Baytex Announces 2025 Budget
Baytex Energy has announced its 2025 budget with exploration and development expenditures of $1.2-1.3 billion, targeting average annual production of 150,000-154,000 boe/d. The budget is based on US$65/bbl WTI price, with 60% of capital program weighted to first half of 2025.
The company plans to allocate 55-60% of expenditures to Eagle Ford assets and 40-45% to Canadian assets. Production mix will be 85% liquids and 15% natural gas. The company intends to split free cash flow equally between shareholder returns (buybacks and dividends) and balance sheet strengthening.
In the Eagle Ford, Baytex expects to bring 54 net wells onstream, while in Canada, plans include nine net wells in Pembina Duvernay, 90 net wells in Viking, and 112 net wells in heavy oil operations, including 33 Clearwater wells at Peavine.
Baytex Energy ha annunciato il suo budget per il 2025, prevedendo spese per esplorazione e sviluppo tra 1,2 e 1,3 miliardi di dollari, con un obiettivo di produzione annuale media di 150.000-154.000 boe/giorno. Il budget è basato su un prezzo del WTI di 65 dollari al barile, con il 60% del programma di capitali concentrato nella prima metà del 2025.
L'azienda prevede di allocare il 55-60% delle spese agli attivi dell'Eagle Ford e il 40-45% agli attivi canadesi. La miscela di produzione sarà composta per l'85% da liquidi e per il 15% da gas naturale. L'azienda intende dividere il flusso di cassa libero equamente tra i ritorni per gli azionisti (riacquisti e dividendi) e il rafforzamento del bilancio.
Nell'Eagle Ford, Baytex si aspetta di mettere in produzione 54 pozzi netti, mentre in Canada i piani includono nove pozzi netti nel Pembina Duvernay, 90 pozzi netti nel Viking e 112 pozzi netti nelle operazioni di petrolio pesante, comprese 33 perforazioni Clearwater a Peavine.
Baytex Energy ha anunciado su presupuesto para 2025 con gastos de exploración y desarrollo de 1.2 a 1.3 mil millones de dólares, con un objetivo de producción anual promedio de 150,000 a 154,000 boe/día. El presupuesto se basa en un precio de WTI de 65 dólares por barril, con el 60% del programa de capital concentrado en la primera mitad de 2025.
La compañía planea asignar entre el 55% y el 60% de los gastos a activos de Eagle Ford y entre el 40% y el 45% a activos canadienses. La mezcla de producción consistirá en un 85% de líquidos y un 15% de gas natural. La compañía tiene la intención de dividir el flujo de caja libre equitativamente entre retornos para los accionistas (recompras y dividendos) y el fortalecimiento del balance.
En Eagle Ford, Baytex espera poner en producción 54 pozos netos, mientras que en Canadá, los planes incluyen nueve pozos netos en Pembina Duvernay, 90 pozos netos en Viking y 112 pozos netos en operaciones de petróleo pesado, incluyendo 33 pozos Clearwater en Peavine.
베이텍스 에너지는 2025년 예산을 발표하며 탐사 및 개발 비용으로 12억에서 13억 달러를 계획하고 있으며, 평균 연간 생산 목표는 15만에서 15만 4천 boe/일입니다. 이 예산은 WTI 가격을 배럴당 65달러로 기준하고 있으며, 자본 프로그램의 60%는 2025년 상반기에 집중될 예정입니다.
회사는 지출의 55-60%를 이글 포드 자산에, 40-45%를 캐나다 자산에 할당할 계획입니다. 생산 믹스는 85%가 액체, 15%가 천연 가스가 될 것입니다. 회사는 자유 현금 흐름을 주주 환원(자사주 매입 및 배당금)과 재무 강화에 균등하게 나누는 것을 목표로 하고 있습니다.
이글 포드에서 베이텍스는 54개의 순해를 가동할 것으로 기대하고 있으며, 캐나다에서는 펨비나 두버니에서 9개의 순해, 바이킹에서 90개의 순해, 중유 작업에서 112개의 순해, 포함하여 피빈에서 33개의 클리어워터 해양을 계획하고 있습니다.
Baytex Energy a annoncé son budget pour 2025 avec des dépenses d'exploration et de développement de 1,2 à 1,3 milliard de dollars, visant une production annuelle moyenne de 150 000 à 154 000 boe/jour. Le budget est basé sur un prix WTI de 65 dollars par baril, avec 60 % du programme de capitaux concentré sur la première moitié de 2025.
La société prévoit d'allouer 55-60 % des dépenses à des actifs d'Eagle Ford et 40-45 % à des actifs canadiens. Le mix de production sera composé de 85 % de liquides et de 15 % de gaz naturel. L'entreprise a l'intention de partager le flux de trésorerie libre également entre les retours aux actionnaires (rachat d'actions et dividendes) et le renforcement du bilan.
Dans l'Eagle Ford, Baytex s'attend à mettre en production 54 puits nets, tandis qu'au Canada, les plans comprennent neuf puits nets dans le Pembina Duvernay, 90 puits nets dans le Viking et 112 puits nets dans des opérations de pétrole lourd, y compris 33 puits Clearwater à Peavine.
Baytex Energy hat sein Budget für 2025 bekanntgegeben, mit Investitionen in Exploration und Entwicklung von 1,2 bis 1,3 Milliarden US-Dollar und einer angestrebten durchschnittlichen Jahresproduktion von 150.000 bis 154.000 boe/Tag. Das Budget basiert auf einem WTI-Preis von 65 US-Dollar pro Barrel, wobei 60% des Investitionsprogramms auf die erste Hälfte des Jahres 2025 entfallen.
Das Unternehmen plant, 55-60% der Ausgaben in Eagle Ford-Assets und 40-45% in kanadische Assets zu investieren. Die Produktionsmischung wird zu 85% aus Flüssigkeiten und zu 15% aus Erdgas bestehen. Das Unternehmen beabsichtigt, den freien Cashflow gleichmäßig zwischen den Rückflüssen an die Aktionäre (Aktienrückkäufe und Dividenden) und der Stärkung der Bilanz aufzuteilen.
In Eagle Ford erwartet Baytex, 54 Netto-Bohrungen in Betrieb zu nehmen, während in Kanada neun Netto-Bohrungen in Pembina Duvernay, 90 Netto-Bohrungen im Viking und 112 Netto-Bohrungen in Schweröl-Operationen geplant sind, einschließlich 33 Clearwater-Bohrungen in Peavine.
- Stable production target of 150,000-154,000 boe/d
- 85% of production is operated, forecast to increase 1% in 2025
- 7% improvement target in operated drilling and completion costs per lateral foot in Eagle Ford
- Strong hedging position with ~45% of H1 2025 net crude oil exposure protected
- Reduction in non-operated Eagle Ford volumes expected due to reduced activity
- Q1 2025 production guidance lower at 147,000-149,000 boe/d
- Higher costs due to strengthening U.S. dollar impact on expense structure
Insights
Baytex Energy's 2025 budget reveals a disciplined capital allocation strategy with
The capital program demonstrates fiscal prudence with:
- Eagle Ford focus (
55-60% of expenditure) - Balanced free cash flow allocation:
50% to shareholder returns,50% to debt reduction - Cost efficiency initiatives targeting
7% reduction in Eagle Ford drilling costs
The conservative
The 2025 operational strategy reflects a shift toward operational efficiency and sustainable development. Notable operational elements include:
- Consistent two-rig Eagle Ford program promoting operational efficiency
- Balanced portfolio with 265 net wells planned across diverse assets
- Strategic focus on operated assets (
85% of production) - Production mix optimization with
44% light oil/condensate
The company's pivot to level-loaded development in Eagle Ford demonstrates mature asset management, while the Pembina Duvernay and heavy oil developments provide portfolio diversification. The moderate growth profile and focus on operational efficiency suggest a sustainable long-term development approach, though success will depend heavily on execution and commodity price environment.
Calgary, Alberta--(Newsfile Corp. - December 3, 2024) - Baytex Energy Corp. (TSX: BTE) (NYSE: BTE) ("Baytex") is pleased to announce its 2025 budget.
"Our 2025 budget demonstrates the strength of our oil-weighted portfolio as we target continued strong performance in the Eagle Ford, further progression of the Pembina Duvernay and capital efficient heavy oil development. We are focused on disciplined capital allocation to prioritize free cash flow while maintaining a strong balance sheet. In the current commodity price environment this means moderating our growth profile and delivering stable crude oil production," commented Eric T. Greager, President and Chief Executive Officer.
2025 Budget
The Board of Directors has approved a budget for 2025 exploration and development expenditures of
Our operated production represents approximately
The 2025 capital program is expected to be
In the Eagle Ford, we expect to bring 54 net wells onstream, including 41 net operated wells. In our Canadian light oil business unit, we expect to bring onstream nine net wells in the Pembina Duvernay and 90 net wells in the Viking. In our heavy oil business unit, we expect to bring onstream 112 net wells, including 33 net Clearwater wells at Peavine.
On our operated Eagle Ford acreage, we are shifting to a level-loaded pace of development in order to drive further efficiencies in our business. We intend to run a consistent two rig and one frac crew program for most of the year and are targeting a
Based on the mid-point of our production guidance of 152,000 boe/d, approximately
Based on our production profile and timing of capital expenditures, the majority of our free cash flow is expected to be generated in the second half of the year. We intend to allocate approximately
2025 Guidance
The following table summarizes our 2025 annual guidance.
| Exploration and development expenditures | |
| Production (boe/d) | 150,000 - 154,000 |
| Expenses: | |
| Average royalty rate (1) | ~ |
| Operating (2) | |
| Transportation (2) | |
| General and administrative (2) | |
| Interest (2) | |
| Current Income Taxes | ~ |
| Leasing expenditures | |
| Asset retirement obligations |
We expect to exit 2024 producing 152,000 to 153,000 boe/d. For 2025, given the timing of wells to sales in our non-operated Eagle Ford asset, we anticipate production in the first quarter of 147,000 to 149,000 boe/d, with volumes increasing in the following quarters.
Our operating and transportation expense guidance is largely unchanged from 2024, after adjusting for a strengthening U.S. dollar relative to the Canadian dollar. Our 2025 guidance is based on an exchange rate of 1.40 CAD/USD.
A strengthening U.S. dollar relative to the Canadian dollar positively impacts our free cash flow, while also impacting our cost structure. On an annual basis, a
2025 Exploration and Development Expenditures and Wells On-Stream
| Operating Area | Amount (4) ($ millions) | Wells On-stream (net) |
| United States (5) | 54 | |
| Canada | 211 | |
| Total | 265 |
(1) Specified financial measure that does not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and may not be comparable with the calculation of similar measures presented by other entities. Refer to the Specified Financial Measures section in this press release for further information.
(2) Supplementary financial measure calculated as operating, transportation, general and administrative or cash interest expense divided by barrels of oil equivalent production volume for the applicable period.
(3) Calculated in accordance with our amended credit facilities agreement which is available on SEDAR+ at www.sedarplus.ca.
(4) Reflects the mid-point of the exploration and development expenditures guidance range.
(5) United States exploration and development expenditures of US
2025 Breakdown of Exploration and Development Expenditures
| Classification | Amount (1) ($ millions) |
| Drill, completion and equipping | |
| Facilities | |
| Land, seismic and other | |
| Environmental stewardship | |
| Total |
Risk Management
We employ a disciplined commodity hedging program to reduce the impact of sustained low commodity prices on our revenues.
For the first half of 2025, we have entered into hedges on approximately
Five-Year Outlook
We have updated our five-year outlook (2024 to 2028) to reflect 2024 year-to-date operating and financial results and our plan to prioritize free cash flow and moderate our growth profile. This plan delivers stable production and continued strong shareholder returns at a mid-cycle WTI price of US
With moderated growth, we anticipate annual exploration and development expenditures are maintained at
Should WTI trade above or below mid-cycle prices for an extended period, we have flexibility to adjust our capital spending and production profile to maximize long-term value for our business.
To illustrate our sensitivity to changes in WTI, based on a constant US
(1) Reflects the mid-point of the exploration and development expenditures guidance range.
(2) Specified financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures presented by other entities. Refer to the Specified Financial Measures section in this press release for further information.
(3) Five-year outlook pricing assumptions: WCS differential - US
(4) Calculated in accordance with the amended credit facilities agreement which is available on SEDAR+ at www.sedarplus.ca.
Advisory Regarding Forward-Looking Statements
In the interest of providing Baytex's shareholders and potential investors with information regarding Baytex, including management's assessment of Baytex's future plans and operations, certain statements in this press release are "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation (collectively, "forward-looking statements"). In some cases, forward-looking statements can be identified by terminology such as "anticipate", "believe", "continue", "could", "estimate", "expect", "forecast", "intend", "may", "objective", "ongoing", "outlook", "potential", "project", "plan", "should", "target", "would", "will" or similar words suggesting future outcomes, events or performance. The forward-looking statements contained in this press release speak only as of the date thereof and are expressly qualified by this cautionary statement. Specifically, this press release contains forward-looking statements relating to but not limited to: that in 2025 we are targeting strong Eagle Ford performance, progression of Pembina Duvernay and capital efficient heavy oil development; our capital allocation to prioritize free cash flow and maintain a strong balance sheet; our expectations for a moderated growth profile and stable crude oil production; our drilling plans for 2025 and the anticipated locations and the timing thereof; our target for improved drilling and completion costs; the composition of our forecasted 2025 production; expected timing of free cash flow during the year and our plans regarding the allocation of free cash flow to share buybacks, base dividend and balance sheet; our 2025 guidance, including exploration and development expenditures (including by operating area and classification), production, average royalty rate, expenses (operating, transportation, general and administrative, interest and current income taxes), leasing expenditures and asset retirement obligations; for 2024 our expected exit rate production; our expected production rate for Q1 2025; the expected impact of the Cad/US dollar exchange rate on our operating expenditures, exploration and development expenditures and total debt; the percentage of our net crude exposure that is hedged for 2025; expectations regarding our five-year outlook, including forecasted production, free cash flow, anticipated shareholder returns, and the sensitivity of the free cash flow over the outlook period to changes in WTI price; our commitments and goals in respect of our five-year outlook; and other similar statements.
These forward-looking statements are based on certain key assumptions regarding, among other things: petroleum and natural gas prices and differentials between light, medium and heavy oil prices; well production rates and reserve volumes; our ability to add production and reserves through our exploration and development activities; exploration and development expenditure levels; our ability to borrow under our credit agreements; the receipt, in a timely manner, of regulatory and other required approvals for our operating activities; the availability and cost of labour and other industry services; interest and foreign exchange rates; the continuance of existing and, in certain circumstances, proposed tax and royalty regimes; our ability to develop our crude oil and natural gas properties in the manner currently contemplated; availability of skilled labour; timing and amount of capital expenditures; our future costs of operations are as anticipated; the timing of drilling and completion of wells is as anticipated; that we will have sufficient cash flow, debt or equity sources or other financial resources required to fund our capital and operating expenditures and requirements as needed; that our conduct and results of operations will be consistent with our expectations; that we will have sufficient financial resources in the future to allocate to shareholder returns; current industry conditions, laws and regulations continuing in effect (or, where changes are proposed, such changes being adopted as anticipated); the assumptions set forth in this press release; and other matters. Readers are cautioned that such assumptions, although considered reasonable by Baytex at the time of preparation, may prove to be incorrect.
Actual results achieved will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Such factors include, but are not limited to: the volatility of oil and natural gas prices and price differentials; restrictions or costs imposed by climate change initiatives and the physical risks of climate change; risks associated with our ability to develop our properties and add reserves; the impact of an energy transition on demand for petroleum productions; changes in income tax or other laws or government incentive programs; availability and cost of gathering, processing and pipeline systems; retaining or replacing our leadership and key personnel; the availability and cost of capital or borrowing; risks associated with a third-party operating our Eagle Ford properties; risks associated with large projects; costs to develop and operate our properties; public perception and its influence on the regulatory regime; current or future control, legislation or regulations; new regulations on hydraulic fracturing; restrictions on or access to water or other fluids; regulations regarding the disposal of fluids; risks associated with our hedging activities; variations in interest rates and foreign exchange rates; uncertainties associated with estimating oil and natural gas reserves; our inability to fully insure against all risks; additional risks associated with our thermal heavy oil projects; our ability to compete with other organizations in the oil and gas industry; risks associated with our use of information technology systems; results of litigation; that our credit facilities may not provide sufficient liquidity or may not be renewed; failure to comply with the covenants in our debt agreements; risks of counterparty default; the impact of Indigenous claims; risks associated with expansion into new activities; risks associated with the ownership of our securities, including changes in market-based factors; risks for United States and other non-resident shareholders, including the ability to enforce civil remedies, differing practices for reporting reserves and production, additional taxation applicable to non-residents and foreign exchange risk; risk that we may not achieve our guidance and five-year outlook due to various factors; risk that our anticipated drilling plans may change; risk that we may not have sufficient financial resources in the future to allocate to forecasted shareholder returns; risk that our actual results of operations is different from that set forth herein; and other factors, many of which are beyond our control. These and additional risk factors are discussed in our Annual Information Form, Annual Report on Form 40-F and Management's Discussion and Analysis for the year ended December 31, 2023, filed with Canadian securities regulatory authorities and the U.S. Securities and Exchange Commission and in our other public filings.
The future acquisition by Baytex of its shares pursuant to a share buyback program, if any, and the level thereof is uncertain. Any decision to acquire shares of Baytex will be subject to the discretion of the Baytex Board of Directors and may depend on a variety of factors, including, without limitation, Baytex's business performance, financial condition, financial requirements, growth plans, expected capital requirements and other conditions existing at such future time including, without limitation, contractual restrictions, satisfaction of the solvency tests imposed on Baytex under applicable corporate law and receipt of regulatory approvals. There can be no assurance that Baytex will buyback any shares in the future.
The above summary of assumptions and risks related to forward-looking statements has been provided in order to provide shareholders and potential investors with a more complete perspective on Baytex's current and future operations and such information may not be appropriate for other purposes. There is no representation by Baytex that actual results achieved will be the same in whole or in part as those referenced in the forward-looking statements and Baytex does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities law.
This press release contains information, including in respect of our 2025 budget, five-year outlook and 2025 guidance, that may be considered a financial outlook under applicable securities laws about Baytex, which are subject to numerous assumptions, risk factors, limitations and qualifications, including those set forth herein. The actual results will vary from the amounts set forth in this press release and such variations may be material. This information has been provided for illustration only and with respect to future periods are based on budgets and forecasts that are speculative and are subject to a variety of contingencies. The financial outlook contained in this press release was made as of the date of this press release and was included in order to provide readers with a more complete perspective on Baytex's future operations and may not be appropriate for other purposes. Accordingly, these estimates are not to be relied upon as indicative of future results. Except as required by applicable securities laws, Baytex undertakes no obligation to update such financial outlook. Readers are cautioned that the financial outlook contained in this press release is not conclusive and is subject to change.
Dividend Advisory
Future dividends, if any, and the level thereof is uncertain. Any decision to pay dividends on the common shares (including the actual amount, the declaration date, the record date and the payment date) will be subject to the discretion of the Board of Directors of Baytex and may depend on a variety of factors, including, without limitation, Baytex's business performance, financial condition, financial requirements, growth plans, expected capital requirements and other conditions existing at such future time including, without limitation, contractual restrictions and satisfaction of the solvency tests imposed on Baytex under applicable corporate law. There can be no assurance that we will pay dividends in the future. All amounts in this press release are stated in Canadian dollars unless otherwise specified.
Specified Financial Measures
In this press release, we refer to certain specified financial measures (such as free cash flow, average royalty rate, total sales, net of blending and other expense, and return of capital) which do not have any standardized meaning prescribed by IFRS. While these measures are commonly used in the oil and natural gas industry, our determination of these measures may not be comparable with calculations of similar measures presented by other reporting issuers. There are no significant differences in the calculations between historical and forward-looking specified financial measures.
Non-GAAP Financial Measures and Ratios
Free cash flow in this press release may refer to a forward-looking non-GAAP measure that is calculated consistently with the measures disclosed in the Company's Management's Discussion & Analysis ("MD&A"). Cumulative free cash flow is calculated consistently with free cash flow and sums together the forecasted free cash flow during the five-year outlook period (2024-2028). The most directly comparable financial measure for free cash flow disclosed in the Company's primary financial statements is cash flows from operating activities. For the three and nine months ended September 30, 2024, cash flows from operating activities was
Average royalty rate is calculated as royalties divided by total sales, net of blending and other expense which is a non-GAAP measure. Total sales, net of blending and other expense may refer to a forward-looking non-GAAP measure that is calculated consistently with the measures disclosed in the Company's MD&A. The most directly comparable financial measure for total sales, net of blending and other expense disclosed in the Company's primary financial statements is petroleum and natural gas sales. For the three and nine months ended September 30, 2024, petroleum and natural gas sales was
Return of capital is comprised of dividends declared and repurchase of common shares and is used to measure the amount of capital returned to shareholders during a given period. Cumulative return of capital is calculated consistently with return of capital and sums together the forecasted free cash flow during the five-year outlook period (2024-2028). Return of capital in this press release may refer to a forward-looking non-GAAP measure and is calculated consistently with the historical return of capital. Historical return of capital for the three and nine months ended September 30, 2024 and 2023 is calculated below.
| Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Dividends declared | $ | 17,732 | $ | 19,138 | $ | 54,387 | $ | 19,138 | ||||
| Repurchase of common shares | 84,573 | 89,266 | 168,468 | 89,266 | ||||||||
| Return of capital | $ | 102,305 | $ | 108,404 | $ | 222,855 | $ | 108,404 | ||||
Advisory Regarding Oil and Gas Information
Where applicable, oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. The use of boe amounts may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
This press release contains certain oil and gas metrics, including capital efficiencies, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures to evaluate Baytex's performance; however, such measures are not reliable indicators of the future performance and future performance may not compare to the performance in previous periods and therefore such metrics should not be unduly relied upon.
This press release contains certain oil and gas metrics, including capital efficiencies, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures to evaluate Baytex's performance; however, such measures are not reliable indicators of the future performance and future performance may not compare to the performance in previous periods and therefore such metrics should not be unduly relied upon.
Baytex Energy Corp.
Baytex Energy Corp. is an energy company with headquarters based in Calgary, Alberta and offices in Houston, Texas. The company is engaged in the acquisition, development and production of crude oil and natural gas in the Western Canadian Sedimentary Basin and in the Eagle Ford in the United States. Baytex's common shares trade on the Toronto Stock Exchange and the New York Stock Exchange under the symbol BTE.
For further information about Baytex, please visit our website at www.baytexenergy.com or contact:
Brian Ector, Senior Vice President, Capital Markets and Investor Relations
Toll Free Number: 1-800-524-5521
Email: investor@baytexenergy.com
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/232323
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