Canada’s Tourmaline surges in Q2
Tourmaline Oil, Canada’s largest natural gas producer, reported sharply higher Q2 2021 earnings and cash flow on July 28 alongside record free cash flow of C$343.9mn (US$275.9mn) and a 37% increase in oil equivalent production.
Net earnings increased to C$420.85mn from C$20.1mn in the year ago period, while cash flow jumped to C$570.2mn from C$225.18mn. Record free cash flow came on upstream capital expenditures of C$215.9mn.
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Q2 production averaged 410,339 barrels of oil equivalent/day, up from 299,369 boe/d in Q2 2020. Natural gas output surged to 1.9bn ft3/d from 1.4bn ft3/d, reflecting several asset acquisitions in 2020 and earlier this year, while liquids production averaged 91,067 barrels/day, up from 61,386 b/d a year ago.
Tourmaline’s average realised natural gas price in Q2 2021 rose to C$3.25/’000 ft3 from C$2.41/’000 ft3 in Q2 2020, reflecting “significantly higher” benchmark prices across all the major hubs in which it sells its gas. Its most lucrative hubs, the PG&E Malin hub in Oregon and the PG&E City Gate hub in California, saw yr/yr benchmarks 89% and 66% higher, respectively.
Tourmaline said it intends to invest C$20-40mn/year in environmental improvement initiatives, largely in the areas of diesel displacement for drilling and completion operations, methane emission reduction initiatives targeting the eventual elimination of those emissions and gas plant emission reductions. Its environmental initiatives to-date have reduced its annual greenhouse gas emissions by about 250,000 mt/yr.