WHITECAP AND TORC ANNOUNCE STRATEGIC COMBINATION CREATING A LEADING SUSTAINABLE LIGHT OIL FOCUSED COMPANY WITH A SIGNIFICANTLY ENHANCED FREE FUNDS FLOW PROFILE SUPPORTING A 6% DIVIDEND INCREASE
Calgary, December 8, 2020 – Whitecap Assets Inc. (“Whitecap” or the “Firm”) (TSX: WCP) and TORC Oil & Fuel Ltd. (“TORC”) (TSX: TOG) are happy to announce a enterprise mixture (the “Enterprise Mixture”) of two robust vitality franchises leading to a well-capitalized, low decline, gentle oil weighted firm with a gorgeous free funds circulate profile.
Whitecap and TORC have entered right into a enterprise mixture settlement (the “Settlement”) below which the businesses have agreed to mix their companies in an at market, all-stock transaction valued at roughly $900 million, together with TORC’s internet debt, estimated at $335 million as of December 31, 2020. Beneath the phrases of the Settlement, shareholders of TORC (“TORC Shareholders”) will obtain 0.57 Whitecap frequent shares (the “Whitecap Shares”) in trade for every TORC frequent share held (the “TORC Shares”). The at market trade ratio was decided utilizing ten-day quantity weighted common share costs of the Whitecap Shares and the TORC Shares on the Toronto Inventory Change (“TSX”) previous to the signing of the Settlement.
The mixed entity might be stewarded by the prevailing Whitecap govt crew and can proceed to advance a complete return mannequin combining modest manufacturing progress with significant money dividends. The Enterprise Mixture has been unanimously authorized by the Boards of Administrators of each Whitecap and TORC and is predicted to shut on or earlier than February 25, 2021, topic to customary circumstances, together with the receipt of vital regulatory and shareholder approvals.
Strategic and Monetary Advantages of the Enterprise Mixture
Materials Measurement and Scale. Considerably will increase Whitecap’s scale and core space dominance as TORC’s asset base suits instantly into Whitecap’s present core areas creating one of many largest pure play standard gentle oil producers in Canada with over 100,000 boe/d (78% oil and NGLs) of company manufacturing. The mixed entity may have an enterprise worth of roughly $4 billion and has paid $1.4 billion in cumulative dividends to shareholders since inception.
Considerably will increase Whitecap’s scale and core space dominance as TORC’s asset base suits instantly into Whitecap’s present core areas creating one of many largest pure play standard gentle oil producers in Canada with over 100,000 boe/d (78% oil and NGLs) of company manufacturing. The mixed entity may have an enterprise worth of roughly $4 billion and has paid $1.4 billion in cumulative dividends to shareholders since inception. Improved Free Funds Circulation Profile. TORC’s present manufacturing is roughly 25,000 boe/d and its manufacturing in 2021 is predicted to common 22,000 boe/d resulting from a moderated capital program leading to a manufacturing decline charge of lower than 19%. The decrease manufacturing profile is designed to boost the mixed entity’s capacity to generate vital free funds circulate to extend money returns to shareholders. The mixed entity is predicted to have over $300 million of free funds circulate supported by a base manufacturing decline charge of roughly 17%.
TORC’s present manufacturing is roughly 25,000 boe/d and its manufacturing in 2021 is predicted to common 22,000 boe/d resulting from a moderated capital program leading to a manufacturing decline charge of lower than 19%. The decrease manufacturing profile is designed to boost the mixed entity’s capacity to generate vital free funds circulate to extend money returns to shareholders. The mixed entity is predicted to have over $300 million of free funds circulate supported by a base manufacturing decline charge of roughly 17%. Enhanced Lengthy-Time period Shareholder Returns. Return of capital to shareholders continues to be a precedence for Whitecap and is a vital element of its whole return technique. The mixed entity will be capable to generate considerably extra free funds circulate which helps a 6% enhance to the month-to-month dividend from $0.01425 per share to $0.01508 per share ($0.18096 per share annualized). The dividend enhance is predicted to be efficient with the March 2021 dividend payable in April 2021. The professional forma 2021 whole payout ratio is predicted to be 66% at a crude oil worth of US$45/bbl WTI.
Return of capital to shareholders continues to be a precedence for Whitecap and is a vital element of its whole return technique. The mixed entity will be capable to generate considerably extra free funds circulate which helps a 6% enhance to the month-to-month dividend from $0.01425 per share to $0.01508 per share ($0.18096 per share annualized). The dividend enhance is predicted to be efficient with the March 2021 dividend payable in April 2021. The professional forma 2021 whole payout ratio is predicted to be 66% at a crude oil worth of US$45/bbl WTI. Important Synergies. Tangible value financial savings and inventoryoptimization alternatives are anticipated to end in incremental free funds circulate of roughly $15 million in yr one from company and operational synergies within the close to time period.
Tangible value financial savings and stock optimization alternatives are anticipated to end in incremental free funds circulate of roughly $15 million in yr one from company and operational synergies within the close to time period. Prime Tier Steadiness Sheet. The mixed enterprise will keep its robust credit score profile and may have ample liquidity to handle commodity worth volatility. Whitecap’s credit score amenities are covenant based mostly and are usually not topic to yearly credit score determinations. The mixed enterprise is predicted to profit from roughly $6 million in decrease curiosity expense and is predicted to scale back internet debt by over $200 million in 2021, leading to a professional forma debt to EBITDA ratio of 1.8x at US$45/bbl WTI.
The mixed enterprise will keep its robust credit score profile and may have ample liquidity to handle commodity worth volatility. Whitecap’s credit score amenities are covenant based mostly and are usually not topic to yearly credit score determinations. The mixed enterprise is predicted to profit from roughly $6 million in decrease curiosity expense and is predicted to scale back internet debt by over $200 million in 2021, leading to a professional forma debt to EBITDA ratio of 1.8x at US$45/bbl WTI. Sustainable Improvement. Whitecap stays dedicated to best-in-class atmosphere, social and governance (“ESG”) practices and constantly enhancing its ESG profile. Whitecap is the operator of the Weyburn Unit, one of many largest carbon seize and utilization storage initiatives on the earth, at the moment sequestering greater than 2 million tonnes of CO 2 yearly and offering the Firm with its internet detrimental emitter standing.
Whitecap stays dedicated to best-in-class atmosphere, social and governance (“ESG”) practices and constantly enhancing its ESG profile. Whitecap is the operator of the Weyburn Unit, one of many largest carbon seize and utilization storage initiatives on the earth, at the moment sequestering greater than 2 million tonnes of CO yearly and offering the Firm with its internet detrimental emitter standing. Disciplined Management and Governance. The mixed enterprise will proceed to be led by the Whitecap govt crew and Board of Administrators. Pursuant to the Settlement and topic to receipt of approval by the shareholders of Whitecap (“Whitecap Shareholders”) of the decision to amend the articles of Whitecap (the “Article Modification Decision”) on the Whitecap Assembly (as outlined under), Whitecap has agreed to nominate a delegated director from TORC to its Board of Administrators on closing.
Market Main Mild Oil Participant
The strategic enterprise mixture of Whitecap and TORC creates a number one oil weighted producer in Western Canada with a targeted asset base exhibiting decrease manufacturing declines, excessive working netbacks and powerful capital efficiencies.
Grant Fagerheim, Whitecap’s President & CEO, said: “We’re combining two robust Canadian vitality producers to kind a number one large-cap, gentle oil firm geared in direction of producing sustainable long-term returns for shareholders whereas prioritizing accountable Canadian vitality growth. Regardless of the difficult circumstances and vital volatility all year long, we’ve turn into a fair stronger and extra resilient vitality producer getting into 2021 with the mix with TORC in addition to the NAL transaction introduced on August 31, 2020. We want to thank our staff for his or her continued exemplary efforts and our shareholders for his or her ongoing assist. We stay up for advancing returns to our shareholders into the long run.”
There may be vital overlap in Whitecap’s and TORC’s asset bases offering for significant operational synergies and stock optimization alternatives. The mixed enterprise may have 67% of its manufacturing below waterflood restoration, supporting its business main base manufacturing decline charge of 17%.
Brett Herman, TORC’s President & CEO, said, “On behalf of TORC’s administration and Board of Administrators, we want to thank our shareholders for his or her ongoing assist over the previous ten years. We imagine our company values are carefully aligned with Whitecap’s administration crew and the introduced enterprise mixture will create an exceptionally resilient vitality producer that’s positioned for progress, whereas delivering a sustainable dividend to shareholders. In a market atmosphere that’s more and more favouring dimension and scale, a enterprise mixture with Whitecap exposes TORC shareholders to a bigger platform whereas remaining in step with our present philosophy of balancing progress with monetary self-discipline together with prudent capital allocation. We’re happy to turn into shareholders of Whitecap.”
Canada Pension Plan Funding Board (“CPP Investments”) has been a TORC shareholder since 2013 and has entered right into a Assist Settlement whereby it’s going to vote in favour of the transaction underthe phrases of the settlement.
“As a long-standing investor in TORC, we’re happy to assist this transaction, which has compelling financial deserves for each firms and builds a stronger enterprise of scale that may proceed to take part in business consolidation. We might additionally prefer to thank TORC’s administration crew and the Board for his or her work in constructing a powerful vitality franchise,” says Michael Koen, Managing Director, Head of Relationship Investments, CPP Investments.
Preliminary Professional Forma 2021 Outlook
Following the Enterprise Mixture, Whitecap stays effectively positioned to proceed to advance inside growth alternatives and selectively consolidate high-quality property. Whitecap’s aggressive benefits embody a powerful stability sheet, excessive funds circulate netback property, shallow manufacturing decline profile and depth and high quality of stock to assist Whitecap’s totally funded mannequin. Whitecap stays dedicated to rising its enterprise over the long-term together with offering Whitecap Shareholders with significant money returns.
Whitecap’s stand-alone forecasted base case for 2021 (together with the completion of the NAL Transaction, as outlined under), is common manufacturing of 81,000 – 83,000 boe/d on capital investments of $250 – $270 million as press launched on October 29, 2020. The professional forma entity is predicted to have common manufacturing in 2021 of 99,000 – 101,000 boe/d (assuming a deadline of February 25, 2021) on capital investments of $280 to $300 million. Based mostly on this spending and manufacturing profile, Whitecap anticipates producing funds circulate of roughly $602 million with free funds circulate of roughly $312 million and a complete payout ratio of 66% based mostly on commodity costs of US$45/bbl WTI and C$2.50/GJ AECO. An in depth 2021 price range might be supplied on shut of the Enterprise Mixture.
NAL Replace
On August 31, 2020, Whitecap introduced that it had entered into an settlement in an all-stock transaction valued at roughly $155 million with NAL Assets Restricted and a privately held wholly owned subsidiary of Manulife Monetary Company (the “NAL Transaction”). With integration progressing, Whitecap continues to anticipate the shut of the NAL Transaction on January 4, 2021.
Suggestions of the Whitecap and TORC Board of Administrators
The Whitecap Board of Administrators has unanimously decided that the Enterprise Mixture and the execution of the Settlement is in the most effective pursuits of Whitecap, that the consideration to be paid by Whitecap pursuant to the Enterprise Mixture is truthful, from a monetary viewpoint, to Whitecap and has unanimously advisable that the Whitecap Shareholders vote in favour of the decision approving the issuance of the Whitecap Shares pursuant to the Enterprise Mixture (the “Issuance Decision”) on the Whitecap Assembly. Nationwide Financial institution Monetary Inc. has supplied the Whitecap Board with a equity opinion stating that, as of the date thereof and topic to the assumptions, limitations, and {qualifications} set forth therein, the consideration to be paid to the TORC Shareholders is truthful, from a monetary viewpoint, to Whitecap. All the administrators and officers of Whitecap have entered into agreements with TORC pursuant to which they’ve agreed to vote their Whitecap Shares in favour of the Issuance Decision and the Article Modification Decision and in any other case assist the Enterprise Mixture.
The TORC Board of Administrators has unanimously decided that the Enterprise Mixture and the execution of the Settlement is in the most effective pursuits of TORC, that the Enterprise Mixture is truthful to TORC Shareholders and has unanimously advisable that the TORC Shareholders vote in favour of the decision approving the Enterprise Mixture (the “Enterprise Mixture Decision”) on the TORC Assembly (as outlined under). RBC Capital Markets has supplied an opinion to the Board of Administrators of TORC that, as of the date thereof and topic to the assumptions, limitations and {qualifications} set forth therein, the consideration to be obtained below the Transaction is truthful from a monetary viewpoint to the holders of the TORC Shares. TORC’s administration crew and Board of Administrators (“TORC Insiders”) and CPP Investments have all entered into assist agreements with Whitecap and have agreed to vote their TORC Shares in favour of the Enterprise Mixture Decision and in any other case assist the Enterprise Mixture.
Mixture Construction Particulars
Whitecap and TORC have entered into the Settlement to impact the Enterprise Mixture by a plan of association below the Enterprise Companies Act (Alberta). Beneath the phrases of the Enterprise Mixture, Whitecap will purchase all the issued and excellent shares of TORC for share consideration. TORC Shareholders will obtain 0.57 Whitecap Shares for every TORC Share owned. The trade ratio was decided based mostly on the quantity weighted common buying and selling worth of the Whitecap Shares and TORC Shares on the TSX for the previous ten buying and selling days previous to the signing of the Settlement. As a part of the Settlement, Whitecap will assume TORC’s internet debt of $335 million estimated as at December 31, 2020.
TORC Insiders have agreed to enter into maintain interval agreements (“Maintain Interval Agreements”) with Whitecap on the completion of the Enterprise Mixture. The Maintain Interval Agreements will present that, topic to sure exceptions, the TORC Insiders is not going to be entitled to switch or in any other case get rid of the Whitecap Shares they purchase pursuant to the Enterprise Mixture for intervals of three (3), six (6) and 9 (9) months from the deadline of the Enterprise Mixture; one-third of the Whitecap Shares held by the TORC Insiders to be launched after every interval.
The Enterprise Mixture requires approval by a minimum of 66⅔% of the votes solid by TORC Shareholders current in individual or represented by proxy at a particular assembly of TORC Shareholders to be referred to as to think about the Enterprise Mixture (the “TORC Assembly”) and a majority of the votes solid by TORC Shareholders after excluding the votes solid by these individuals whose votes is probably not included below Multilateral Instrument 61-101 – Safety of Minority Safety Holders in Particular Transactions.
The issuance of the Whitecap Shares pursuant to the Enterprise Mixture requires approval by a minimum of 50% of the votes solid by Whitecap Shareholders represented in individual or by proxy at a particular assembly of Whitecap Shareholders (the “Whitecap Assembly”) to be referred to as to think about the Issuance Decision, as required by the principles of the TSX. As well as, Whitecap Shareholders might be requested to think about the Article Modification Decision to extend its most variety of administrators in order that Whitecap can appoint a delegated director from the TORC Board of Administrators to the Whitecap Board of Administrators on closing.
The Settlement contemplates that the Whitecap Assembly and TORC Assembly might be held in February 2021. It’s anticipated {that a} joint administration info round might be despatched to the shareholders of every of Whitecap and TORC in January 2021. Closing of the Enterprise Mixture is predicted to happen on or earlier than February 25, 2021.
The Settlement gives for non-solicitation covenants on behalf of TORC that are topic to the fiduciary obligation obligations of the TORC Board and gives Whitecap with the fitting to match any superior proposal obtained by TORC. The Settlement additionally gives for mutual non-completion charges of $20 million within the occasion the Enterprise Mixture will not be accomplished or is terminated by both celebration in sure circumstances.
The Settlement gives that completion of the Enterprise Mixture is topic to sure circumstances, together with the receipt of all required regulatory approvals, the approval of the TSX, the approval of the shareholders of Whitecap and TORC (as described above), the approval of the Courtroom of Queen’s Bench of Alberta and approval below the Competitors Act (Canada).
Advisors
Nationwide Financial institution Monetary Inc. acted as unique monetary advisor to Whitecap. Burnet, Duckworth & Palmer LLP is appearing as Whitecap’s authorized advisor.
RBC Capital Markets acted as unique monetary advisor to TORC. McCarthy Tétrault LLP is appearing as TORC’s authorized advisor.
Convention Name and Webcast
Whitecap has scheduled a convention name and webcast to start promptly at 10:00 am MT (12:00 Midday ET) on December 9, 2020.
The convention name dial-in quantity is: 1-888-390-0605 or (587) 880-2175 or (416) 764-8609
A dwell webcast of the convention name might be accessible on Whitecap’s web site at www.wcap.ca by deciding on “Traders”, then “Displays & Occasions”. Shortly after the dwell webcast, an archived model might be accessible for roughly 14 days.
For additional info:
Grant Fagerheim, President & CEO
or
Thanh Kang, CFO
Whitecap Assets Inc.
3800, 525 – eighth Avenue SW
Calgary, AB T2P 1G1
(403) 266-0767
www.wcap.ca Brett Herman, President & CEO
or
Jason Zabinsky, VP Finance & CFO
TORC Oil & Fuel Ltd.
1800, 525 – eighth Avenue SW
Calgary, AB T2P 1G1
(403) 930-4120
www.torcoil.co
Notice Concerning Ahead-Trying Statements
This press launch comprises forward-looking statements and forward-looking info (collectively “forward-looking info”) throughout the which means of relevant securities legal guidelines regarding Whitecap and TORC’s present expectations, estimates, projections and assumptions, as relevant, that had been made by every firm in gentle of data accessible on the time the assertion was made. Ahead-looking info sometimes makes use of phrases comparable to “anticipate”, “imagine”, “proceed”, “development”, “maintain”, “venture”, “count on”, “forecast”, “price range”, “purpose”, “steering”, “plan”, “goal”, “technique”, “goal”, “intend”, “estimate”, “potential”, or related phrases suggesting future outcomes, statements that actions, occasions or circumstances “might”, “would”, “may” or “will” be taken or happen sooner or later, together with statements about technique, plans, focus, targets, priorities and place; and the strategic rationale for, and anticipated advantages to be derived from, the Enterprise Mixture. Particularly, and with out limiting the generality of the foregoing, this press launch comprises forward-looking statements with respect to: TORC’s internet debt estimated at $335 million as of December 31, 2020; Whitecap’s capacity proceed to advance a complete return mannequin combining modest manufacturing progress with significant money dividends; the administration crew of the mixed entity; that the Enterprise Mixture is predicted to shut on or earlier than February 25, 2021; common 2021 manufacturing, manufacturing combine and manufacturing decline charge; the anticipated advantages of the Enterprise Mixture, together with: (i) that the Enterprise Mixture will create the biggest pure play standard gentle oil producer in Canada with an enterprise worth of roughly $4 billion, (ii) that the Enterprise Mixture will end in tangible value financial savings and stock optimization alternatives the anticipated advantages to be derived therefrom, (iii) TORC’s anticipated 2021 manufacturing and decline charges, (iv) that the mixed entity is predicted to have over $300 million of free fund circulate; (v) that the Enterprise Mixture will end in a mixed entity that is ready to generate considerably extra free funds circulate and the anticipated advantages to be derived therefrom, (vi) the flexibility of the mixed entity to generate considerably extra free funds circulate which can assist a rise to Whitecap’s dividend of 6% and the timing of the cost, (vii) that the Enterprise Mixture will consequence within the mixed entity having a complete payout ratio of 66% at US$45/bbl WTI, (vii) that the Enterprise Mixture will end in decrease curiosity expense, scale back internet debt and the anticipated advantages therefrom, and (ix) that the Enterprise Mixture will end in decrease manufacturing declines, excessive working netbacks and powerful capital efficiencies; the appointment of a TORC designee to the Whitecap Board of Administrators on closing of the Enterprise Mixture; the execution of the Maintain Interval Agreements with TORC Insiders on closing of the Enterprise Mixture and the phrases and circumstances thereof; the timing of Whitecap Assembly and TORC Assembly; Whitecap’s aggressive benefits embody a powerful stability sheet, excessive funds circulate netback property, shallow manufacturing decline charge and depth and high quality of stock to assist Whitecap’s totally funded mannequin; timing of closing of the NAL Transaction; Whitecap’s capacity to develop its enterprise for the long-term together with offering Whitecap Shareholders with significant money dividends; 2021 common manufacturing and capital investments of the mixed entity; and 2021 funds circulate and free funds circulate.
The forward-looking info is predicated on sure key expectations and assumptions made by every firm, as relevant, together with expectations and assumptions regarding prevailing commodity costs, trade charges, rates of interest, relevant royalty charges and tax legal guidelines; the affect (and the length thereof) that the COVID-19 pandemic may have on (i) the demand for crude oil, NGLs and pure gasoline, (ii) Whitecap’s provide chain, together with its capacity to acquire the tools and providers it requires, and (iii) Whitecap’s capacity to provide, transport and/or promote its crude oil, NGLs and pure gasoline; the flexibility of OPEC+ nations and different main producers of crude oil to scale back crude oil manufacturing and thereby arrest and reverse the steep decline in world crude oil costs; future manufacturing charges and estimates of working prices; efficiency of present and future wells; reserve volumes; anticipated timing and outcomes of capital expenditures; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in finishing up deliberate actions; the timing, location and extent of future drilling operations; the state of the economic system and the exploration and manufacturing enterprise; outcomes of operations; efficiency; enterprise prospects and alternatives; the supply and value of financing, labour and providers; the affect of accelerating competitors; capacity to effectively combine property and staff acquired by acquisitions, capacity to market oil and pure gasoline efficiently; entry to capital; the timing of the completion of the Enterprise Mixture and receipt of relevant regulatory approvals and on the phrases contemplated; and the closing of the NAL Transaction on the timing and phrases and circumstances at the moment contemplated.
Though the expectations and assumptions on which such forward-looking info is predicated are believed to be affordable, undue reliance shouldn’t be positioned on the forward-looking info as a result of no assurance might be on condition that they may show to be right. Since forward-looking info addresses future occasions and circumstances, by its very nature they contain inherent dangers and uncertainties. These embody, however are usually not restricted to: the dangers related to the oil and gasoline business generally comparable to operational dangers in growth, exploration and manufacturing; pandemics and epidemics; delays or modifications in plans with respect to exploration or growth initiatives or capital expenditures; the uncertainty of estimates and projections regarding reserves, manufacturing, prices and bills; well being, security and environmental dangers; commodity worth and trade charge fluctuations; rate of interest fluctuations; advertising and marketing and transportation; lack of markets; environmental dangers; competitors; incorrect evaluation of the worth of acquisitions; failure to finish or notice the anticipated advantages of acquisitions or tendencies; capacity to entry ample capital from inside and exterior sources; failure to acquire required regulatory and different approvals; reliance on third events and pipeline programs; and modifications in laws, together with however not restricted to tax legal guidelines, manufacturing curtailment, royalties and environmental rules. Precise outcomes, efficiency or achievement may differ materially from these expressed in, or implied by, the forward-looking info and, accordingly, no assurance might be on condition that any of the occasions anticipated by the forward-looking info will transpire or happen, or if any of them accomplish that, what advantages that we are going to derive therefrom. The above abstract of assumptions and dangers associated to forward-looking info has been included on this press launch so as to present safety holders with a extra full perspective on future operations and such info is probably not acceptable for different functions.
Except particularly indicated, all forward-looking info with respect to the mixed entity assumes the completion of the NAL Transaction on the phrases and circumstances beforehand publicly introduced by Whitecap.
Readers are cautioned that the foregoing lists of things are usually not exhaustive. Further info on these and different elements that might have an effect on our operations or monetary outcomes are included in reviews on file with relevant securities regulatory authorities and could also be accessed by the SEDAR web site (www.sedar.com).
These forward-looking statements are made as of the date of this press launch and we disclaim any intent or obligation to replace publicly any forward-looking info, whether or not on account of new info, future occasions or outcomes or in any other case, aside from as required by relevant securities legal guidelines.
This press launch comprises future-oriented monetary info and monetary outlook info (collectively, “FOFI”) about Whitecap’s professional forma anticipated incremental funds circulate, dividends, free funds circulate, whole payout ratio, decrease curiosity expense, discount in debt, debt to EBITDA, capital investments, funds circulate and free funds circulate, all of that are topic to the identical assumptions, danger elements, limitations, and {qualifications} as set forth within the above paragraphs. The precise outcomes of operations of Whitecap and the ensuing monetary outcomes will doubtless fluctuate from the quantities set forth on this presentation and such variation could also be materials. Whitecap and its administration imagine that the FOFI has been ready on an affordable foundation, reflecting administration’s greatest estimates and judgments. Nonetheless, as a result of this info is subjective and topic to quite a few dangers, it shouldn’t be relied on as essentially indicative of future outcomes. Besides as required by relevant securities legal guidelines, Whitecap undertakes no obligation to replace such FOFI. FOFI contained on this press launch was made as of the date of this press launch and was supplied for the aim of offering additional details about Whitecap’s anticipated future enterprise operations. Readers are cautioned that the FOFI contained on this press launch shouldn’t be used for functions aside from for which it’s disclosed herein.
Oil and Fuel Advisories
“Boe” means barrel of oil equal based mostly on 6 mcf of pure gasoline to 1 bbl of oil. Boe could also be deceptive, significantly if utilized in isolation. A boe conversion ratio of 6:1 is predicated on an vitality equivalency conversion methodology primarily relevant on the burner tip and doesn’t symbolize a price equivalency on the wellhead. As well as, on condition that the worth ratio based mostly on the present worth of crude oil as in comparison with pure gasoline is considerably totally different from the vitality equivalency of 6:1, using a conversion on a 6:1 foundation could also be deceptive as a sign of worth.
Manufacturing
References to crude oil or pure gasoline manufacturing on this press launch consult with the sunshine and medium crude oil and standard pure gasoline, respectively, product varieties as outlined in Nationwide Instrument 51-101, Requirements of Disclosure for Oil and Fuel Actions.
Disclosure of manufacturing on a per boe foundation on this press launch consists of the constituent product varieties and their respective portions as disclosed within the following desk:
Crude oil (bbls/d) NGLs (bbls/d) Pure gasoline (Mcf/d) Whole (boe/d) TORC Present 21,382 912 16,233 25,000 TORC 2021 Standalone 18,816 803 14,285 22,000 Whitecap 2021 Standalone (1) 53,250 – 54,798 8,203 – 8,334 117,282 – 119,208 81,000 – 83,000 Whitecap 2021 Proforma 68,645 – 70,193 8,860 – 8,991 128,970 – 130,896 99,000 – 101,000
Notice:
(1) Consists of NAL Transaction
Non-GAAP Measures
This press launch consists of non-GAAP measures as additional described herein. These non-GAAP measures wouldn’t have a standardized which means prescribed by Worldwide Monetary Reporting Requirements (“IFRS” or, alternatively, “GAAP”) and, due to this fact, is probably not comparable with the calculation of comparable measures by different firms.
“Enterprise worth” is calculated as market capitalization plus internet debt. Administration believes that enterprise worth gives a helpful measure of the market worth of Whitecap’s debt and fairness.
“Free funds circulate” represents funds circulate much less expenditures on property, plant and tools (“PP&E”). Administration believes that free funds circulate gives a helpful measure of Whitecap’s capacity to extend returns to shareholders and to develop the Firm’s enterprise. Beforehand, Whitecap additionally deducted dividends paid or declared within the calculation of free funds circulate. The Firm believes the change in presentation higher permits comparability with each dividend paying and non-dividend paying friends.
“Market capitalization” is calculated as interval finish share worth multiplied by the variety of shares excellent on the finish of the interval. Administration believes that market capitalization gives a helpful measure of the market worth of Whitecap’s fairness.
“Whole payout ratio” is calculated as dividends paid or declared plus expenditures on PP&E, divided by funds circulate. Administration believes that whole payout ratio gives a helpful measure of Whitecap’s capital reinvestment and dividend coverage, as a proportion of the quantity of funds circulate.
