the second quarter of 2024, forecasting production volumes to range between 205 to 209 Mbbls/d.
These details provide an overview of Ovintiv’s oil production, pricing, and guidance for the first quarter of 2024 and beyond.
Budget
Ovintiv’s budget and financial planning:
- Capital Investment: Ovintiv plans to invest between $2.2 billion to $2.4 billion in capital expenditures for the full year of 2024. This capital investment is allocated towards various activities such as drilling, completions, facilities, and infrastructure development across its operating regions.
- Returns to Shareholders: Ovintiv remains committed to its capital allocation framework, aiming to return at least 50% of post base dividend Non-GAAP Free Cash Flow to shareholders through buybacks and/or variable dividends. In the first quarter of 2024, the company returned $328 million to shareholders through a combination of share buybacks totaling $248 million and base dividends of approximately $80 million.
- Dividend Declaration: Ovintiv’s Board declared a quarterly dividend of $0.30 per share of common stock, payable on June 28, 2024, to shareholders of record as of June 14, 2024.
- Balance Sheet Focus: Ovintiv maintains a focus on balance sheet strength, with approximately $3.0 billion in total liquidity as of March 31, 2024. The company reported Non-GAAP Debt to EBITDA of 1.3 times and Non-GAAP Debt to Adjusted EBITDA of 1.3 times. Additionally, Ovintiv maintains a long-term leverage target of 1.0 times Non-GAAP Debt to Adjusted EBITDA at mid-cycle prices, with an associated long-term total debt target of $4.0 billion.
These details offer insights into Ovintiv’s budgeting process, capital allocation strategy, shareholder returns, and focus on maintaining a strong balance sheet.
Conclusion
In conclusion, Ovintiv Inc.’s first quarter 2024 financial and operating results demonstrate strong performance across various aspects of its business:
- Financial Performance: The company achieved solid net earnings, cash flow from operating activities, and non-GAAP free cash flow, reflecting robust financial health and efficiency in operations.
- Production: Ovintiv’s production levels exceeded guidance, particularly in oil, condensate, and natural gas, indicating strong operational execution.
- Sustainability: The release of the 2023 Sustainability Report highlights Ovintiv’s commitment to environmental stewardship, social responsibility, and corporate governance, showcasing progress and achievements in these areas.
- Investment Plans: The company outlined its investment plans across key regions such as the Permian Basin, Montney, Uinta, and Anadarko, demonstrating strategic allocation of capital for future growth and development.
- Shareholder Returns: Ovintiv remains dedicated to returning value to its shareholders through dividends and buybacks, while maintaining a focus on balance sheet strength and financial discipline.
Overall, Ovintiv’s performance in the first quarter of 2024 reflects its resilience, efficiency, and commitment to sustainable growth, positioning the company for continued success in the future.
