BOE Intel spotlight on Whitecap Resources – Costs down across the board in Q4

Whitecap Resources reported its Q4 on Wednesday, and as expected, production reached an all-time high in the quarter. Production of 166,392 boe/d set a record for Whitecap, bolstered by the XTO acquisition in the summer of 2022. Analysts had expected record levels of production, although Whitecap did still find a way to beat consensus estimates by a small amount.

Of particular interest to us, was that costs were down across the board in Q4, bucking the trend of inflationary pressures seen by most producers over the last couple of years. Using our new BOE Intel software, we can see the easing of inflationary pressures in Whitecap’s financials.

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Cost summary Q4 vs. Q3

• Operating costs fell 5% to $14.13/boe.
• Transportation costs fell 7% to $2.12/boe.
• Royalty costs were down 18% to $13.34/boe, as a result of falling commodity prices.
• G&A costs were unchanged at $1/boe.

Netback

The improved cost profile in the quarter helped to provide a cushion against falling commodity prices in Q4. As a result, Whitecap reported an after hedging operating netback of $42.26/boe, which was down 5% from the prior quarter.