CALGARY, June 20, 2019 /CNW/ – (ARX – TSX) ARC Resources Ltd. (“ARC” or the “Company”) announced that its board of directors has approved a reduction to the Company’s 2019 capital expenditure program, from $775 million to $700 million. 2020 capital expenditures are expected to be in the range of $550 million to $625 million. “ARC’s reduced capital investment levels are consistent with our long-held principles of stewarding low debt, sustainable dividends, and investing capital when it is profitable to do so. At this time, we feel it is appropriate to slow down the pace of development due to reduced commodity prices,” said Myron Stadnyk, ARC’s President and Chief Executive Officer. ARC’s 2019 production guidance of 135,000 to 142,000 boe per day remains unchanged despite the reduction in capital expenditures. The reduction to the 2019 capital program relates to the deferral of the Attachie West Phase I gas processing and liquids-handling facility. Expectations for 2020 production levels remain unchanged as ARC proceeds with the construction of the Dawson Phase IV gas processing and liquids-handling facility.
ARC continues to estimate annual sustaining capital (1) requirements of approximately $400 million. With the announced capital expenditure levels planned for 2019 and 2020, construction of the Dawson Phase IV facility is on schedule with the anticipated on-stream date remaining in the second quarter of 2020. The Attachie West Phase I project will be deferred by at least one year from the originally planned on-stream date of mid-year 2021. ARC will continue to pilot its Attachie operations through the Company’s existing infrastructure.
ARC is committed to maintaining the current monthly dividend of $0.05 per share, which the Company believes is appropriate at existing commodity price levels, and expects to return in excess of $200 million per year to ARC’s shareholders.
(1) |
Sustaining capital refers to estimated capital expenditures to maintain production from existing facilities at approximately current production levels. |