CALGARY, AB, Jan. 17, 2022 /CNW/ - Tourmaline Oil Corp.
(TSX: TOU) ("Tourmaline" or the "Company") is pleased to announce a
quarterly dividend increase and special cash dividend and provide
an operational update.
QUARTERLY DIVIDEND INCREASE AND SPECIAL DIVIDEND
Tourmaline is pleased to announce both a quarterly base dividend
increase of 11% and the declaration of a special cash dividend of
$1.25/share, given the continued
strong financial performance and outlook for the Company. The
quarterly dividend will be increased from $0.18/share to $0.20/share beginning in the first quarter of
2022. The special dividend, the second by the Company, is
part of Tourmaline's comprehensive shareholder return plan and will
be paid on February 1, 2022, to
shareholders of record on January 25,
2022. This special cash dividend is designated as an
"eligible dividend" for Canadian income tax purposes.
The Company anticipates paying further special dividends in 2022
as well as utilizing its normal course issuer bid during the course
of the year. Net debt(1) is forecast below the
long-term net debt target of $1.0-$1.2 billion.
EP OPERATIONS UPDATE
- Tourmaline achieved the 2021 exit production target of 500,000
boepd and expects first quarter 2022 production to range between
500,000 and 510,000 boepd.
- Current liquids production is 115,000 bpd, including 35,000 bpd
of condensate.
- Full-year 2022 production guidance remains at 500,000 boepd on
unchanged EP capital spending of $1.125
billion.
- Q4 2021 production averaged approximately 485,000 boepd, within
the lower end of guidance. Production was impacted by
approximately 6,000 boepd in December due to weather related
outages and minor EP operational and start-up delays.
- The Company plans to drill 85 wells (gross), complete 97 wells
(gross) and bring on production 83 new wells (gross) during the
first quarter of 2022. The Company accelerated the drilling
of one NEBC pad and fracs on two additional pads into 2H
December 2021 from Q1 2022, for
operational continuity and to be in a position to take advantage of
stronger winter natural gas prices.
- Tourmaline is currently operating 13 drilling rigs and five
frac spreads across the three operated EP complexes.
- The two 2H 2021 BC major facility expansions were completed on
budget. The 2022 EP capital budget contains minimal new
facility expenditures resulting in anticipated record 2022 capital
efficiencies of approximately $6,000/boepd.
________________________________
|
(1)
|
"Net debt" is
defined as bank debt and senior unsecured notes plus working
capital deficit (adjusted for the fair value of financial
instruments, short-term lease liabilities, short-term
decommissioning obligations and unrealized foreign exchange in
working capital deficit). See "Non-GAAP Financial Measures" in this
news release and in the Company's Q3 2021 Management's Discussion
and Analysis.
|
Reader Advisories
CURRENCY
All amounts in this news release are stated in Canadian dollars
unless otherwise specified.
FORWARD-LOOKING INFORMATION
This news release contains forward-looking information and
statements (collectively, "forward-looking information")
within the meaning of applicable securities laws. The use of any of
the words "forecast", "expect", "anticipate", "continue",
"estimate", "objective", "ongoing", "on track", "may", "will",
"project", "should", "believe", "plans", "intends" and similar
expressions are intended to identify forward-looking information.
More particularly and without limitation, this news release
contains forward-looking information concerning Tourmaline's plans
and other aspects of its anticipated future operations, management
focus, objectives, strategies, financial, operating and production
results, business opportunities and shareholder return plan,
including the following: the use of the normal course issuer bid;
the future declaration and payment of dividends and the timing and
amount thereof which assumes, among other things, the availability
of free cash flow to fund such dividends; anticipated petroleum and
natural gas production and production growth for various periods
including estimated production levels for Q1 2022 and full-year
2022; expected full-year 2022 EP capital spending levels; the
number of expected wells to be drilled, completed, and brought on
production in Q1 2022; anticipated winter natural gas prices; and
anticipated 2022 capital efficiencies. The forward-looking
information is based on certain key expectations and assumptions
made by Tourmaline, including expectations and assumptions
concerning the following: prevailing and future commodity prices
and currency exchange rates; the degree to which Tourmaline's
operations and production may be disrupted by circumstances
attributable to supply chain disruptions and the COVID-19 pandemic
and the responses of governments and the public to the pandemic;
applicable royalty rates and tax laws; interest rates; future well
production rates and reserve volumes; operating costs, the timing
of receipt of regulatory approvals; the performance of existing
wells; the success obtained in drilling new wells; anticipated
timing and results of capital expenditures; the sufficiency of
budgeted capital expenditures in carrying out planned activities;
the timing, location and extent of future drilling operations; the
benefits to be derived from acquisitions; the state of the economy
and the exploration and production business including the impacts
of the COVID-19 pandemic and the responses of governments and
the public to the pandemic thereon; the availability and cost of
financing, labour and services; and ability to market crude oil,
natural gas and natural gas liquids successfully. Without
limitation of the foregoing, future dividend payments, if any, and
the level thereof is uncertain, as the Company's dividend policy
and the funds available for the payment of dividends from time to
time is dependent upon, among other things, free cash flow,
financial requirements for the Company's operations and the
execution of its growth strategy, fluctuations in working capital
and the timing and amount of capital expenditures, debt service
requirements and other factors beyond the Company's control.
Further, the ability of Tourmaline to pay dividends will be subject
to applicable laws (including the satisfaction of the solvency test
contained in applicable corporate legislation) and contractual
restrictions contained in the instruments governing its
indebtedness, including its credit facility.
Although Tourmaline believes that the expectations and
assumptions on which such forward-looking information is based are
reasonable, undue reliance should not be placed on the
forward-looking information because Tourmaline can give no
assurances that it will prove to be correct. Since forward-looking
information addresses future events and conditions, by its very
nature it involves inherent risks and uncertainties. Actual results
could differ materially from those currently anticipated due to a
number of factors and risks. These include, but are not limited to:
the risks associated with the oil and gas industry in general such
as operational risks in development, exploration and production;
delays or changes in plans with respect to exploration or
development projects or capital expenditures; supply chain
disruptions; the uncertain impacts of COVID-19 on Tourmaline's
business, and the societal, economic and governmental response to
COVID-19; the uncertainty of estimates and projections relating to
reserves, production, revenues, costs and expenses; health, safety
and environmental risks; commodity price and exchange rate
fluctuations; interest rate fluctuations; marketing and
transportation; loss of markets; environmental risks; competition;
incorrect assessment of the value of acquisitions; failure to
complete or realize the anticipated benefits of acquisitions or
dispositions; ability to access sufficient capital from internal
and external sources; uncertainties associated with counterparty
credit risk; failure to obtain required regulatory and other
approvals; and changes in legislation, including but not limited to
tax laws, royalties and environmental regulations. Readers are
cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could
affect Tourmaline, or its operations or financial results, are
included in the Company's most recently filed Management's
Discussion and Analysis (See "Forward-Looking Statements" therein),
Annual Information Form (See "Risk Factors" and "Forward-Looking
Statements" therein) and other reports on file with applicable
securities regulatory authorities and may be accessed through the
SEDAR website (www.sedar.com) or Tourmaline's website
(www.tourmalineoil.com).
The forward-looking information contained in this news release
is made as of the date hereof and Tourmaline undertakes no
obligation to update publicly or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, unless expressly required by applicable securities
laws.
BOE EQUIVALENCY
In this news release, production information may be presented on
a "barrel of oil equivalent" or "BOE" basis. BOEs 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. In addition, as the
value ratio between natural gas and crude oil based on the current
prices of natural gas and crude oil is significantly different from
the energy equivalency of 6:1, utilizing a conversion on a 6:1
basis may be misleading as an indication of value.
NON-GAAP FINANCIAL MEASURES
This news release includes references to "net debt" which is a
financial measure commonly used in the oil and gas industry and
does not have a standardized meaning prescribed by International
Financial Reporting Standards ("GAAP"). Accordingly, the Company's
use of this term may not be comparable to similarly defined
measures presented by other companies. Management uses the term
"net debt" for its own performance measures and to provide
shareholders and potential investors with a measurement of the
Company's efficiency. Investors are cautioned that this non-GAAP
measure should not be construed as an alternative to financial
measures determined in accordance with GAAP as an indication of the
Company's performance. "Net debt" is defined as bank debt and
senior unsecured notes plus working capital deficit (adjusted for
the fair value of financial instruments, short-term lease
liabilities, short-term decommissioning obligations and unrealized
foreign exchange in working capital deficit). See "Non-GAAP
Financial Measures" in the most recent Management's Discussion and
Analysis for more information on the definition and description of
this term.
OIL AND GAS METRICS
This news release contains certain oil and gas metrics which do
not have standardized meanings or standard methods of calculation
and therefore such measures may not be comparable to similar
measures used by other companies and should not be used to make
comparisons. Such metrics have been included in this document to
provide readers with additional measures to evaluate the Company's
performance; however, such measures are not reliable indicators of
the Company's future performance and future performance may not
compare to the Company's performance in previous periods and
therefore such metrics should not be unduly relied upon.
SUPPLEMENTAL INFORMATION REGARDING PRODUCT TYPES
This news release includes references to 2021 exit production,
Q4 2021 production, Q1 2022 expected average daily production and
full-year 2022 expected average daily production. The following
table is intended to provide supplemental information about the
product type composition for each of the production figures that
are provided in this news release:
|
Light and
Medium
Crude Oil(1)
|
|
Conventional
Natural Gas
|
|
Shale Natural
Gas
|
|
Natural Gas
Liquids(1)
|
|
Oil Equivalent
Total
|
|
Company Gross
(Bbls)
|
|
Company Gross
(Mcf)
|
|
Company Gross
(Mcf)
|
|
Company Gross
(Bbls)
|
|
Company Gross
(Boe)
|
2021 Exit
Production........
|
40,000
|
|
1,334,000
|
|
1,000,000
|
|
71,000
|
|
500,000
|
Q4 2021
Production........................
|
40,850
|
|
1,300,000
|
|
969,500
|
|
65,900
|
|
485,000
|
Q1 2022 Expected
Average Daily Production
|
42,000
|
|
1,250,000
|
|
1,090,000
|
|
73,000
|
|
505,000
|
2022 Expected
Average
Daily Production...............
|
42,600
|
|
1,224,000
|
|
1,085,000
|
|
72,600
|
|
500,000
|
|
|
|
|
|
|
|
|
|
|
(1)
|
For the purposes
of this disclosure, condensate has been combined with Light and
Medium Crude Oil as the associated revenues and certain costs of
condensate are similar to Light and Medium Crude Oil.
Accordingly, NGLs in this disclosure exclude
condensate.
|
CERTAIN DEFINITIONS:
1H
|
first half
|
2H
|
second
half
|
bbl
|
barrel
|
bbls/day
|
barrels per
day
|
bbl/mmcf
|
barrels per million
cubic feet
|
bcf
|
billion cubic
feet
|
bcfe
|
billion cubic feet
equivalent
|
bpd or
bbl/d
|
barrels per
day
|
boe
|
barrel of oil
equivalent
|
boepd or
boe/d
|
barrel of oil
equivalent per day
|
bopd or
bbl/d
|
barrel of oil,
condensate or liquids per day
|
DUC
|
drilled but
uncompleted wells
|
EP
|
exploration and
production
|
gj
|
gigajoule
|
gjs/d
|
gigajoules per
day
|
mbbls
|
thousand
barrels
|
mmbbls
|
million
barrels
|
mboe
|
thousand barrels of
oil equivalent
|
mboepd
|
thousand barrels of
oil equivalent per day
|
mcf
|
thousand cubic
feet
|
mcfpd or
mcf/d
|
thousand cubic feet
per day
|
mcfe
|
thousand cubic feet
equivalent
|
mmboe
|
million barrels of
oil equivalent
|
mmbtu
|
million British
thermal units
|
mmbtu/d
|
million British
thermal units per day
|
mmcf
|
million cubic
feet
|
mmcfpd or
mmcf/d
|
million cubic feet
per day
|
MPa
|
megapascal
|
mstb
|
thousand stock tank
barrels
|
natural
gas
|
conventional natural
gas and shale gas
|
NCIB
|
normal course issuer
bid
|
NGL or
NGLs
|
natural gas
liquids
|
tcf
|
trillion cubic
feet
|
ABOUT TOURMALINE OIL CORP.
Tourmaline is an investment grade Canadian senior crude oil and
natural gas exploration and production company focused on providing
strong and predictable long-term growth and a steady return to
shareholders through an aggressive exploration, development,
production and acquisition program in the Western Canadian
Sedimentary Basin by building its extensive asset base in its three
core exploration and production areas and exploiting and developing
these areas to increase reserves, production and cash flows at an
attractive return on invested capital.
SOURCE Tourmaline Oil Corp.