Canada’s Tourmaline sees 2021 earnings exceed C$2bn
Tourmaline Oil, Canada’s largest natural gas producer with core Montney and Deep Basin assets, said March 3 it had 2021 net earnings of C$2.03bn (US$1.6bn), up from C$618.3mn the year before.
It generated record cash flow for the year of C$2.9bn and record free cash flow of C$1.49bn, supporting a 29% annual increase in its base dividend, to C$0.72/share and a special dividend of C$0.75/share in October. Subsequent to year-end, Tourmaline increased its annual base dividend again, to C$0.80/share, and paid another special dividend of C$1.25/share.
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At current strip pricing, Tourmaline expects to generate cash flow this year of C$4.05bn and free cash flow of C$2.85bn on capital expenditures expected to hold steady at about C$1.1bn.
Fourth quarter net earnings in 2021 rose to C$996.2mn from C$629.2mn, while cash flow increased to C$968.2mn from C$396.9mn.
Oil equivalent production increased to 441,115 barrels of oil equivalent (boe)/day in 2021 from 310,598 boe/day in 2020. Natural gas production rose 40%, to 2.06bn ft3/day from 1.48bn ft3/day, while crude oil and liquids production was 51% higher, at 97,206 b/d against 64,496 b/d in 2020.
Total production in Q4 2021 averaged 485,078 boe/day, a 44% increase from Q4 2020, while natural gas production in the quarter averaged 2.2bn ft3/day, up from 1.59bn ft3/day in Q4 2020.
About 68% of the overall production increase reflects corporate acquisitions by Tourmaline since Q4 2020, with the balance attributed to a successful exploration and production program which saw it drill a total of 280 net wells in 2021 and increase its 2P reserves by 1.09bn boe. It now has 2P (proved+probable) natural gas reserves of about 19.5 trillion ft3, the largest reserves base in Canada and one of the largest – and lowest development cost – in North America.
According to BP’s Statistical Review of World Energy 2021, Canada had proved natural gas reserves at the end of 2020 of 83.1 trillion ft3; at the end of 2021, Tourmaline’s proved natural gas reserves stood at 8.76 trillion ft3.