Ovintiv cites strong 1Q financial results

At one point a few years ago, Ovintiv Inc. was reporting large producing oil wells in Oklahoma’s STACK play…a 3,000-barrel a day here and a 3,200 barrel a day well there. All it seems were in Kingfisher County.

But the Denver-based company reported it did not turn in line or turn any wells to sales during the first quarter of 2024. It still averaged 108,000 barrels of oil equivalent a day during the quarter. Ovintiv, in its first quarter financial report released this week stated it intends to invest up to $125 million in the Anadarko Basin to bring on seven to ten net wells.

The firm’s most active region is the Permian Basin where it anticipates bringing on line 130 wells for all of 2024.

Ovintiv stated it generated net earnings of $338 million or $1.24 per share and cash from operating avtivities of $659 million. It had free cash flow of $444 after capital expenditures of $591 million.

The firm said first quarter production was at the high-end or above its guidance range with average total production volumes of 574,000 barrels of oil equivalent a day.

“Our solid execution continued across the portfolio during the first quarter,” said Ovintiv President and CEO, Brendan McCracken.

“Our combination of strong productivity, leading capital efficiency and a stronger oil price environment have raised our expectations for 2024 Non-GAAP Free Cash Flow from $1.6 billion to $1.9 billion – roughly $750 million more than last year.”

Following the quarterly results, leadership raised its full year production guidance but left full yeear capital guidance unchanged. The company believes full year production volumes will average 560 to 575 MBOE/d with full year capital guidance of $2.2 billion to $2.4 billion.

Permian production averaged 206 MBOE/d (82% liquids) in the first quarter. The Company had 21 net wells turned in line (“TIL”). Ovintiv plans to invest approximately $1.35 to $1.45 billion in the play in 2024 to bring on 120 to 130 net wells.

Montney production averaged 226 MBOE/d (19% liquids) in the first quarter. The Company had 11 net wells TIL. Ovintiv plans to invest approximately $425 to $475 million in the play in 2024 to bring on 60 to 70 net wells.

Uinta production averaged 28 MBOE/d (79% liquids) in the first quarter. The Company had nine net wells TIL. Ovintiv plans to invest approximately $300 to $350 million in the play in 2024 to bring on 25 to 30 net wells.

Anadarko production averaged 108 MBOE/d (59% liquids) in the first quarter. The Company had no TILs during the quarter. Ovintiv plans to invest approximately $100 to $125 million in the play in 2024 to bring on seven to ten net wells.

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