With the majority of the companies in our dataset having now reported their Q1 2024 financial and operating results, it’s time for another entry in our Earnings Season Report Card series. The first quarter saw oil prices trend up gradually, although aggregate realized pricing was depressed compared to Q4 2023. Natural gas and NGLs trended in opposite directions, with natural gas prices declining and NGL pricing improving very slightly relative to the previous quarter. We believe this likely contributed to a general trend of reduced production and cash flow generation in Q1, although a number of companies saw improvements in both of these metrics. Capital spending increased in aggregate, however, suggesting that companies aren’t letting a somewhat muted quarter impact their budgets for the year. As per usual, we’re focusing on production and financial metrics in part 1 before moving on to per-barrel indicators in part 2. We focus primarily on the top performers for each metric over the quarter, although we do discuss industry-level averages and trends. To access data on all of the companies in our dataset, head over to BOE Intel.
Q1 was a mixed bag with respect to liquids production, but the average company in our dataset saw production decrease by just under 1%. 15 out of 34 companies reported increased liquids production in the first quarter compared to Q4 2023. Pine Cliff oversaw the largest proportional increase in liquids production, boosting output by just under 63%. Part of this increase was likely related to the company’s acquisition of Certus Oil & Gas Inc., which closed in December 2023; the company announced that the acquired production of 5,300 BOE/d was 49% liquids as of September 2023. Pieridae also boosted liquids production by 25.3%, which exceeded the company’s expectations in light of a mid-March outage at the Jumping Pound processing facility as well as the lingering impact of a production shut-in at the company’s Clearwater asset. Crescent Point (now Veren), of course, benefitted from the incorporation of assets it acquired from Hammerhead. The transaction, which closed in December 2023, saw Veren absorb all of Hammerhead’s production. For context, Hammerhead’s Q3 2023 corporate liquids production was just over 22,000 BBL/d.
| Company | Q1 2024 (BBL/D) | Q4 2023 (BBL/d) | Absolute Difference (BBL/d) | Percentage Change (%) |
| Pine Cliff | 4,926 | 3,037 | 1,889 | 62.2 |
| Pieridae | 5,394 | 4,305 | 1,089 | 25.3 |
| Crescent Point (Veren) | 132,684 | 112,167 | 20,517 | 18.3 |
| Yangarra | 4,776 | 4,252 | 524 | 12.3 |
| Obsidian Energy | 22,610 | 20,641 | 1,969 | 9.5 |
| Petrus Resources | 3,086 | 2,825 | 261 | 9.2 |
| Tourmaline | 145,016 | 133,093 | 11,923 | 9.0 |
| Peyto | 17,145 | 16,175 | 970 | 6.0 |
| Spartan Delta | 12,301 | 11,636 | 665 | 5.7 |
| Kiwetinohk | 12,479 | 11,914 | 565 | 4.7 |
| Average | 94,750 | 95,448 | -698 | -0.7 |
Veren Production by Commodity, Q1 2022 – Q1 2024
Unlike liquids production, natural gas production increased ever so slightly in Q1 2024. With the average company in our dataset increasing production by 0.9%, overall gas output was largely consistent with last quarter. With that said, a few companies did stand out for having reported notable gas production increases. Veren, as discussed above, likely benefitted from the integration of gas-producing assets acquired from Hammerhead. Kiwetinohk increased its gas production by 17.9%, which was potentially driven by a productive 3-well Duvernay pad that was brought on stream in the first quarter. Check out this 3-well pad on Petro Ninja here. Tourmaline, which completed its acquisition of Bonavista in November 2023, likely benefitted from the continued integration of Bonavista’s producing gas assets; the company brought 70 UWIs on stream in Q1 2024 compared to 86 in Q1 2023, suggesting that increased drilling wasn’t the root cause of the production boost.
| Company | Q1 2024 (MMcf/d) | Q4 2023 (MMcf/d) | Absolute Difference (MMcf/d) | Percentage Change (%) |
| Crescent Point (Veren) | 395 | 248 | 147 | 59.2 |
| Headwater | 12 | 8 | 4 | 43.8 |
| Kiwetinohk | 90 | 77 | 14 | 17.9 |
| Tourmaline | 2,682 | 2,543 | 139 | 5.5 |
| Whitecap | 369 | 352 | 17 | 4.8 |
| Peyto | 647 | 623 | 24 | 3.9 |
| Obsidian Energy | 70 | 68 | 2 | 2.9 |
| Pine Cliff | 114 | 110 | 3 | 2.8 |
| Kelt Exploration | 124 | 121 | 3 | 2.8 |
| Spartan Delta | 157 | 156 | 1 | 0.8 |
| Average | 402 | 398 | 4 | 0.9 |
Kiwetinohk Production by Commodity, Q1 2022 – Q1 2024
Despite positive oil price shifts in the quarter, overall realized commodity prices took a turn for the worse in Q1 and this has had impacts on cash flow in the industry; operating cash flow generation declined for most Canadian E&Ps. The average company in our dataset saw operating cash flow decline by 33.9% compared to Q4 2023, the largest decline we’ve observed since Q1 2023. A few companies bucked this trend, however, with a handful of gas-weighted producers growing cash from operations. Yangarra and Kiwetinohk led the industry, achieving quarter-over-quarter growth of 31.7% and 27.5% respectively. Yangarra grew its corporate production slightly compared to Q4 2023, but the major difference maker was its increased liquids portion of production; this figure rose from 38% in Q4 2023 to 43% last quarter. Kiwetinohk, as shown above, benefitted from an increase in corporate production and a decrease in operating costs. In aggregate, Kiwetinohk grew its production by 11.7% while reducing its operating costs by 18.6% quarter-over-quarter. Peyto also increased its operating cash flow by 13.6%, which we suspect was driven in part by the incorporation of assets obtained through its acquisition of Repsol (which closed in October 2023).
| Company | Q1 2024 ($) | Q4 2023 ($) | Absolute Difference ($) | Percentage Change (%) |
| Yangarra | 22,124,000 | 16,798,000 | 5,326,000 | 31.7 |
| Kiwetinohk | 75,183,000 | 58,946,000 | 16,237,000 | 27.5 |
| Peyto | 196,829,000 | 173,247,000 | 23,582,000 | 13.6 |
| Vermilion | 354,295,000 | 343,831,000 | 10,464,000 | 3.0 |
| Kelt Exploration | 62,493,000 | 62,477,000 | 16,000 | 0.0 |
| Spartan Delta | 48,151,000 | 51,289,000 | -3,138,000 | -6.1 |
| ARC Resources | 636,300,000 | 698,900,000 | -62,600,000 | -9.0 |
| Rubellite | 16,497,000 | 18,963,000 | -2,466,000 | -13.0 |
| Surge Energy | 66,785,000 | 79,712,000 | -12,927,000 | -16.2 |
| Imperial | 1,076,000,000 | 1,311,000,000 | -235,000,000 | -17.9 |
| Average | 401,795,722 | 608,255,306 | -206,459,583 | -33.9 |
Yangarra Corporate Production & Operating Cash Flow, Q1 2018 – Q1 2024
Overall, net debt was largely unchanged this quarter; the average company recorded a modest 0.2% net debt increase through Q1. Of the companies for which we have net debt data available, 15 companies decreased net debt while 19 increased it. Vermilion recorded the largest proportional decrease in its net debt, which declined by 12.4% quarter-over-quarter. Per the company’s May 2024 corporate presentation, production in the first quarter came in at the upper end of its guidance range and helped finance a reduction in net debt that carried it below Vermilion’s $1 billion net debt target. Gear Energy and Rubellite also reduced their net debt balances by over 10% in the first quarter. Gear, which considers its low relative debt level to be a key strength, has predicted that the company will achieve a 0.24x year end Net Debt to funds from operations (FFO) ratio. On the other side of the spectrum, Kelt Exploration boosted its net debt by almost 146% in Q1 2024 (although its debt levels still remain relatively low). This is likely related to a notable boost in its 2024 budget in comparison to its spending in 2022 and 2023; Kelt’s drilling and completions budget for 2024 is 14% greater than its 2023 spending, while its projected 2024 spending on land, seismic and A&D is $16.4 million higher than in 2023. Cardinal and NuVista both reported quarter-over-quarter net debt increases of over 42%. Cardinal had expenditures related to its Saskatchewan thermal project, while NuVista’s net debt increase still places it well within its target of a net debt to adjusted funds flow ratio of less than 1.0x.
| Company | Q1 2024 ($) | Q4 2023 ($) | Absolute Difference ($) | Percentage Change (%) |
| Top 5 Reductions | ||||
| Vermilion | 944,496,000 | 1,078,567,000 | -134,071,000 | -12.4 |
| Gear Energy | 12,462,000 | 14,099,000 | -1,637,000 | -11.6 |
| Rubellite | 45,499,000 | 50,984,000 | -5,485,000 | -10.8 |
| Yangarra | 109,148,000 | 118,646,000 | -9,498,000 | -8.0 |
| Perpetual | 19,861,000 | 21,566,000 | -1,705,000 | -7.9 |
| Top 5 Increases | ||||
| Crew Energy | 147,689,000 | 117,355,000 | 30,334,000 | 25.8 |
| Advantage Energy | 279,963,000 | 222,022,000 | 57,941,000 | 26.1 |
| NuVista | 261,171,000 | 183,551,000 | 77,620,000 | 42.3 |
| Cardinal Energy | 119,716,000 | 83,650,000 | 36,066,000 | 43.1 |
| Kelt Exploration | 31,961,000 | 12,997,000 | 18,964,000 | 145.9 |
| Average | 1,430,877,412 | 1,427,896,294 | 2,981,118 | 0.2 |
Vermilion Net Debt & Capital Expenditures, Q1 2018 – Q1 2024
Despite a drop in operating cash flow generation, most companies surged ahead with their capital programs in the first quarter. Compared to Q4 2023, the average company increased capital spending by 5.6%. Of the 35 companies for which we have capital expenditure data availability, 19 companies increased spending quarter-over-quarter. We were particularly interested to see that 5 companies more than doubled their Q4 2023 Capex numbers, with another 3 companies achieving increases of over 90%. This was NuVista’s largest quarter of capital spending since Q1 2023 and its second largest quarter ever. According to the company’s Q1 2024 MD&A, almost 70% was “allocated to drilling and completion related activities, resulting in 9 (9.0 net) wells drilled and 18 (18.0 net) wells completed“. Bonterra also recorded its highest capital expenditures figure since Q1 2023. Of the total of $32.9 million, $27.0 million was directed to “the drilling of 11 gross (10.5 net) operated wells and the completion, and the equip and tie-in of gross 11 (10.0 net) operated wells“. Baytex, which increased its capital spending by 107.1% in Q1, allocated over 60% of its exploration and development budget south of the border. As always, please note that we do not include acquisitions and dispositions (A&D) in the capital expenditures figures in our dataset.
| Company | Q1 2024 ($) | Q4 2023 ($) | Absolute Difference ($) | Percentage Change (%) |
| NuVista | 187,856,000 | 69,258,000 | 118,598,000 | 171.2 |
| Bonterra Energy | 32,924,000 | 14,009,000 | 18,915,000 | 135.0 |
| Baytex | 412,551,000 | 199,214,000 | 213,337,000 | 107.1 |
| Cardinal Energy | 32,942,000 | 16,012,000 | 16,930,000 | 105.7 |
| Advantage Energy | 80,134,000 | 39,938,000 | 40,196,000 | 100.6 |
| Athabasca | 76,011,000 | 38,752,000 | 37,259,000 | 96.1 |
| Whitecap | 393,200,000 | 200,500,000 | 192,700,000 | 96.1 |
| Headwater | 65,267,000 | 33,800,000 | 31,467,000 | 93.1 |
| Crescent Point | 413,300,000 | 278,900,000 | 134,400,000 | 48.2 |
| Crew Energy | 77,161,000 | 53,165,000 | 23,996,000 | 45.1 |
| Average | 244,907,800 | 231,937,657 | 12,970,143 | 5.6 |
NuVista Operating Cash Flow & Capital Expenditures, Q1 2018 – Q1 2024
To dive in to these results further, check out BOE Intel.