(TSX:BNP)
CALGARY, May 2, 2019 /CNW/ – Bonavista Energy Corporation (“Bonavista”) is pleased to report to shareholders its financial and operating results for the three months ended March 31, 2019. The financial statements and notes, as well as management’s discussion and analysis, are available on the System for Electronic Document Analysis and Retrieval (“SEDAR”) at http://www.sedar.com and on Bonavista’s website at www.bonavistaenergy.com.
MESSAGE TO SHAREHOLDERS
Through the first three-months of 2019, we directed a moderate 75% of our adjusted funds flow to our capital program as we pragmatically navigate the current and future commodity price discounts created by regulatory uncertainty and inadequate pipeline capacity in the Canadian energy sector.
Capital expenditures, net of acquisition and divestiture activity in the quarter were $43.8 million. 70% of our exploration and development (“E&D”) spending was allocated to drilling ten gross (9.6 net) wells, primarily in our West Central core area. The remaining 30% was allocated to support capital, the majority of which was directed to land and infrastructure spending.
Additional Duvernay mineral rights were acquired in the quarter, firmly establishing our presence in this emerging liquids-rich resource play with access now to approximately 190 prospective sections. Currently, we plan to drill our first Duvernay horizontal well in the second half of this year.
Infrastructure projects initiated in the first quarter will lead to total spend of approximately $15 million on such projects in the first half of 2019, most of which are concentrated in our West Central core area. This will allow us to redirect current and future production in the Willesden Green area to a lower cost, efficient processing solution.
Production for the quarter was recorded modestly ahead of budget despite severe cold temperatures in the later-half of the first quarter leading to unanticipated production downtime. Natural gas liquids (“NGL”) and oil production account for 30% of the total, marking a four percent increase in our oil and liquids weighting over the prior year period.
Natural gas prices were buoyed in the first quarter by the extended period of extreme cold in the province, providing us an opportunity to hedge an incremental 28 mmcf per day for the summer period of 2019 at an average price of $1.31 per mcf. When combined with other diversification initiatives, we have less than 20% of our forecasted natural gas production exposed to spot AECO pricing over the summer period of 2019.
2019 FIRST QUARTER FINANCIAL AND OPERATING HIGHLIGHTS
Three Months Ended |
||||||||||||||
December 31, 2018 |
March 31, 2019 |
March 31, 2018 |
% Change |
|||||||||||
Financial |
||||||||||||||
($ thousands, except per share) |
||||||||||||||
Production revenues |
124,302 |
120,636 |
138,388 |
(13) |
% |
|||||||||
Net income (loss) |
81,227 |
(40,135) |
(2,037) |
1,870 |
% |
|||||||||
Per share(1) |
0.31 |
(0.15) |
(0.01) |
1,400 |
% |
|||||||||
Cash flow from operating activities |
77,581 |
54,485 |
76,048 |
(28) |
% |
|||||||||
Per share(1) |
0.30 |
0.21 |
0.30 |
(30) |
% |
|||||||||
Adjusted funds flow(2) |
61,075 |
58,181 |
69,128 |
(16) |
% |
|||||||||
Per share(1) |
0.23 |
0.22 |
0.27 |
(19) |
% |
|||||||||
Dividends declared |
2,555 |
2,558 |
2,523 |
1 |
% |
|||||||||
Per share |
0.01 |
0.01 |
0.01 |
— |
% |
|||||||||
Total assets |
2,923,709 |
2,867,965 |
2,933,854 |
(2) |
% |
|||||||||
Shareholders’ equity |
1,552,184 |
1,512,870 |
1,539,073 |
(2) |
% |
|||||||||
Long-term debt |
801,625 |
781,168 |
802,394 |
(3) |
% |
|||||||||
Net debt(2) |
835,905 |
811,440 |
839,619 |
(3) |
% |
|||||||||
Capital expenditures: |
||||||||||||||
Exploration and development |
45,172 |
49,023 |
43,855 |
12 |
% |
|||||||||
Acquisitions, net of dispositions(3) |
11,037 |
(5,378) |
97 |
(5,644) |
% |
|||||||||
Corporate |
221 |
119 |
145 |
(18) |
% |
|||||||||
Weighted average outstanding equivalent shares: (thousands)(1) |
||||||||||||||
Basic |
260,047 |
260,305 |
257,030 |
1 |
% |
|||||||||
Diluted |
267,135 |
272,236 |
267,120 |
2 |
% |
|||||||||
Operating |
||||||||||||||
(boe conversion – 6:1 basis) |
||||||||||||||
Production: |
||||||||||||||
Natural gas (mmcf/day) |
281 |
282 |
322 |
(12) |
% |
|||||||||
Natural gas liquids (bbls/day) |
19,131 |
17,945 |
16,480 |
9 |
% |
|||||||||
Oil (bbls/day)(4) |
2,108 |
1,988 |
2,327 |
(15) |
% |
|||||||||
Total oil equivalent (boe/day) |
68,011 |
66,937 |
72,417 |
(8) |
% |
|||||||||
Product prices:(5) |
||||||||||||||
Natural gas ($/mcf) |
2.91 |
2.61 |
2.85 |
(8) |
% |
|||||||||
Natural gas liquids ($/bbl) |
24.99 |
28.95 |
31.68 |
(9) |
% |
|||||||||
Oil ($/bbl)(4) |
28.47 |
60.21 |
59.81 |
1 |
% |
|||||||||
Total oil equivalent ($/boe) |
19.91 |
20.54 |
21.79 |
(6) |
% |
|||||||||
Operating expenses ($/boe) |
5.66 |
5.85 |
5.64 |
4 |
% |
|||||||||
Transportation expenses ($/boe) |
1.37 |
1.44 |
1.23 |
17 |
% |
|||||||||
General and administrative expenses ($/boe) |
0.87 |
0.84 |
1.09 |
(23) |
% |
|||||||||
Cash costs ($/boe)(2) |
9.27 |
9.55 |
9.38 |
2 |
% |
|||||||||
Operating netback ($/boe)(2) |
11.99 |
11.92 |
13.11 |
(9) |
% |
NOTES: |
|
(1) |
Basic per share calculations include exchangeable shares which are convertible into common shares on certain terms and conditions. |
(2) |
Non-GAAP measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. Reference should be |
(3) |
Expenditures on property acquisitions, net of property dispositions. |
(4)</span |