CDN NEWS | 
US NEWS 
All financial figures are in Canadian dollars ($ or C$) and all references to barrels are per barrel of bitumen sales unless otherwise noted
CALGARY – MEG Energy Corp. (“MEG” or the “Company”) (TSX: MEG) announced today its preliminary estimates of expected ranges of certain financial and operating data for the three months and year ended December 31, 2019.
The table below presents management’s preliminary estimates, based on the information and data currently available, of expected ranges of certain financial and operating data for the three months and year ended December 31, 2019. The line items in the table for the three months ended December 31, 2019 are estimates and are subject to finalization. Based on estimated results for the fourth quarter of 2019, MEG anticipates achieving results in line with its previously disclosed 2019 guidance.
|
Range of Expected Estimates |
Actual Results |
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|
Year ended |
Three months ended |
Three months ended |
|||||
|
Dec 31, 2019 |
Dec 31, 2019 |
Sep 30, |
Jun 30, |
Mar 31, |
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|
Low |
High |
Low |
High |
||||
|
Production (bbls/d) |
92,750 |
93,250 |
94,000 |
95,000 |
93,278 |
97,288 |
87,133 |
|
Non-Energy Operating Cost (C$/bbl) |
$4.61 |
$4.65 |
$4.43 |
$4.61 |
$4.22 |
$4.53 |
$5.22 |
|
General and Administrative Expenses1 (C$/bbl) |
$1.98 |
$2.00 |
$2.20 |
$2.25 |
$1.66 |
$1.81 |
$2.27 |
|
Capital Expenditures (C$mm) |
$195 |
$200 |
$70 |
$75 |
$40 |
$32 |
$53 |
|
Cash and Cash Equivalents (C$mm) |
$203 |
$209 |
$203 |
$209 |
$154 |
$399 |
$154 |
|
1. $ per barrel based on production. |
Update to MEG 2020 Commodity Price Risk Management Positions
In the fourth quarter of 2019 and the first few days of 2020, MEG entered into additional derivative financial contracts to manage commodity price risk. MEG’s current commodity price risk management contracts, including those entered into in the fourth quarter of 2019 and the first few days of 2020, are summarized below:
|
Forecast Period |
|||||
|
Q1 2020 |
Q2 2020 |
Q3 2020 |
Q4 2020 |
2020 |
|
|
WTI Hedges |
|||||
|
WTI Fixed Price Hedges |
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|
Volume (bbls/d) |
72,899 |
62,395 |
19,043 |
16,887 |
42,806 |
|
Weighted average fixed WTI price (US$/bbl) |
$58.67 |
$59.68 |
$59.38 |
$59.36 |
$59.19 |
|
Enhanced WTI Fixed Price Hedges with Sold Put Options |
|||||
|
Volume (bbls/d) |
– |
– |
16,870 |
24,500 |
10,342 |
|
Weighted average fixed WTI price (US$/bbl) / |
– |
– |
$59.38 / |
$59.11 / $52.00 |
$59.22 / |
|
Total WTI hedge volume (bbls/d) |
72,889 |
62,395 |
35,913 |
41,387 |
53,148 |
|
WTI:WCS Differential Hedges |
|||||
|
Volume2 (bbls/d) |
30,150 |
30,150 |
30,150 |
32,150 |
30,650 |
|
Weighted average fixed WTI:WCS differential at |
($20.14) |
($20.14) |
($20.14) |
($20.01) |
($20.10) |
|
Condensate Hedges |
|||||
|
Volume3 (bbls/d) |
19,149 |
23,298 |
23,208 |
23,208 |
22,216 |
|
Average % of WTI landed in Edmonton (%) |
102% |
101% |
100% |
100% |
101% |
|
1. Includes fixed price swap and sold put option. |
|
2. 2020 includes approximately 13,200 bbls/d of physical forward rail blend sales at a fixed WTI:AWB differential. |
|
3. Q4 2019 and 2020 include approximately 13,300 bbls/d and 7,200 bbls/d (annual average) of physical forward condensate purchases, respectively. Where applicable, the average % of WTI landed in Edmonton includes estimated net transportation costs. |
About MEG
MEG is an oil company focused on sustainable in situ thermal oil development and production in the southern Athabasca region of Alberta, Canada. MEG is actively developing enhanced oil recovery projects that utilize steam-assisted gravity drainage extraction methods to improve the economic recovery of oil as well as lower carbon emissions. MEG transports and sells Access Western Blend to refiners throughout North America and internationally. MEG’s common shares are listed on the Toronto Stock Exchange under the symbol “MEG”.
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