CALGARY, AB, July 27, 2022 /PRNewswire/ - Crescent Point
Energy Corp. ("Crescent Point" or the "Company") (TSX:
CPG) (NYSE: CPG) is pleased to announce its operating and
financial results for the quarter ended June
30, 2022.
KEY HIGHLIGHTS
- Generated approximately $380
million of excess cash flow in second quarter, allowing for
increased returns to shareholders.
- Enhanced return of capital offering with an increased base
dividend and an updated framework, as previously announced.
- Achieved strong IP30 rate of 900 boe/d per well, comprised
primarily of liquids, on second fully operated pad in Kaybob
Duvernay.
- Established new targets to reduce scope 1 and 2 emissions and
freshwater use, as previously announced.
"Our second quarter results highlight our excess cash flow
generation, continued operational execution and commitment to
returning capital", said Craig
Bryksa, President and CEO of Crescent Point. "Upon attaining
our near-term debt target, we announced our updated framework,
which now targets to return the majority of our excess cash flow to
shareholders. We remain focused on creating long-term value through
a combination of returning capital while also enhancing the balance
sheet strength and sustainability of the business."
FINANCIAL HIGHLIGHTS
- Adjusted funds flow totaled $599.1
million during second quarter 2022, or $1.04 per share diluted, driven by a strong
operating netback of $76.57 per
boe.
- For the quarter ended June 30,
2022, development capital expenditures, which included
drilling and development, facilities and seismic costs, totaled
$196.9 million.
- Crescent Point's net debt as at June 30,
2022 was less than $1.5
billion, reflecting $307.3
million of net debt reduction in the quarter, including the
repayment of approximately $225
million of senior note maturities. Subsequent to the
quarter, the Company successfully closed the disposition of certain
non-core assets allowing Crescent Point to attain its near-term net
debt target of $1.3 billion, earlier
than anticipated.
- Crescent Point reported net income of $331.5 million, or $0.58 per share diluted, for second quarter
2022.
RETURN OF CAPITAL
HIGHLIGHTS
- During second quarter, the Company returned $108.0 million or approximately 30 percent of its
excess cash flow to shareholders through its base dividend and
share repurchases. Subsequent to the quarter, Crescent Point
released an updated framework which targets to return up to 50
percent of its discretionary excess cash flow, in addition to its
base dividend, through a combination of share repurchases and
special dividends.
- The Company repurchased approximately 7.2 million shares, for
cancellation, for $70.9 million
during second quarter and continues to remain active on its share
repurchase program. Crescent Point has approval to repurchase, for
cancellation, approximately 10 percent of its public float under
its existing normal course issuer bid ("NCIB"), which expires on
March 8, 2023.
- On July 6, 2022, the Company
announced an increase to its third quarter 2022 base dividend by
over 20 percent to $0.08/share or
$0.32/share annually. Crescent
Point's third quarter 2022 dividend will be paid on October 3, 2022 to shareholders of record on
September 15, 2022.
OPERATIONAL HIGHLIGHTS
- Average production for the quarter ended June 30, 2022 was 129,176 boe/d, comprised of
over 80 percent oil and liquids.
- The Company continues to demonstrate a strong track record of
operational execution in its Kaybob Duvernay play. Crescent Point
recently brought on stream its second fully operated multi-well pad
with an average 30-day initial production ("IP30") rate of over 900
boe/d per well (71% condensate, 8% NGL and 21% shale gas), which is
expected to payout in approximately six months from the initial
on-stream date at current commodity prices. Crescent Point's
ongoing execution also includes a further reduction in drilling
days on its most recent pad, which averaged approximately 14 days
per well.
- During second quarter, the Company's operations in North Dakota were temporarily impacted by a
severe storm that affected electricity distribution. Operations
were fully restored during the quarter, as previously
announced.
- The Company continues to roll out its Operations Technology
("OT") platform, which Crescent Point has used to deliver operating
cost efficiencies and environmental and safety benefits. Through
the OT platform, the Company has optimized workflows and
implemented remote well monitoring and technology in its field
operations. Crescent Point is currently implementing the OT
platform in its North Dakota and
Kaybob Duvernay assets, which will complete the company-wide
integration of this technology platform.
- Subsequent to the quarter, Crescent Point released its annual
sustainability report providing insight into its Environmental,
Social and Governance ("ESG") approach and execution. The 2022
Sustainability Report featured the introduction of a target to
further reduce the Company's scope 1 and 2 emissions intensity by
38 percent by 2030, relative to Crescent Point's 2020 baseline. The
Company also announced two new water targets to build upon its
existing strong water management performance, including a 50
percent reduction in surface freshwater use in southeast
Saskatchewan completions by 2025.
Crescent Point's ESG practices continue to be integrated into all
aspects of its business to enhance long-term sustainability.
__________________
|
All financial figures
are approximate and in Canadian dollars unless otherwise noted.
This press release contains forward-looking information and
references to specified financial measures. Excess cash flow,
adjusted funds flow, adjusted net earnings from operations,
adjusted funds flow from operations per share diluted,
discretionary excess cash flow, net debt and operating netback are
specified financial measures - refer to the Specified Financial
Measures section in this press release for further information.
Significant related assumptions and risk factors, and
reconciliations are described under the Specified Financial
Measures and Forward-Looking Statements sections of this press
release. Further information breaking down the production
information contained in this press release by product type can be
found in the Product Type Production Information
section.
|
OUTLOOK
Second quarter 2022 results demonstrated continued capital
discipline and operational execution, resulting in significant
excess cash flow generation.
Crescent Point recently updated its 2022 annual average
production guidance to 130,000 to 134,000 boe/d, reflecting the
impact of certain non-core asset dispositions, with development
capital expenditures unchanged at $875 to $900
million. The Company has controlled a significant portion of
its capital costs to-date through its supply chain management while
also mitigating potential cost increases through realized
efficiencies. Crescent Point continues to monitor its cost
assumptions in light of the current inflationary environment.
Excess cash flow generation is now expected to be approximately
$1.4 billion in 2022, assuming
US$100/bbl WTI for the remainder of
2022. The Company's excess cash flow generation continues to be
bolstered by its high netback asset base and benefit from its
significant tax pools.
Crescent Point remains disciplined in its capital allocation and
continues to create value on a per share basis, including its
recently announced framework that targets to return up to 50
percent of its discretionary excess cash flow to its
shareholders.
CONFERENCE CALL DETAILS
Crescent Point management will hold a conference call on
Wednesday, July 27, 2022 at
10:00 a.m. MT (12:00 p.m. ET) to discuss the Company's results
and outlook. A slide deck will accompany the conference call and
can be found on Crescent Point's website.
Participants can listen to this event online. Alternatively, the
conference call can be accessed by dialing 1‑888‑390‑0605.
The webcast will be archived for replay and can be accessed
online at Crescent Point's conference calls and webcasts page. The
replay will be available approximately one hour following
completion of the call.
Shareholders and investors can also find the Company's most
recent investor presentation on Crescent Point's website.
2022 GUIDANCE
The Company's guidance for 2022 is as follows:
Total Annual Average
Production (boe/d) (1)
|
130,000 -
134,000
|
|
|
Capital
Expenditures
|
|
Development capital
expenditures ($ millions)
|
$875 - $900
|
Capitalized G&A ($
millions)
|
$40
|
Total ($ millions)
(2)
|
$915 - $940
|
|
|
Other Information
for 2022 Guidance
|
|
Reclamation activities
($ millions) (3)
|
$20
|
Capital lease payments
($ millions)
|
$20
|
Annual operating
expenses ($/boe)
|
$13.75 -
$14.25
|
Royalties
|
13.5% -
14.0%
|
|
|
1)
|
Total annual average
production (boe/d) is comprised of approximately 80% Oil,
Condensate & NGLs and 20% Natural Gas
|
2)
|
Land expenditures and
net property acquisitions and dispositions are not included.
Development capital expenditures spend is allocated on an
approximate basis as follows: 85% drilling & development and
15% facilities & seismic
|
3)
|
Reflects Crescent
Point's portion of its expected total budget
|
RETURN OF CAPITAL
OUTLOOK
Base
Dividend
|
|
Current quarterly base
dividend per share
|
$0.08
|
Additional Return of
Capital
|
|
% of discretionary
excess cash flow (1)(2)
|
50 %
|
|
|
1)
|
Discretionary excess
cash flow is calculated as excess cash flow less base
dividends
|
2)
|
Additional return of
capital % to begin in third quarter 2022. This % is part of a
framework that targets to return up to 50% of discretionary excess
cash flow to shareholders
|
|
|
The Company's unaudited financial statements and management's
discussion and analysis for the quarter ended June 30, 2022, will be available on the System
for Electronic Document Analysis and Retrieval ("SEDAR") at
www.sedar.com, on EDGAR at www.sec.gov/edgar and on Crescent
Point's website at www.crescentpointenergy.com.
FINANCIAL AND OPERATING
HIGHLIGHTS
|
Three months ended June
30
|
Six months ended June
30
|
(Cdn$ millions except
per share and per boe amounts)
|
2022
|
2021
|
2022
|
2021
|
Financial
|
|
|
|
|
Cash flow from
operating activities
|
529.6
|
285.5
|
955.7
|
589.2
|
Adjusted funds flow
from operations (1)
|
599.1
|
387.8
|
1,133.1
|
650.5
|
Per share (1)
(2)
|
1.04
|
0.66
|
1.96
|
1.16
|
Net income
|
331.5
|
2,143.3
|
1,515.1
|
2,165.0
|
Per share
(2)
|
0.58
|
3.65
|
2.62
|
3.85
|
Adjusted net earnings
from operations (1)
|
272.1
|
117.6
|
513.0
|
212.7
|
Per share (1)
(2)
|
0.47
|
0.20
|
0.89
|
0.38
|
Dividends
declared
|
37.1
|
1.5
|
36.9
|
2.8
|
Per share
(2)
|
0.0650
|
0.0025
|
0.0650
|
0.0050
|
Net debt
(1)
|
1,467.9
|
2,324.2
|
1,467.9
|
2,324.2
|
Net debt to adjusted
funds flow from operations (1) (3)
|
0.7
|
2.1
|
0.7
|
2.1
|
Weighted average shares
outstanding
|
|
|
|
|
Basic
|
571.4
|
581.7
|
574.2
|
556.2
|
Diluted
|
575.9
|
587.8
|
579.2
|
562.1
|
Operating
|
|
|
|
|
Average daily
production
|
|
|
|
|
Crude oil and
condensate (bbls/d)
|
91,250
|
107,444
|
92,106
|
101,394
|
NGLs
(bbls/d)
|
16,139
|
18,608
|
16,586
|
15,978
|
Natural gas
(mcf/d)
|
130,724
|
135,531
|
133,679
|
100,327
|
Total
(boe/d)
|
129,176
|
148,641
|
130,972
|
134,093
|
Average selling prices
(4)
|
|
|
|
|
Crude oil and
condensate ($/bbl)
|
134.50
|
75.88
|
124.04
|
70.88
|
NGLs
($/bbl)
|
50.57
|
36.78
|
49.17
|
37.16
|
Natural gas
($/mcf)
|
8.02
|
3.64
|
6.77
|
3.92
|
Total
($/boe)
|
109.44
|
62.78
|
100.36
|
60.95
|
Netback
($/boe)
|
|
|
|
|
Oil and gas
sales
|
109.44
|
62.78
|
100.36
|
60.95
|
Royalties
|
(14.69)
|
(7.90)
|
(13.46)
|
(7.93)
|
Operating
expenses
|
(15.36)
|
(12.63)
|
(14.73)
|
(12.91)
|
Transportation
expenses
|
(2.82)
|
(2.38)
|
(2.78)
|
(2.36)
|
Operating netback
(1)
|
76.57
|
39.87
|
69.39
|
37.75
|
Realized loss on
commodity derivatives
|
(22.17)
|
(7.22)
|
(17.97)
|
(6.48)
|
Other
(5)
|
(3.43)
|
(3.98)
|
(3.62)
|
(4.46)
|
Adjusted funds flow
from operations netback (1)
|
50.97
|
28.67
|
47.80
|
26.81
|
Capital
Expenditures
|
|
|
|
|
Capital acquisitions
(6)
|
0.3
|
936.3
|
1.2
|
936.3
|
Capital dispositions
(6)
|
(37.8)
|
(87.9)
|
(40.7)
|
(95.1)
|
Development capital
expenditures
|
|
|
|
|
Drilling and
development
|
182.8
|
57.9
|
371.0
|
163.5
|
Facilities and
seismic
|
14.1
|
30.5
|
30.2
|
44.1
|
Total
|
196.9
|
88.4
|
401.2
|
207.6
|
Land
expenditures
|
3.6
|
2.0
|
9.3
|
2.9
|
|
|
(1)
|
Specified financial
measure that does not have any standardized meaning prescribed by
IFRS and, therefore, may not be comparable with the calculation of
similar measures presented by other entities. Refer to the
Specified Financial Measures section for further
information.
|
(2)
|
The per share amounts
(with the exception of dividends per share) are the per share –
diluted amounts.
|
(3)
|
Net debt to adjusted
funds flow from operations is calculated as the period end net debt
divided by the sum of adjusted funds flow from operations for the
trailing four quarters.
|
(4)
|
The average selling
prices reported are before realized derivatives and
transportation.
|
(5)
|
Other includes net
purchased products, general and administrative expenses, interest
on long-term debt, foreign exchange, cash-settled share-based
compensation and certain cash items and excludes transaction costs,
foreign exchange on US dollar long-term debt and certain non-cash
items.
|
(6)
|
Capital acquisitions
and dispositions represent total consideration for the
transactions, including long-term debt and working capital assumed,
and exclude transaction costs.
|
Specified Financial
Measures
Throughout this press release, the Company uses the terms
"adjusted funds flow" (equivalent to "adjusted funds flow from
operations"), "adjusted funds flow from operations per share -
diluted", "adjusted net earnings from operations", "adjusted net
earnings from operations per share - diluted", "excess cash flow",
"discretionary excess cash flow", "net debt", "net debt to adjusted
funds flow" (equivalent to "net debt to adjusted funds flow from
operations"), "total operating netback", "total netback",
"operating netback", "netback", "adjusted funds flow from
operations netback" and "adjusted working capital deficiency".
These terms do not have any standardized meaning as prescribed by
IFRS and, therefore, may not be comparable with the calculation of
similar measures presented by other issuers. For information on the
composition of these measures and how the Company uses these
measures, refer to the Specified Financial Measures section of the
Company's MD&A for the period ended June
30, 2022, which section is incorporated herein by reference,
and available on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov/edgar.
Adjusted funds flow from operations netback is a non-GAAP
financial ratio and is calculated as adjusted funds flow from
operations divided by total production. Adjusted funds flow from
operations netback is a common metric used in the oil and gas
industry and is used to measure operating results on a per boe
basis.
The following table reconciles oil and gas sales to total
operating netback, total netback and adjusted funds flow from
operations netback:
|
Three months ended June
30
|
|
Six months ended June
30
|
|
($ millions)
|
2022
|
|
2021
|
|
% Change
|
|
2022
|
|
2021
|
|
% Change
|
|
Oil and gas
sales
|
1,286.5
|
|
849.2
|
|
51
|
|
2,379.2
|
|
1,479.4
|
|
61
|
|
Royalties
|
(172.7)
|
|
(106.8)
|
|
62
|
|
(319.1)
|
|
(192.5)
|
|
66
|
|
Operating
expenses
|
(180.5)
|
|
(170.8)
|
|
6
|
|
(349.2)
|
|
(313.4)
|
|
11
|
|
Transportation
expenses
|
(33.2)
|
|
(32.2)
|
|
3
|
|
(65.8)
|
|
(57.3)
|
|
15
|
|
Total operating
netback
|
900.1
|
|
539.4
|
|
67
|
|
1,645.1
|
|
916.2
|
|
80
|
|
Realized loss on
commodity derivatives
|
(260.6)
|
|
(97.7)
|
|
167
|
|
(426.0)
|
|
(157.4)
|
|
171
|
|
Total
netback
|
639.5
|
|
441.7
|
|
45
|
|
1,219.1
|
|
758.8
|
|
61
|
|
Other
(1)
|
(40.4)
|
|
(53.9)
|
|
(25)
|
|
(86.0)
|
|
(108.3)
|
|
(21)
|
|
Total adjusted funds
flow from operations netback
|
599.1
|
|
387.8
|
|
54
|
|
1,133.1
|
|
650.5
|
|
74
|
|
|
|
(1)
|
Other includes net
purchased products, general and administrative expenses, interest
on long-term debt, foreign exchange, cash-settled share-based
compensation and certain cash items and excludes transaction costs,
foreign exchange on US dollar long-term debt and certain non-cash
items.
|
The following table reconciles cash flow from operating
activities to adjusted funds flow from operations, excess cash flow
and discretionary excess cash flow:
|
Three months ended June
30
|
|
Six months ended June
30
|
|
($ millions)
|
2022
|
|
2021
(1)
|
|
% Change
|
|
2022
|
|
2021
(1)
|
|
% Change
|
|
Cash flow from
operating activities
|
529.6
|
|
285.5
|
|
85
|
|
955.7
|
|
589.2
|
|
62
|
|
Changes in non-cash
working capital
|
64.7
|
|
88.4
|
|
(27)
|
|
166.1
|
|
41.2
|
|
303
|
|
Transaction
costs
|
0.3
|
|
11.7
|
|
(97)
|
|
0.4
|
|
11.8
|
|
(97)
|
|
Decommissioning
expenditures (2)
|
4.5
|
|
2.2
|
|
105
|
|
10.9
|
|
8.3
|
|
31
|
|
Adjusted funds flow
from operations
|
599.1
|
|
387.8
|
|
54
|
|
1,133.1
|
|
650.5
|
|
74
|
|
Capital
expenditures
|
(211.5)
|
|
(100.7)
|
|
110
|
|
(438.3)
|
|
(235.1)
|
|
86
|
|
Payments on lease
liability
|
(5.1)
|
|
(5.1)
|
|
—
|
|
(10.2)
|
|
(10.2)
|
|
—
|
|
Decommissioning
expenditures
|
(4.5)
|
|
(2.2)
|
|
105
|
|
(10.9)
|
|
(8.3)
|
|
31
|
|
Other items
(3)
|
(0.2)
|
|
(5.2)
|
|
(96)
|
|
(6.6)
|
|
7.6
|
|
(187)
|
|
Excess cash
flow
|
377.8
|
|
274.6
|
|
38
|
|
667.1
|
|
404.5
|
|
65
|
|
Dividends
|
(37.1)
|
|
(1.5)
|
|
2,373
|
|
(36.9)
|
|
(2.8)
|
|
1,218
|
|
Discretionary excess
cash flow
|
340.7
|
|
273.1
|
|
25
|
|
630.2
|
|
401.7
|
|
57
|
|
|
|
(1)
|
Comparative period
revised to reflect current year presentation.
|
(2)
|
Excludes amounts
received from government subsidy programs.
|
(3)
|
Other items include,
but are not limited to, unrealized gains and losses on equity
derivative contracts and transaction costs. Other items exclude net
acquisitions and dispositions.
|
Adjusted funds flow from operations per share - diluted is a
supplementary financial measure and is calculated as adjusted funds
flow from operations divided by the number of weighted average
diluted shares outstanding. It is used as a key measure to assess
the ability of the Company to finance dividends, operating
activities, capital expenditures and debt repayments.
The following table reconciles adjusted working capital
deficiency:
($ millions)
|
June 30,
2022
|
|
December 31,
2021
|
|
% Change
|
|
Accounts payable and
accrued liabilities
|
525.9
|
|
450.7
|
|
17
|
|
Dividends
payable
|
37.0
|
|
43.5
|
|
(15)
|
|
Long-term compensation
liability (1)
|
41.2
|
|
42.6
|
|
(3)
|
|
Cash
|
(15.9)
|
|
(13.5)
|
|
18
|
|
Accounts
receivable
|
(532.8)
|
|
(314.3)
|
|
70
|
|
Prepaids and
deposits
|
(14.5)
|
|
(7.4)
|
|
96
|
|
Adjusted working
capital deficiency
|
40.9
|
|
201.6
|
|
(80)
|
|
|
|
(1)
|
Includes current
portion of long-term compensation liability and is net of equity
derivative contracts.
|
The following table reconciles long-term debt to net debt:
($ millions)
|
June 30,
2022
|
|
December 31,
2021
|
|
% Change
|
|
Long-term debt
(1)
|
1,560.7
|
|
1,970.2
|
|
(21)
|
|
Adjusted working
capital deficiency
|
40.9
|
|
201.6
|
|
(80)
|
|
Unrealized foreign
exchange on translation of US dollar long-term debt
|
(133.7)
|
|
(166.8)
|
|
(20)
|
|
Net debt
|
1,467.9
|
|
2,005.0
|
|
(27)
|
|
|
|
(1)
|
Includes current
portion of long-term debt.
|
The following table reconciles net income to adjusted net
earnings from operations:
|
Three months ended June
30
|
|
Six months ended June
30
|
|
($ millions)
|
2022
|
|
2021
|
|
% Change
|
|
2022
|
|
2021
|
|
% Change
|
|
Net income
|
331.5
|
|
2,143.3
|
|
(85)
|
|
1,515.1
|
|
2,165.0
|
|
(30)
|
|
Amortization of E&E
undeveloped land
|
4.6
|
|
13.3
|
|
(65)
|
|
11.2
|
|
27.1
|
|
(59)
|
|
Impairment
reversal
|
—
|
|
(2,514.4)
|
|
(100)
|
|
(1,484.9)
|
|
(2,514.4)
|
|
(41)
|
|
Unrealized derivative
(gains) losses
|
(81.0)
|
|
143.6
|
|
(156)
|
|
232.2
|
|
225.3
|
|
3
|
|
Unrealized foreign
exchange gain on translation of hedged US dollar long-term
debt
|
(13.8)
|
|
(37.9)
|
|
(64)
|
|
(33.1)
|
|
(49.8)
|
|
(34)
|
|
Unrealized gain on
long-term investments
|
—
|
|
(3.9)
|
|
(100)
|
|
—
|
|
(6.1)
|
|
(100)
|
|
Net (gain) loss on
capital dispositions
|
0.1
|
|
(73.8)
|
|
(100)
|
|
(2.8)
|
|
(56.5)
|
|
(95)
|
|
Deferred tax
adjustments
|
30.7
|
|
447.4
|
|
(93)
|
|
275.3
|
|
422.1
|
|
(35)
|
|
Adjusted net earnings
from operations
|
272.1
|
|
117.6
|
|
131
|
|
513.0
|
|
212.7
|
|
141
|
|
Excess cash flow and discretionary excess cash flow forecasted
for 2022 are forward-looking non-GAAP measures and are calculated
consistently with the measures disclosed in the Company's MD&A.
Refer to the Specified Financial Measures section of the Company's
MD&A for the period ended June 30,
2022.
Management believes the presentation of the specified financial
measures above provide useful information to investors and
shareholders as the measures provide increased transparency and the
ability to better analyze performance against prior periods on a
comparable basis.
Forward-Looking
Statements
Any "financial outlook" or "future oriented financial
information" in this press release, as defined by applicable
securities legislation has been approved by management of Crescent
Point. Such financial outlook or future oriented financial
information is provided for the purpose of providing information
about management's current expectations and plans relating to the
future. Readers are cautioned that reliance on such information may
not be appropriate for other purposes.
Certain statements contained in this press release constitute
"forward-looking statements" within the meaning of section 27A of
the Securities Act of 1933 and section 21E of the Securities
Exchange Act of 1934 and "forward-looking information" for the
purposes of Canadian securities regulation (collectively,
"forward-looking statements"). The Company has tried to identify
such forward-looking statements by use of such words as "could",
"should", "can", "anticipate", "expect", "believe", "will", "may",
"intend", "projected", "sustain", "continues", "strategy",
"potential", "projects", "grow", "take advantage", "estimate",
"well-positioned" and other similar expressions, but these words
are not the exclusive means of identifying such statements.
In particular, this press release contains forward-looking
statements pertaining, among other things, to the following: a
commitment to returning capital; a return of capital framework that
targets the return of the majority of excess cash flow to
shareholders and targets to return up to 50 percent of
discretionary excess cash flow, in addition to base dividend,
through a combination of share repurchases and special dividends;
creating long-term value through a combination of returning capital
while also enhancing the balance sheet strength and sustainability
of the business; a target to further reduce the Company's scope 1
and 2 emissions intensity by 38 percent by 2030, relative to
Crescent Point's 2020 baseline; two new water targets, including a
50 percent reduction in surface freshwater use in southeast
Saskatchewan completions by 2025;
ESG practices integrated into all aspects of the business,
enhancing long-term sustainability; 2022 annual average production
guidance of 130,000 to 134,000 boe/d; 2022 development capital
expenditures of $875 to $900 million; mitigating potential cost increases
through realized efficiencies; 2022 excess cash flow generation
expected to be approximately $1.4
billion in 2022, assuming US$100/bbl WTI for the remainder of 2022; high
netback asset base and significant tax pools; Crescent Point's
annual guidance for 2022, including, but not limited to capitalized
G&A of $40 million, reclamation
activities of $20 million, capital
lease payments of $20 million, annual
operating expenses of $13.75 -
$ 14.25/boe, and royalties of 13.5% -
14.0%; and the return of capital outlook.
Statements relating to "reserves" are also deemed to be
forward-looking statements, as they involve the implied assessment,
based on certain estimates and assumptions, that the reserves
described exist in the quantities predicted or estimated and that
the reserves can be profitably produced in the future. Actual
reserve values may be greater than or less than the estimates
provided herein. Unless otherwise noted, reserves referenced herein
are given as at December 31, 2021.
Also, estimates of reserves and future net revenue for individual
properties may not reflect the same confidence level as estimates
and future net revenue for all properties due to the effect of
aggregation. All required reserve information for the Company is
contained in its Annual Information Form for the year ended
December 31, 2021 which is accessible
at www.sedar.com.
With respect to disclosure contained herein regarding resources
other than reserves, there is uncertainty that it will be
commercially viable to produce any portion of the resources and
there is significant uncertainty regarding the ultimate
recoverability of such resources.
All forward-looking statements are based on Crescent Point's
beliefs and assumptions based on information available at the time
the assumption was made. Crescent Point believes that the
expectations reflected in these forward-looking statements are
reasonable but no assurance can be given that these expectations
will prove to be correct and such forward-looking statements
included in this report should not be unduly relied upon. By their
nature, such forward-looking statements are subject to a number of
risks, uncertainties and assumptions, which could cause actual
results or other expectations to differ materially from those
anticipated, expressed or implied by such statements, including
those material risks discussed in the Company's Annual Information
Form for the year ended December 31,
2021 under "Risk Factors" and our Management's Discussion
and Analysis for the year ended December 31,
2021, and for the quarter ended June
30, 2022, under the headings "Risk Factors" and
"Forward-Looking Information". The material assumptions are
disclosed in the Management's Discussion and Analysis for the three
months ended June 30, 2022, under the
headings "Overview", "Commodity Derivatives", "Liquidity and
Capital Resources","Guidance", "Royalties" and "Operating
Expenses". In addition, risk factors include: : financial risk of
marketing reserves at an acceptable price given market conditions;
volatility in market prices for oil and natural gas, decisions or
actions of OPEC and non-OPEC countries in respect of supplies of
oil and gas; delays in business operations or delivery of services
due to pipeline restrictions, rail blockades, outbreaks, blowouts
and business closures and social distancing measures mandated by
public health authorities in response to COVID-19, including
current and new variants thereof; the risk of carrying out
operations with minimal environmental impact; industry conditions
including changes in laws and regulations including the adoption of
new environmental laws and regulations and changes in how they are
interpreted and enforced; uncertainties associated with estimating
oil and natural gas reserves; risks and uncertainties related to
oil and gas interests and operations on Indigenous lands; economic
risk of finding and producing reserves at a reasonable cost;
uncertainties associated with partner plans and approvals;
operational matters related to non-operated properties; increased
competition for, among other things, capital, acquisitions of
reserves and undeveloped lands; competition for and availability of
qualified personnel or management; incorrect assessments of the
value and likelihood of acquisitions and dispositions, and
exploration and development programs; unexpected geological,
technical, drilling, construction, processing and transportation
problems; the impact of severe weather events; availability of
insurance; fluctuations in foreign exchange and interest rates;
stock market volatility; general economic, market and business
conditions, including uncertainty in the demand for oil and gas and
economic activity in general as a result of the COVID-19 pandemic;
changes in interest rates and inflation; uncertainties associated
with regulatory approvals; geopolitical conflicts, including the
Russian invasion of Ukraine;
uncertainty of government policy changes; the impact of the
implementation of the Canada-United States-Mexico Agreement;
uncertainty regarding the benefits and costs of dispositions;
failure to complete acquisitions and dispositions; uncertainties
associated with credit facilities and counterparty credit risk;
changes in income tax laws, tax laws, crown royalty rates and
incentive programs relating to the oil and gas industry; the
wide-ranging impacts of the COVID-19 pandemic, including on demand,
health and supply chain; and other factors, many of which are
outside the control of the Company. The impact of any one risk,
uncertainty or factor on a particular forward-looking statement is
not determinable with certainty as these are interdependent and
Crescent Point's future course of action depends on management's
assessment of all information available at the relevant time.
Additional information on these and other factors that could
affect Crescent Point's operations or financial results are
included in Crescent Point's reports on file with Canadian and U.S.
securities regulatory authorities. Readers are cautioned not to
place undue reliance on this forward-looking information, which is
given as of the date it is expressed herein or otherwise. Crescent
Point undertakes no obligation to update publicly or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, unless required to do so pursuant to
applicable law. All subsequent forward-looking statements, whether
written or oral, attributable to Crescent Point or persons acting
on the Company's behalf are expressly qualified in their entirety
by these cautionary statements.
Product Type Production
Information
The Company's aggregate average production for the three and six
months ended June 30, 2022 and
June 30, 2021 and the references to
"natural gas" and "crude oil", reported in this Press Release
consist of the following product types, as defined in NI 51-101 and
using a conversion ratio of 6 mcf : 1 bbl where applicable:
|
Three months ended June
30
|
Six months ended June
30
|
|
2022
|
2021
|
2022
|
2021
|
Light & Medium
Crude Oil (bbl/d)
|
15,752
|
20,181
|
15,559
|
20,482
|
Heavy Crude Oil
(bbl/d)
|
4,103
|
4,269
|
4,069
|
4,193
|
Tight Oil
(bbl/d)
|
53,521
|
65,595
|
54,672
|
67,972
|
Total Crude Oil
(bbl/d)
|
73,376
|
90,045
|
74,300
|
92,647
|
|
|
|
|
|
NGLs (bbl/d)
|
34,013
|
36,007
|
34,392
|
24,725
|
|
|
|
|
|
Shale Gas
(mcf/d)
|
119,924
|
125,830
|
123,254
|
89,618
|
Conventional Natural
Gas (mcf/d)
|
10,800
|
9,701
|
10,425
|
10,709
|
Total Natural Gas
(mcf/d)
|
130,724
|
135,531
|
133,679
|
100,327
|
|
|
|
|
|
Total
(boe/d)
|
129,176
|
148,641
|
130,972
|
134,093
|
Barrels of oil equivalent ("boe") may be misleading,
particularly if used in isolation. A boe conversion ratio of 6 mcf
: 1 bbl is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead. Given that the value ratio based
on the current price of crude oil as compared to natural gas is
significantly different from the energy equivalency of oil,
utilizing a conversion on a 6:1 basis may be misleading as an
indication of value.
This press release contains metrics commonly used in the oil and
natural gas industry, including "netback" and "payout". These terms
do not have a standardized meaning and may not be comparable to
similar measures presented by other companies and, therefore,
should not be used to make comparisons. Readers are cautioned as to
the reliability of oil and gas metrics used in this press release.
Management uses these oil and gas metrics for its own performance
measurements and to provide investors with measures to compare the
Company's performance over time; however, such measures are not
reliable indicators of the Company's future performance, which may
not compare to the Company's performance in previous periods, and
therefore should not be unduly relied upon. Netback is used by
management to measure operating results on a per boe basis to
better analyze performance against prior periods on a comparable
basis. Payout is the point at which all costs associated with
leasing, exploring, drilling and operating have been recovered from
the production of a well. It is an indication of profitability. In
this press release payout is based upon the booked 2P type-well
data prepared by McDaniel & Associates Consultants Ltd. having
an effective date of December 31,
2021.
Initial production is for a limited time frame only (30 days)
and may not be indicative of future performance.
NI 51-101 includes condensate within the natural gas liquids
(NGLs) product type. The Company has disclosed condensate as
combined with crude oil and/or separately from other natural gas
liquids in this press release since the price of condensate as
compared to other natural gas liquids is currently significantly
higher and the Company believes that this crude oil and condensate
presentation provides a more accurate description of its operations
and results.
FOR MORE INFORMATION ON CRESCENT POINT ENERGY, PLEASE
CONTACT:
Shant Madian, Vice
President, Capital Markets, or
Sarfraz
Somani, Manager, Investor Relations
Telephone: (403) 693-0020 Toll-free (US and Canada): 888-693-0020 Fax: (403)
693-0070
Address: Crescent Point Energy Corp. Suite 2000, 585 - 8th
Avenue S.W. Calgary AB T2P 1G1
www.crescentpointenergy.com
Crescent Point shares are traded on the Toronto Stock Exchange
and New York Stock Exchange under the symbol CPG.
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content:https://www.prnewswire.com/news-releases/crescent-point-announces-q2-2022-results-301593909.html
SOURCE Crescent Point Energy Corp.