Welcome!

Microsoft Cloud Authors: Janakiram MSV, Pat Romanski, Steven Mandel, John Basso, Liz McMillan

News Feed Item

Bonavista Energy Corporation Announces a Reduction in Monthly Dividends, Closing of a Synergistic Deep Basin Acquisition, Confirmation of the 2013 Capital Budget and Increased Production Guidance

CALGARY, ALBERTA -- (Marketwire) -- 01/09/13 -- Bonavista Energy Corporation (TSX:BNP) ("Bonavista") announces that its Board of Directors has approved a reduction in the monthly dividend from $0.12 per share to $0.07 per share, beginning with the payment due February 15, 2013 to common shareholders of record on January 31, 2013, with an ex-dividend date of January 29, 2013.

Despite encouraging signs of recovery in the fall of 2012, North American natural gas fundamentals have deteriorated significantly since that point. Driven by widespread technological success in the development of natural gas from unconventional reservoirs, the price curve for North American natural gas has shifted materially lower over the past two years. To compound this natural gas supply imbalance, a similar phenomenon has been evolving with the supply of natural gas liquids and crude oil. Unfortunately, producers in western Canada have been exposed to unusually high differential pricing for their product resulting from insufficient export alternatives. The western Canadian oil and gas business will continue to experience excessive pressure throughout 2013 until structural adjustments are realized.

Forward commodity prices are below a level that provides adequate cash flow to sustain our prior monthly dividend, capitalize on our numerous opportunities, and maintain a strong balance sheet. Notwithstanding the implementation of several initiatives to preserve our prior dividend throughout 2012, current forward commodity prices do not allow for these activities to continue under our "dividend plus growth" business model. The long-term goal of this business model remains intact with a commitment to generate an attractive return for our shareholders through a sustainable balance between dividends and corporate growth.

To deliver on this model, Bonavista embarked upon a strategy five years ago to assemble a concentrated portfolio of assets in highly prospective, multi-zone areas that will create maximum value for our shareholders. The approach was to extract incremental value by enhancing both capital and operating efficiencies through control of operations, consolidation and the development of low-risk, scalable opportunities. We have validated our commitment to this strategy over the past twelve months illustrated by acquiring two synergistic assets in our Deep Basin area, and by divesting of numerous non-core properties that were unable to compete for capital allocation. This acquisition and divestiture activity, coupled with our concentrated exploration and development efforts will result in the allocation of greater than 90% of the 2013 capital budget in two areas: the Deep Basin and West Central areas of Alberta. Complementing this focused acquisition and development activity, Bonavista will continue to optimize its asset portfolio and is currently in the process of marketing additional non-core assets for sale with a bidding process due in February 2013.

Today, Bonavista's asset base and drilling inventory is of the highest quality it's been since inception of the company. We have improved the capital efficiency of our key development plays and we continue to find ways to add discipline to our cost structure. Most importantly, we have an experienced, entrepreneurial team driven by profitability and results.

Synergistic Deep Basin Acquisition

Bonavista today completed another synergistic acquisition in its Deep Basin area for a closing purchase price of $72.5 million. This acquisition is consistent with our strategy of acquiring high quality, multi-zone oil and liquids rich natural gas assets in a region proximal to existing operations where we have identified opportunities to optimize netbacks through lowering operating costs and utilizing proven technology to enhance the value of existing reservoirs.

Highlights of the acquisition include:


--  Increases our land position in the Deep Basin by approximately 18%
    (40,000 net acres) providing an excellent overlay with our existing land
    position; 
--  Increases production by 2,450 boe per day (77% natural gas weighted) of
    low decline production with the capability of increasing production by
    350 boe per day by the end of January 2013 through the completion of an
    existing Rock Creek horizontal well; 
--  Adds approximately 12.5 mmboe of proven and probable reserves (54%
    proven); 
--  Increases our development portfolio by 19 gross (17.2 net) horizontal
    drilling locations, nine of which are targeting a Rock Creek light oil
    pool. This pool is currently underdeveloped with less than a 2% recovery
    factor to date, producing at a 15% decline rate. Four horizontal wells
    will be drilled in this pool in 2013; 
--  Adds two wholly-owned natural gas plants with approximately 24 mmcf per
    day of capacity and 130 kilometers of infrastructure augmenting
    Bonavista's existing operational presence in the area. This alignment of
    operations will result in a 25% reduction in the current operating costs
    of these properties; 
--  Adds $20.5 million in net operating income in 2013 with the capability
    of growing substantially in future years; and 
--  Collectively, acquisition metrics are attractive at $29,600 per boe per
    day, $12.00 per boe, including future development costs and 3.5 times
    2013 cash flow based on forward commodity pricing. 

2013 Capital Budget and Upwardly Revised Production Guidance

Bonavista's 2013 net capital spending plans remain consistent with prior guidance at $423 million; however, we have incorporated certain budget adjustments to accommodate approximately $20 million of development expenditures allocated to the Deep Basin properties we have just acquired. We expect our 2013 capital program will result in average production of between 73,500 and 74,500 boe per day representing a modest increase over prior guidance and resulting in 6-7% growth over 2012. Similarly, we expect our 2013 year-end debt to forward 2014 cash flow ratio to improve to 2.0:1 based on current strip commodity pricing.

Through the consistent application of our proven strategy, we are confident that the current measures we are taking will not only result in additional financial flexibility in the short-term but lead to a stronger and more profitable company in the long-term. As in prior years, we will continue to monitor the economic landscape, commodity prices and our drilling results and adjust our capital spending levels as conditions warrant. Additionally, we remain attentive to an increasing number of incremental acquisition opportunities which complement our core regions and enhance our capabilities to create value.

Forward Looking Statements

Corporate information provided herein contains forward-looking information. The reader is cautioned that assumptions used in the preparation of such information, particularly those pertaining to cash dividends, production volumes, commodity prices, operating costs and drilling results, which are considered reasonable by Bonavista at the time of preparation, may be proven to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein and the variations may be material. There is no representation by Bonavista that actual results achieved during the forecast period will be the same in whole or in part as those forecasts.

Contacts:
Keith A. MacPhail
Executive Chairman
(403) 213-4300

Jason E. Skehar
President & CEO
(403) 213-4300

Glenn A. Hamilton
Senior Vice President & CFO
(403) 213-4300

Bonavista Energy Corporation
1500, 525- 8th Avenue SW
Calgary, AB T2P 1G1
www.bonavistaenergy.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Almost two-thirds of companies either have or soon will have IoT as the backbone of their business in 2016. However, IoT is far more complex than most firms expected. How can you not get trapped in the pitfalls? In his session at @ThingsExpo, Tony Shan, a renowned visionary and thought leader, will introduce a holistic method of IoTification, which is the process of IoTifying the existing technology and business models to adopt and leverage IoT. He will drill down to the components in this fra...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, will discuss the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
There is growing need for data-driven applications and the need for digital platforms to build these apps. In his session at 19th Cloud Expo, Muddu Sudhakar, VP and GM of Security & IoT at Splunk, will cover different PaaS solutions and Big Data platforms that are available to build applications. In addition, AI and machine learning are creating new requirements that developers need in the building of next-gen apps. The next-generation digital platforms have some of the past platform needs a...
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
SYS-CON Events announced today Telecom Reseller has been named “Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Telecom Reseller reports on Unified Communications, UCaaS, BPaaS for enterprise and SMBs. They report extensively on both customer premises based solutions such as IP-PBX as well as cloud based and hosted platforms.
Pulzze Systems was happy to participate in such a premier event and thankful to be receiving the winning investment and global network support from G-Startup Worldwide. It is an exciting time for Pulzze to showcase the effectiveness of innovative technologies and enable them to make the world smarter and better. The reputable contest is held to identify promising startups around the globe that are assured to change the world through their innovative products and disruptive technologies. There w...
With so much going on in this space you could be forgiven for thinking you were always working with yesterday’s technologies. So much change, so quickly. What do you do if you have to build a solution from the ground up that is expected to live in the field for at least 5-10 years? This is the challenge we faced when we looked to refresh our existing 10-year-old custom hardware stack to measure the fullness of trash cans and compactors.
The emerging Internet of Everything creates tremendous new opportunities for customer engagement and business model innovation. However, enterprises must overcome a number of critical challenges to bring these new solutions to market. In his session at @ThingsExpo, Michael Martin, CTO/CIO at nfrastructure, outlined these key challenges and recommended approaches for overcoming them to achieve speed and agility in the design, development and implementation of Internet of Everything solutions wi...
Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is expected in the amount of information being processed, managed, analyzed, and acted upon by enterprise IT. This amazing is not part of some distant future - it is happening today. One report shows a 650% increase in enterprise data by 2020. Other estimates are even higher....
Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no id...
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
Smart Cities are here to stay, but for their promise to be delivered, the data they produce must not be put in new siloes. In his session at @ThingsExpo, Mathias Herberts, Co-founder and CTO of Cityzen Data, will deep dive into best practices that will ensure a successful smart city journey.
SYS-CON Events announced today that 910Telecom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - comp...
DevOps at Cloud Expo, taking place Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long dev...
Identity is in everything and customers are looking to their providers to ensure the security of their identities, transactions and data. With the increased reliance on cloud-based services, service providers must build security and trust into their offerings, adding value to customers and improving the user experience. Making identity, security and privacy easy for customers provides a unique advantage over the competition.
I wanted to gather all of my Internet of Things (IOT) blogs into a single blog (that I could later use with my University of San Francisco (USF) Big Data “MBA” course). However as I started to pull these blogs together, I realized that my IOT discussion lacked a vision; it lacked an end point towards which an organization could drive their IOT envisioning, proof of value, app dev, data engineering and data science efforts. And I think that the IOT end point is really quite simple…
Personalization has long been the holy grail of marketing. Simply stated, communicate the most relevant offer to the right person and you will increase sales. To achieve this, you must understand the individual. Consequently, digital marketers developed many ways to gather and leverage customer information to deliver targeted experiences. In his session at @ThingsExpo, Lou Casal, Founder and Principal Consultant at Practicala, discussed how the Internet of Things (IoT) has accelerated our abil...
Is the ongoing quest for agility in the data center forcing you to evaluate how to be a part of infrastructure automation efforts? As organizations evolve toward bimodal IT operations, they are embracing new service delivery models and leveraging virtualization to increase infrastructure agility. Therefore, the network must evolve in parallel to become equally agile. Read this essential piece of Gartner research for recommendations on achieving greater agility.
SYS-CON Events announced today that Venafi, the Immune System for the Internet™ and the leading provider of Next Generation Trust Protection, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Venafi is the Immune System for the Internet™ that protects the foundation of all cybersecurity – cryptographic keys and digital certificates – so they can’t be misused by bad guys in attacks...