Welcome!

Microsoft Cloud Authors: Liz McMillan, Elizabeth White, Mihai Corbuleac, Pat Romanski, David Bermingham

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
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
IoT generates lots of temporal data. But how do you unlock its value? How do you coordinate the diverse moving parts that must come together when developing your IoT product? What are the key challenges addressed by Data as a Service? How does cloud computing underlie and connect the notions of Digital and DevOps What is the impact of the API economy? What is the business imperative for Cognitive Computing? Get all these questions and hundreds more like them answered at the 18th Cloud Expo...
As cloud and storage projections continue to rise, the number of organizations moving to the cloud is escalating and it is clear cloud storage is here to stay. However, is it secure? Data is the lifeblood for government entities, countries, cloud service providers and enterprises alike and losing or exposing that data can have disastrous results. There are new concepts for data storage on the horizon that will deliver secure solutions for storing and moving sensitive data around the world. ...
What a difference a year makes. Organizations aren’t just talking about IoT possibilities, it is now baked into their core business strategy. With IoT, billions of devices generating data from different companies on different networks around the globe need to interact. From efficiency to better customer insights to completely new business models, IoT will turn traditional business models upside down. In the new customer-centric age, the key to success is delivering critical services and apps wit...
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discuss how businesses can gain an edge over competitors by empowering consumers to take control through IoT. We'll cite examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He'll also highlight how IoT can revitalize and restore outdated business models, making them profitable...
The essence of data analysis involves setting up data pipelines that consist of several operations that are chained together – starting from data collection, data quality checks, data integration, data analysis and data visualization (including the setting up of interaction paths in that visualization). In our opinion, the challenges stem from the technology diversity at each stage of the data pipeline as well as the lack of process around the analysis.
Designing IoT applications is complex, but deploying them in a scalable fashion is even more complex. A scalable, API first IaaS cloud is a good start, but in order to understand the various components specific to deploying IoT applications, one needs to understand the architecture of these applications and figure out how to scale these components independently. In his session at @ThingsExpo, Nara Rajagopalan is CEO of Accelerite, will discuss the fundamental architecture of IoT applications, ...
SYS-CON Events announced today that ContentMX, the marketing technology and services company with a singular mission to increase engagement and drive more conversations for enterprise, channel and SMB technology marketers, has been named “Sponsor & Exhibitor Lounge Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York. “CloudExpo is a great opportunity to start a conversation with new prospects, but what happens after the...
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device. For more information, please visit https://www.mangoapps.com/.
SYS-CON Events announced today that 24Notion has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. 24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to con...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, will discuss the importance of WebRTC and how it enables companies to fo...
SYS-CON Events announced today TechTarget has been named “Media Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. TechTarget is the Web’s leading destination for serious technology buyers researching and making enterprise technology decisions. Its extensive global networ...
Korean Broadcasting System (KBS) will feature the upcoming 18th Cloud Expo | @ThingsExpo in a New York news documentary about the "New IT for the Future." The documentary will cover how big companies are transmitting or adopting the new IT for the future and will be filmed on the expo floor between June 7-June 9, 2016, at the Javits Center in New York City, New York. KBS has long been a leader in the development of the broadcasting culture of Korea. As the key public service broadcaster of Korea...
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York and Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty ...
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, Containers, 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 opportunity. Submit y...
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will discuss the vast to...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo New York Call for Papers is now open.
SYS-CON Events announced today that Enzu, a leading provider of cloud hosting solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to foc...
SYS-CON Events announced today the How to Create Angular 2 Clients for the Cloud Workshop, being held June 7, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified. Now it’s a component-based well-performing framework. The immersive one-day workshop led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and...