Whitecap Resources Inc. announces transition to a sustainable intermediate light oil dividend-and-growth company and 2013 guidance
Wednesday, Nov 21, 2012
CALGARY, Nov. 20, 2012 /CNW/ - Whitecap Resources Inc. ("Whitecap", "we", "us", "our" or the "Company") (TSX: WCP) is pleased to announce its plans to transition to a pre-eminent intermediate size light oil producer focused on paying sustainable dividends and delivering long term per share growth.
Since inception Whitecap has delivered 33 percent compounded annual production growth on a fully diluted per share basis. We have strategically acquired and integrated light oil assets that have predictable production profiles, shallow declines, strong netbacks, and large repeatable light oil development drilling inventories. All these factors allow us to seamlessly transition to a dividend-and-growth model that can support sustainable dividend payments to our shareholders and also provide continuing annual per share growth of 3 to 5 percent.
Our assets currently under management provide high operating netbacks and, when combined with our low corporate cost structure, generate strong cash flow netbacks which will allow us to fully fund our planned dividend payments and capital program through internally generated funds from operations. Our basic payout ratio for 2013 is expected to be 32 percent and we anticipate total capital spending and dividend payments to represent less than 95 percent of our funds from operations.
In each of our core operating areas the funds from operations we forecast for 2013 are in excess of the forecasted capital spending in these areas which enables us to not only grow production but distribute excess funds from operations to our shareholders. The 2013 capital program will focus on advancing the development of our core areas, specifically targeting the Cardium, Viking and Montney oil reservoirs, which make up 97% of our current production and opportunities. We have demonstrated a track record of success in these plays which we will continue to execute in the new model.
We plan to drill between 70 - 75 (65 - 70 net) light oil wells for the year
including five (3.5 net) wells to advance the Valhalla North Montney waterflood project, 32 (31.4 net) horizontal Cardium oil wells split equally between the Garrington and greater Pembina areas of Alberta, 33 (30.1 net) horizontal Viking oil wells in the Lucky Hills area in western Saskatchewan, and two (1.8 net) oil wells in the Fosterton area of southwest Saskatchewan.
SOURCE Whitecap Resources Inc.
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