TAMARACK VALLEY ENERGY LTD.
'We are excited to roll out a strong 2022 plan with a continued focus of building on and delivering sustainable free funds flow(1). Our program is designed to provide an optimal balance of investment across our asset base with the growth driven by the
Highlights of the 2022 Budget
Capital Program - Tamarack plans to invest
Production & Free Funds Flow(1) - This program will drive production of 45,000 to 46,000 boe/d(2) with a 73-75% oil and NGL weighting and is expected to generate
Capital Allocation - We will direct approximately 40% of our capital program to the
Uses of Free Funds Flow(1) - At budget pricing, free funds flow(1) will enable a reduction of debt and return of capital to shareholders.
Sustaining free funds flow breakeven price(1) - Inclusive of the base dividend, the budget achieves a free funds flow breakeven(1) of
ESG Commitment - Tamarack has allocated
The Company continues to manage commodity price risk and volatility through a prudent hedging management program, with 50% of gross oil production hedged against WTI on average through 2022. Our strategy provides protection to the downside while maximizing upside exposure. Additional details of the current hedges in place can be found in the corporate presentation on the Company website (www.tamarackvalley.ca).
Five-year Plan Update
In conjunction with the 2022 Budget and the Acquisition, Tamarack has updated its five-year plan(3) (2022- 2026). The five-year plan(3) highlights the significant free funds flow(1) generated by the Company's assets and the flexibility to direct funds to achieve long term debt targets, return of capital to shareholders and incremental growth of the business both organically and through M&A opportunities. The updated five-year plan reflects expected inflationary cost increases.
About
Tamarack is an oil and gas exploration and production company committed to creating long-term value for its shareholders through sustainable free funds flow generation, financial stability and the return of capital. The Company has an extensive inventory of low-risk, oil development drilling locations focused primarily on
Forward Looking Information
This press release contains certain forward-looking information (collectively referred to herein as 'forward looking statements') within the meaning of applicable Canadian securities laws. Forward-looking statements are often, but not always, identified by the use of words such as 'guidance', 'outlook', 'anticipate', 'target', 'plan', 'continue', 'intend', 'consider', 'estimate', 'expect', 'may', 'will', 'should', 'could' or similar words suggesting future outcomes. More particularly, this press release contains statements concerning: Tamarack's business strategy, objectives, strength and focus, including the Company's updated five year plan and the anticipated benefits thereof; the Acquisition and the timing thereof; future consolidation activity and organic growth; future intentions with respect to return of capital including dividends and share buybacks; the increased capacity under the Company's credit facilities, the extension of the revolving facility and the transition to an SLL Facility and the terms thereof; net debt reduction and debt targets; Tamarack's intention to return free funds flow to shareholders; the dividend policy; the granting of any special dividends or any share buybacks or other supplements to the base dividend; statements regarding plans or expectations for the declaration of future dividends and the amount thereof; oil and natural gas production levels, decline rates, adjusted funds flow, free funds flow; anticipated operational results for 2022 including, but not limited to, estimated or anticipated production levels, capital expenditures and drilling plans; the Company's revised capital program, guidance and budget for 2022 and 2022 capital program; expectations regarding commodity prices; the performance characteristics of the Company's oil and natural gas properties; the ability of the Company to achieve drilling success consistent with management's expectations; Tamarack's commitment to ESG principles; the source of funding for the Company's activities including development costs; 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 funds 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 Tamarack 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.
The forward-looking statements contained in this document are based on certain key expectations and assumptions made by Tamarack, including relating to: the business plan of Tamarack, Crestwynd and the assets to be acquired pursuant to the Acquisition; the receipt of all approvals and satisfaction of all conditions to the completion of the Acquisition; the timing of and success of future drilling, development and completion activities; the geological characteristics of Tamarack's properties; the characteristics of recently acquired assets; the successful integration of recently acquired assets into Tamarack's operations; prevailing commodity prices, price volatility, price differentials and the actual prices received for the Company's products; the availability and performance of drilling rigs, facilities, pipelines and other oilfield services; the timing of past operations and activities in the planned areas of focus; the drilling, completion and tie-in of wells being completed as planned; the performance of new and existing wells; the application of existing drilling and fracturing techniques; prevailing weather and break-up conditions; royalty regimes and exchange rates; the application of regulatory and licensing requirements; the continued availability of capital and skilled personnel; the ability to maintain or grow the banking facilities; the accuracy of Tamarack's geological interpretation of its drilling and land opportunities, including the ability of seismic activity to enhance such interpretation and Tamarack's ability to execute its plans and strategies.
Although management considers these assumptions to be reasonable based on information currently available, undue reliance should not be placed on the forward-looking statements because Tamarack can give no assurances that they may prove to be correct. By their very nature, forward-looking statements are subject to certain risks and uncertainties (both general and specific) that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements.
Contact:
Tel: 403.263.4440
Web: www.tamarackvalley.ca
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