OVV Ovintiv Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 07, 2024

 

 

Ovintiv Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-39191	84-4427672
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
Suite 1700, 370 17th Street
Denver, Colorado				80202
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 303 623-2300

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		OVV		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On May 7, 2024, Ovintiv Inc. (the “Company”) issued a news release announcing its financial and operating results for its first quarter ended March 31, 2024. In connection with this announcement, the Company provided an earnings release and certain selected and supplemental financial information. A copy of the news release and supplemental financial information are attached as Exhibit 99.1 and 99.2 to this Current Report on Form 8-K. The information contained in this report, including Exhibits 99.1 and 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

Item 8.01 Other Events.

In its May 7, 2024 news release, the Company also announced that its Board of Directors had declared a quarterly dividend of $0.30 per share on the Company’s outstanding common stock. The dividend is payable on June 28, 2024 to holders of record at the close of business on June 14, 2024. A copy of the news release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Exhibit Description
Exhibit 99.1	News Release dated May 7, 2024.
Exhibit 99.2	Selected and Supplemental Financial Information.
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	Ovintiv Inc.

 

Date:	May 7, 2024	By:	/s/ Dawna I. Gibb
			Name: Dawna I. Gibb Title: Assistant Corporate Secretary

 

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Ovintiv Reports First Quarter 2024 Financial and Operating Results

Strong Shareholder Returns Underpinned by Continued Operational Excellence

Highlights:

DENVER, May 7, 2024 – Ovintiv Inc. (NYSE, TSX: OVV) (“Ovintiv” or the “Company”) today announced its first quarter 2024 financial and operating results. The Company plans to hold a conference call and webcast at 9:00 a.m. MT (11:00 a.m. ET) on May 8, 2024. Please see dial-in details within this release, as well as additional details on the Company's website at www.ovintiv.com under Presentations and Events – Ovintiv.

“Our solid operational execution continued across the portfolio during the first quarter,” said Ovintiv President and CEO, Brendan McCracken. “Our combination of strong productivity, our leading capital efficiency and a stronger oil price environment have raised our expectations for 2024 Non-GAAP Free Cash Flow from $1.6 billion to $1.9 billion – roughly $750 million more than last year.”

First Quarter 2024 Financial and Operating Results

 

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Guidance

The Company issued its second quarter 2024 guidance and raised its full year production guidance while leaving full year capital guidance unchanged. Full year production volumes are expected to average 560 to 575 MBOE/d, with full year capital investment of $2.2 billion to $2.4 billion.

Guidance Updates		2Q 2024		Full Year 2024
Total Production (MBOE/d)		560 – 575		560 – 575
Oil & Condensate (Mbbls/d)		205 – 209		204 – 208
NGLs (C2 - C4) (Mbbls/d)		89 – 92		88 – 92
Natural Gas (MMcf/d)		1,600 – 1,650		1,600 – 1,650
Capital Investment ($ Millions)		$610 – $650		$2,200 – $2,400

Returns to Shareholders

Ovintiv remains committed to its capital allocation framework, which returns at least 50% of post base dividend Non-GAAP Free Cash Flow to shareholders through buybacks and/or variable dividends.

In the first quarter of 2024, the Company returned $328 million to shareholders through share buybacks totaling $248 million and its base dividend of approximately $80 million. Share buybacks in the second quarter are expected to total approximately $182 million.

Continued Balance Sheet Focus

Ovintiv had approximately $3.0 billion in total liquidity as of March 31, 2024, which included available credit facilities of $3,250 million, available uncommitted demand lines of $237 million, and cash and cash equivalents of $5 million, net of outstanding commercial paper of $495 million.

Ovintiv reported Non-GAAP Debt to EBITDA of 1.3 times and Non-GAAP Debt to Adjusted EBITDA of 1.3 times.

The Company remains committed to maintaining a strong balance sheet and is currently rated investment grade by four credit rating agencies. Ovintiv maintains a long-term leverage target of 1.0 times Non-GAAP Debt to Adjusted EBITDA at mid-cycle prices, with an associated long-term total debt target of $4.0 billion.

Dividend Declared

On May 7, 2024, Ovintiv’s Board declared a quarterly dividend of $0.30 per share of common stock payable on June 28, 2024, to shareholders of record as of June 14, 2024.

Asset Highlights

Permian

Permian production averaged 206 MBOE/d (82% liquids) in the first quarter. The Company had 21 net wells turned in line (“TIL”). Ovintiv plans to invest approximately $1.35 to $1.45 billion in the play in 2024 to bring on 120 to 130 net wells.

Montney

Montney production averaged 226 MBOE/d (19% liquids) in the first quarter. The Company had 11 net wells TIL. Ovintiv plans to invest approximately $425 to $475 million in the play in 2024 to bring on 60 to 70 net wells.

Uinta

Uinta production averaged 28 MBOE/d (79% liquids) in the first quarter. The Company had nine net wells TIL. Ovintiv plans to invest approximately $300 to $350 million in the play in 2024 to bring on 25 to 30 net wells.

Anadarko

Anadarko production averaged 108 MBOE/d (59% liquids) in the first quarter. The Company had no TILs during the quarter. Ovintiv plans to invest approximately $100 to $125 million in the play in 2024 to bring on seven to ten net wells.

2023 Sustainability Report Released

Today, the Company released its 2023 Sustainability Report, highlighting its progress and performance on several key initiatives related to the environment, social responsibility and corporate governance.

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"We are proud of another year of strong performance in 2023," said McCracken. "Our results demonstrate our commitment to developing our resource efficiently and responsibly, while also generating durable returns for our shareholders. We believe that fostering a culture of innovation, engaging with our external stakeholders and workforce, adhering to the highest standards of conduct, and setting measurable near-term targets strengthens our business and drives better corporate outcomes.”

Key Sustainability Highlights

Environment

Social

Governance

Ovintiv's sustainability report can be found on the Company's website at Home – Ovintiv.

For additional information on the Company’s quarterly results, please refer to the First Quarter 2024 Results Presentation available on Ovintiv's website, www.ovintiv.com under Presentations and Events – Ovintiv. Supplemental Information, and Non-GAAP Definitions and Reconciliations, are available on Ovintiv's website under Financial Documents Library.

Conference Call Information

A conference call and webcast to discuss the Company’s first quarter results will be held at 9:00 a.m. MT (11:00 a.m. ET) on May 8, 2024.

To join the conference call without operator assistance, you may register and enter your phone number at https://emportal.ink/3tPPnb2 to receive an instant automated call back. You can also dial direct to be entered to the call by an Operator. Please dial 888-664-6383 (toll-free in North America) or 416-764-8650 (international) approximately 15 minutes prior to the call.

The live audio webcast of the conference call, including slides and financial statements, will be available on Ovintiv's website, www.ovintiv.com under Investors/Presentations and Events. The webcast will be archived for approximately 90 days.

Refer to Note 1 Non-GAAP measures and the tables in this release for reconciliation to comparable GAAP financial measures.

 

 

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Capital Investment and Production

(for the period ended March 31)	1Q 2024	1Q 2023
Capital Expenditures (1)($ millions)	591	610
Oil (Mbbls/d)	170.4	127.3
NGLs – Plant Condensate (Mbbls/d)	40.5	38.7
Oil & Plant Condensate (Mbbls/d)	210.9	166.0
NGLs – Other (Mbbls/d)	88.4	86.2
Total Liquids (Mbbls/d)	299.3	252.2
Natural gas (MMcf/d)	1,648	1,555
Total production (MBOE/d)	573.8	511.4

(1) Including capitalized directly attributable internal costs.

First Quarter Financial Summary

(for the period ended March 31) ($ millions)	1Q 2024	1Q 2023
Cash From (Used In) Operating Activities Deduct (Add Back): Net change in other assets and liabilities Net change in non-cash working capital	659 (12) (364)	1,068 (5) 222
Non-GAAP Cash Flow (1)	1,035	851
Non-GAAP Cash Flow (1)	1,035	851
Less: Capital Expenditures (2)	591	610
Non-GAAP Free Cash Flow (1)	444	241
Net Earnings (Loss) Before Income Tax Before-tax (Addition) Deduction: Unrealized gain (loss) on risk management Non-operating foreign exchange gain (loss)	428 (100) 25	613 18 5
Adjusted Earnings (Loss) Before Income Tax Income tax expense (recovery)	503 114	590 140
Non-GAAP Adjusted Earnings (1)	389	450

(1) Non-GAAP Cash Flow, Non-GAAP Free Cash Flow and Non-GAAP Adjusted Earnings are non-GAAP measures as defined in Note 1.

(2) Including capitalized directly attributable internal costs.

Realized Pricing Summary (Including the impact of realized gains (losses) on risk management)

(for the period ended March 31)	1Q 2024	1Q 2023
Liquids ($/bbl)
WTI	76.96	76.13
Realized Liquids Prices
Oil	75.66	74.06
NGLs – Plant Condensate	68.10	73.01
Oil & Plant Condensate	74.20	73.81
NGLs – Other	21.16	21.11
Total NGLs	35.91	37.19
Natural Gas
NYMEX ($/MMBtu)	2.24	3.42
Realized Natural Gas Price ($/Mcf)	2.56	3.80

 

 

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Cost Summary

 

(for the period ended March 31) ($/BOE)	1Q 2024	1Q 2023
Production, mineral and other taxes	1.60	1.83
Upstream transportation and processing	7.25	9.00
Upstream operating	4.52	4.33
Administrative, excluding long-term incentive and legal costs	1.43	1.52

 

Debt to EBITDA (1)

($ millions, except as indicated)	March 31, 2024	December 31, 2023
Long-Term Debt, including Current Portion	6,198	5,737
Net Earnings (Loss)	1,936	2,085
Add back (Deduct):
Depreciation, depletion and amortization	2,027	1,825
Interest	382	355
Income tax expense (recovery)	389	425
EBITDA	4,734	4,690
Debt to EBITDA (times)	1.3	1.2

Debt to Adjusted EBITDA(1)

($ millions, except as indicated)	March 31, 2024	December 31, 2023
Long-Term Debt, including Current Portion	6,198	5,737
Net Earnings (Loss)	1,936	2,085
Add back (Deduct):
Depreciation, depletion and amortization	2,027	1,825
Accretion of asset retirement obligation	19	19
Interest	382	355
Unrealized (gains) losses on risk management	(76)	(194)
Foreign exchange (gain) loss, net	(6)	19
Other (gains) losses, net	(21)	(20)
Income tax expense (recovery)	389	425
Adjusted EBITDA	4,650	4,514
Debt to Adjusted EBITDA (times)	1.3	1.3

 

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Hedge Details as of March 31, 2024

Oil and Condensate Hedges ($/bbl)	2Q 2024	3Q 2024	4Q 2024	1Q 2025	2Q 2025	3Q 2025	4Q 2025
WTI Swaps	25 Mbbls/d $73.69	0 -	0 -	0 -	0 -	0 -	0 -
WTI Collars Call Strike Put Strike	75 Mbbls/d $80.39 $65.00	10 Mbbls/d $92.06 $60.00	0 - -	0 - -	0 - -	0 - -	0 - -
WTI 3-Way Options Short Call Long Put Short Put	0 - - -	40 Mbbls/d $89.76 $65.00 $50.00	50 Mbbls/d $84.35 $65.00 $50.00	40 Mbbls/d $83.38 $65.00 $50.00	6 Mbbls/d $85.58 $65.00 $50.00	0 - - -	0 - - -

Natural Gas Hedges ($/Mcf)	2Q 2024	3Q 2024	4Q 2024	1Q 2025	2Q 2025	3Q 2025	4Q 2025
NYMEX Swaps	200 MMcf/d $3.62	200 MMcf/d $3.62	200 MMcf/d $3.62	0 -	0 -	0 -	0 -
NYMEX Collars Call Strike Put Strike	400 MMcf/d $3.40 $3.00	400 MMcf/d $3.40 $3.00	400 MMcf/d $5.57 $3.00	0 - -	0 - -	0 - -	0 - -
NYMEX 3-Way Options Call Strike Put Strike Sold Put Strike	200 MMcf/d $4.44 $3.00 $2.25	200 MMcf/d $4.44 $3.00 $2.25	200 MMcf/d $4.58 $3.00 $2.25	500 MMcf/d $4.74 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25	380 MMcf/d $4.38 $3.00 $2.25
Waha % of NYMEX Swaps	50 MMcf/d 71%	50 MMcf/d 71%	50 MMcf/d 71%	0 -	0 -	0 -	0 -
AECO Nominal Basis Swaps	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)	190 MMcf/d ($1.08)
AECO % of NYMEX Swaps	100 MMcf/d 72%	100 MMcf/d 72%	100 MMcf/d 72%	100 MMcf/d 72%	100 MMcf/d 72%	100 MMcf/d 72%	100 MMcf/d 72%

 

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Important information

Ovintiv reports in U.S. dollars unless otherwise noted. Production, sales and reserves estimates are reported on an after-royalties basis, unless otherwise noted. Unless otherwise specified or the context otherwise requires, references to “Ovintiv,” “we,” “its,” “our” or to “the Company” includes reference to subsidiaries of and partnership interests held by Ovintiv Inc. and its subsidiaries.

Please visit Ovintiv’s website and Investor Relations page at www.ovintiv.com and investor.ovintiv.com, where Ovintiv often discloses important information about the Company, its business, and its results of operations.

NI 51-101 Exemption

The Canadian securities regulatory authorities have issued a decision document (the “Decision”) granting Ovintiv exemptive relief from the requirements contained in Canada’s National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). As a result of the Decision, and provided that certain conditions set out in the Decision are met on an on-going basis, Ovintiv will not be required to comply with the Canadian requirements of NI 51-101 and the Canadian Oil and Gas Evaluation Handbook. The Decision permits Ovintiv to provide disclosure in respect of its oil and gas activities in the form permitted by, and in accordance with, the legal requirements imposed by the U.S. Securities and Exchange Commission (“SEC”), the Securities Act of 1933, the Securities and Exchange Act of 1934, the Sarbanes-Oxley Act of 2002 and the rules of the NYSE. The Decision also provides that Ovintiv is required to file all such oil and gas disclosures with the Canadian securities regulatory authorities on www.sedar.com as soon as practicable after such disclosure is filed with the SEC.

NOTE 1: Non-GAAP Measures

Certain measures in this news release do not have any standardized meaning as prescribed by U.S. GAAP and, therefore, are considered non-GAAP measures. These measures may not be comparable to similar measures presented by other companies and should not be viewed as a substitute for measures reported under U.S. GAAP. These measures are commonly used in the oil and gas industry and/or by Ovintiv to provide shareholders and potential investors with additional information regarding the Company’s liquidity and its ability to generate funds to finance its operations. For additional information regarding non-GAAP measures, see the Company’s website. This news release contains references to non-GAAP measures as follows:

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ADVISORY REGARDING OIL AND GAS INFORMATION – The conversion of natural gas volumes to barrels of oil equivalent (BOE) is on the basis of six thousand cubic feet to one barrel. BOE is based on a generic energy equivalency conversion method primarily applicable at the burner tip and does not represent economic value equivalency at the wellhead. Readers are cautioned that BOE may be misleading, particularly if used in isolation.

ADVISORY REGARDING FORWARD-LOOKING STATEMENTS – This news release contains forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, except for statements of historical fact, that relate to the anticipated future activities, plans, strategies, objectives or expectations of the Company, including second quarter and fiscal year 2024 guidance and expected free cash flow, the expectation of delivering sustainable durable returns to shareholders in future years, plans regarding share buybacks and debt reduction, and the anticipated timing of bringing wells online, are forward-looking statements. When used in this news release, the use of words and phrases including “anticipates,” “believes,” “continue,” “could,” “estimates,” “expects,” “focused on,” “forecast,” “guidance,” “intends,” “maintain,” “may,” “opportunities,” “outlook,” “plans,” “potential,” “strategy,” “targets,” “will,” “would” and other similar terminology are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words or phrases. Readers are cautioned against unduly relying on forward-looking statements which, are based on current expectations and by their nature, involve numerous assumptions that are subject to both known and unknown risks and uncertainties (many of which are beyond our control) that may cause such statements not to occur, or actual results to differ materially and/or adversely from those expressed or implied. These assumptions include, without limitation: future commodity prices and basis differentials; the Company's ability to successfully integrate the Midland Basin assets; the ability of the Company to access credit facilities and capital markets; the availability of attractive commodity or financial hedges and the enforceability of risk management programs; the Company's ability to capture and maintain gains in productivity and efficiency; the ability for the Company to generate cash returns and execute on its share buyback plan; expectations of plans, strategies and objectives of the Company, including anticipated production volumes and capital investment; the Company’s ability to manage cost inflation and expected cost structures, including expected operating, transportation, processing and labor expenses; the outlook of the oil and natural gas industry generally, including impacts from changes to the geopolitical environment; and projections made in light of, and generally consistent with, the Company's historical experience and its perception of historical industry trends; and the other assumptions contained herein.

Although the Company believes the expectations represented by its forward-looking statements are reasonable based on the information available to it as of the date such statements are made, forward-looking statements are only predictions and statements of our current beliefs and there can be no assurance that such expectations will prove to be correct. All forward-looking statements contained in this news release are made as of the date of this news release and, except as required by law, the Company undertakes no obligation to update publicly; revise or keep current any forward-looking statements. The forward-looking statements contained or incorporated by reference in this news release, and all subsequent forward-looking statements attributable to the Company, whether written or oral, are expressly qualified by these cautionary statements.

The reader should carefully read the risk factors described in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, and in other filings with the SEC or Canadian securities regulators, for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements. Other unpredictable or unknown factors not discussed in this news release could also have material adverse effects on forward-looking statements.

Further information on Ovintiv Inc. is available on the Company’s website, www.ovintiv.com, or by contacting:

 

Investor contact: (888) 525-0304	Media contact: (403) 645-2252

 

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Condensed Consolidated Statement of Earnings (unaudited)

 

				Three Months Ended
				March 31,
(US$ millions, except per share amounts)				2024				2023
Revenues
Product and service revenues				$	2,387			$	2,592
Gains (losses) on risk management, net					(54	)			(58	)
Sublease revenues					19				17
Total Revenues					2,352				2,551
Operating Expenses
Production, mineral and other taxes					83				84
Transportation and processing					419				455
Operating					243				206
Purchased product					440				701
Depreciation, depletion and amortization					566				364
Accretion of asset retirement obligation					5				5
Administrative					102				58
Total Operating Expenses					1,858				1,873
Operating Income (Loss)					494				678
Other (Income) Expenses
Interest					98				71
Foreign exchange (gain) loss, net					(28	)			(3	)
Other (gains) losses, net					(4	)			(3	)
Total Other (Income) Expenses					66				65
Net Earnings (Loss) Before Income Tax					428				613
Income tax expense (recovery)					90				126
Net Earnings (Loss)				$	338			$	487
Net Earnings (Loss) per Share of Common Stock
Basic				$	1.25			$	1.99
Diluted					1.24				1.97
Weighted Average Shares of Common Stock Outstanding (millions)
Basic					269.7				244.3
Diluted					272.3				247.7

 

Condensed Consolidated Statement of Comprehensive Income (unaudited)

 

				Three Months Ended
				March 31,
(US$ millions)				2024				2023
Net Earnings (Loss)				$	338			$	487
Other Comprehensive Income (Loss), Net of Tax
Foreign currency translation adjustment					(76	)			2
Pension and other post-employment benefit plans					(1	)			(2	)
Other Comprehensive Income (Loss)					(77	)			-
Comprehensive Income (Loss)				$	261			$	487

 

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Condensed Consolidated Balance Sheet (unaudited)

 

				As at				As at
				March 31,				December 31,
(US$ millions)				2024				2023
Assets
Current Assets
Cash and cash equivalents				$	5			$	3
Accounts receivable and accrued revenues (net of allowances
of $5 million (2023: $5 million))					1,270				1,442
Risk management					146				214
Income tax receivable					31				17
					1,452				1,676
Property, Plant and Equipment, at cost:
Oil and natural gas properties, based on full cost accounting
Proved properties					64,586				64,084
Unproved properties					1,340				1,486
Other					905				907
Property, plant and equipment					66,831				66,477
Less: Accumulated depreciation, depletion and amortization					(52,023	)			(51,837	)
Property, plant and equipment, net					14,808				14,640
Other Assets					991				1,015
Risk Management					-				4
Deferred Income Taxes					-				53
Goodwill					2,583				2,599
				$	19,834			$	19,987
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable and accrued liabilities				$	1,920			$	2,209
Current portion of operating lease liabilities					78				87
Income tax payable					10				232
Risk management					30				-
Current portion of long-term debt					745				284
					2,783				2,812
Long-Term Debt					5,453				5,453
Operating Lease Liabilities					818				832
Other Liabilities and Provisions					128				132
Risk Management					8				2
Asset Retirement Obligation					269				276
Deferred Income Taxes					113				110
					9,572				9,617
Shareholders’ Equity
Share capital - authorized 775 million shares of stock
2024 issued and outstanding: 267.6 million shares (2023: 271.7 million shares)					3				3
Paid in surplus					8,331				8,620
Retained earnings (Accumulated deficit)					955				697
Accumulated other comprehensive income					973				1,050
Total Shareholders’ Equity					10,262				10,370
				$	19,834			$	19,987

 

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Condensed Consolidated Statement of Cash Flows (unaudited)

 

				Three Months Ended
				March 31,
(US$ millions)				2024				2023
Operating Activities
Net earnings (loss)				$	338			$	487
Depreciation, depletion and amortization					566				364
Accretion of asset retirement obligation					5				5
Deferred income taxes					58				64
Unrealized (gain) loss on risk management					100				(18	)
Unrealized foreign exchange (gain) loss					(23	)			(5	)
Foreign exchange (gain) loss on settlements					(2	)			(1	)
Other					(7	)			(45	)
Net change in other assets and liabilities					(12	)			(5	)
Net change in non-cash working capital					(364	)			222
Cash From (Used in) Operating Activities					659				1,068
Investing Activities
Capital expenditures					(591	)			(610	)
Acquisitions					(190	)			(199	)
Corporate acquisition					12				-
Proceeds from divestitures					2				12
Net change in investments and other					6				(66	)
Cash From (Used in) Investing Activities					(761	)			(863	)
Financing Activities
Net issuance (repayment) of revolving debt					461				187
Purchase of shares of common stock					(250	)			(239	)
Dividends on shares of common stock					(80	)			(61	)
Finance lease payments and other					(29	)			(71	)
Cash From (Used in) Financing Activities					102				(184	)
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents
and Restricted Cash Held in Foreign Currency					2				-
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash					2				21
Cash, Cash Equivalents and Restricted Cash, Beginning of Year					3				5
Cash, Cash Equivalents and Restricted Cash, End of Period				$	5			$	26
Cash, End of Period				$	3			$	6
Cash Equivalents, End of Period					2				20
Restricted Cash, End of Period					-				-
Cash, Cash Equivalents and Restricted Cash, End of Period				$	5			$	26

 

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Supplemental Financial Information (unaudited)

 

Financial Results

						2024				2023
(US$ millions, unless otherwise specified)						Q1				Year			Q4			Q3			Q2			Q1
Net Earnings (Loss)							338				2,085			856			406			336			487
	Per share - basic (1)						1.25				8.02			3.14			1.48			1.35			1.99
	Per share - diluted (1)						1.24				7.90			3.11			1.47			1.34			1.97
Non-GAAP Adjusted Earnings (2)							389				1,810			647			481			232			450
	Per share - basic (1)						1.44				6.96			2.38			1.76			0.93			1.84
	Per share - diluted (1)						1.43				6.86			2.35			1.74			0.93			1.82
Non-GAAP Cash Flow (3)							1,035				3,899			1,237			1,112			699			851
	Per share - basic (1)						3.84				15.00			4.54			4.06			2.80			3.48
	Per share - diluted (1)						3.80				14.77			4.49			4.02			2.79			3.44
Foreign Exchange Rates (C$ per US$1)
	Average						1.349				1.350			1.362			1.341			1.343			1.353
	Period end						1.355				1.323			1.323			1.352			1.324			1.353
Non-GAAP Adjusted Earnings Summary
Net Earnings (Loss) Before Income Tax							428				2,510			1,067			393			437			613
Before-tax (Addition) Deduction:
	Unrealized gain (loss) on risk management						(100	)			194			326			(292	)		142			18
	Non-operating foreign exchange gain (loss)						25				(2	)		(9	)		17			(15	)		5
Adjusted Earnings (Loss) Before Income Tax							503				2,318			750			668			310			590
	Income tax expense (recovery) (4)						114				508			103			187			78			140
Non-GAAP Adjusted Earnings (2)							389				1,810			647			481			232			450
Non-GAAP Cash Flow Summary
Cash From (Used in) Operating Activities							659				4,167			1,362			906			831			1,068
(Add back) Deduct:
	Net change in other assets and liabilities						(12	)			(62	)		(31	)		(14	)		(12	)		(5	)
	Net change in non-cash working capital						(364	)			330			156			(192	)		144			222
Non-GAAP Cash Flow (3)							1,035				3,899			1,237			1,112			699			851

 

(1) Net Earnings (Loss), Non-GAAP Adjusted Earnings and Non-GAAP Cash Flow per share are calculated using the weighted average number of shares of common stock outstanding as follows:

							2024				2023
	(millions)						Q1				Year			Q4			Q3			Q2			Q1
	Weighted Average Shares of Common Stock Outstanding
		Basic						269.7				259.9			272.3			273.7			249.4			244.3
		Diluted						272.3				263.9			275.4			276.3			250.8			247.7

(2) Non-GAAP Adjusted Earnings is a non-GAAP measure defined as net earnings (loss) excluding non-cash items that Management believes reduces the comparability of the Company’s financial performance between periods. These items may include, but are not limited to, unrealized gains/losses on risk management, impairments, non‑operating foreign exchange gains/losses, and gains/losses on divestitures. Income taxes includes adjustments to normalize the effect of income taxes calculated using the estimated annual effective income tax rate. In addition, any valuation allowances are excluded in the calculation of income taxes.

(3) Non-GAAP Cash Flow is a non-GAAP measure defined as cash from (used in) operating activities excluding net change in other assets and liabilities, and net change in non-cash working capital.

(4) Calculated using the applicable U.S. federal and state statutory income tax rate of 21.75 percent and the applicable Canadian federal and provincial statutory income tax rate of 23.7 percent (2023 - 23.0 percent and 23.7 percent, respectively).

 

Financial Metrics

2024

2023

Q1

Year

Debt to Capitalization

38%

36%

Debt to Adjusted Capitalization (1)

26%

24%

Debt to EBITDA (1)

1.3x

1.2x

Debt to Adjusted EBITDA (1)

1.3x

1.3x

 

(1) Debt to Adjusted Capitalization, Debt to EBITDA and Debt to Adjusted EBITDA are non-GAAP measures monitored by Management as indicators of the Company’s overall financial strength. Non-GAAP measures are defined and calculated in the Non-GAAP Definitions and Reconciliations document following this Supplemental Information report.

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Supplemental Operating Information (unaudited)

 

Production Volumes by Product

										2024				2023
(average)		% of Oil & NGLs								Q1				Year			Q4			Q3			Q2			Q1
	Oil (Mbbls/d)							57			170.4				158.9			194.1			170.9			142.4			127.3
	NGLs - Plant Condensate (Mbbls/d)							13			40.5				42.9			46.1			43.3			43.5			38.7
Oil & Plant Condensate (Mbbls/d)								70			210.9				201.8			240.2			214.2			185.9			166.0
	Butane (Mbbls/d)							7			20.6				21.1			21.7			20.4			23.2			19.1
	Propane (Mbbls/d)							12			34.0				33.7			35.2			33.2			34.9			31.3
	Ethane (Mbbls/d)							11			33.8				35.4			34.0			33.1			38.7			35.8
NGLs - Other (Mbbls/d)								30			88.4				90.2			90.9			86.7			96.8			86.2
Oil & NGLs (Mbbls/d)								100			299.3				292.0			331.1			300.9			282.7			252.2
Natural Gas (MMcf/d)											1,648				1,642			1,645			1,625			1,743			1,555
Total (MBOE/d)											573.8				565.6			605.2			571.8			573.0			511.4

 

Production Volumes by Segment

								2024				2023
(average)								Q1				Year			Q4			Q3			Q2			Q1
Oil (Mbbls/d)
	USA Operations								170.2				158.8			194.0			170.8			142.4			127.2
	Canadian Operations								0.2				0.1			0.1			0.1			-			0.1
									170.4				158.9			194.1			170.9			142.4			127.3
NGLs - Plant Condensate (Mbbls/d)
	USA Operations								10.6				10.9			11.3			11.2			10.5			10.6
	Canadian Operations								29.9				32.0			34.8			32.1			33.0			28.1
									40.5				42.9			46.1			43.3			43.5			38.7
Oil & Plant Condensate (Mbbls/d)
	USA Operations								180.8				169.7			205.3			182.0			152.9			137.8
	Canadian Operations								30.1				32.1			34.9			32.2			33.0			28.2
									210.9				201.8			240.2			214.2			185.9			166.0
NGLs - Other (Mbbls/d)
	USA Operations								74.6				74.6			74.6			71.8			78.1			73.7
	Canadian Operations								13.8				15.6			16.3			14.9			18.7			12.5
									88.4				90.2			90.9			86.7			96.8			86.2
NGLs - Total (Mbbls/d)
	USA Operations								85.2				85.5			85.9			83.0			88.6			84.3
	Canadian Operations								43.7				47.6			51.1			47.0			51.7			40.6
									128.9				133.1			137.0			130.0			140.3			124.9
Oil & NGLs (Mbbls/d)
	USA Operations								255.4				244.3			279.9			253.8			231.0			211.5
	Canadian Operations								43.9				47.7			51.2			47.1			51.7			40.7
									299.3				292.0			331.1			300.9			282.7			252.2
Natural Gas (MMcf/d)
	USA Operations								526				517			524			508			530			507
	Canadian Operations								1,122				1,125			1,121			1,117			1,213			1,048
									1,648				1,642			1,645			1,625			1,743			1,555
Total (MBOE/d)
	USA Operations								343.0				330.4			367.1			338.5			319.2			296.1
	Canadian Operations								230.8				235.2			238.1			233.3			253.8			215.3
									573.8				565.6			605.2			571.8			573.0			511.4

 

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Supplemental Financial & Operating Information (unaudited)

 

Results of Operations

Revenues and Realized Gains (Losses) on Risk Management

						2024				2023
(US$ millions)						Q1				Year			Q4			Q3			Q2			Q1
USA Operations
Revenues, excluding Realized Gains (Losses) on Risk Management (1)
	Oil						1,177				4,431			1,372			1,267			944			848
	NGLs (2)						187				676			170			174			149			183
	Natural Gas						97				458			114			103			86			155
							1,461				5,565			1,656			1,544			1,179			1,186
Realized Gains (Losses) on Risk Management (3)
	Oil						(8	)			(24	)		(5	)		(19	)		-			-
	NGLs (2)						1				-			-			-			-			-
	Natural Gas						31				33			11			15			5			2
							24				9			6			(4	)		5			2
Canadian Operations
Revenues, excluding Realized Gains (Losses) on Risk Management (1)
	Oil						1				3			1			2			-			-
	NGLs (2)						233				1,023			284			258			245			236
	Natural Gas						234				1,186			267			244			222			453
							468				2,212			552			504			467			689
Realized Gains (Losses) on Risk Management (3)
	Oil						-				-			-			-			-			-
	NGLs (2)						-				1			1			-			-			-
	Natural Gas						22				(54	)		11			13			-			(78	)
							22				(53	)		12			13			-			(78	)

 

(1) Excludes other revenues with no associated production volumes, but includes intercompany marketing fees transacted between the Company’s operating segments.

(2) Includes plant condensate.

(3) Excludes realized gains or losses from other derivative contracts with no associated production volumes and foreign exchange risk management positions.

 

 

---

Supplemental Financial & Operating Information (unaudited)

 

Results of Operations (continued)

Per-Unit Results, Excluding the Impact of Realized Gains (Losses) on Risk Management (1)

						2024					2023
(US$/BOE)							Q1				Year			Q4			Q3			Q2			Q1
Total USA Operations Netback
	Price							46.85				46.15			49.03			49.62			40.56			44.52
	Production, mineral and other taxes							2.56				2.71			2.65			2.71			2.49			3.01
	Transportation and processing							4.07				4.54			3.80			3.98			5.10			5.51
	Operating							6.77				6.15			5.85			6.66			5.73			6.39
	Netback							33.45				32.75			36.73			36.27			27.24			29.61
Total Canadian Operations Netback
	Price							22.30				25.76			25.21			23.46			20.26			35.50
	Production, mineral and other taxes							0.17				0.18			0.16			0.24			0.14			0.19
	Transportation and processing							11.96				12.29			11.65			12.36			11.57			13.80
	Operating							1.19				1.04			1.38			1.30			0.10			1.50
	Netback							8.98				12.25			12.02			9.56			8.45			20.01
Total Operations Netback
	Price							36.97				37.67			39.66			38.95			31.56			40.72
	Production, mineral and other taxes							1.60				1.66			1.67			1.70			1.43			1.83
	Transportation and processing							7.25				7.76			6.89			7.40			7.97			9.00
	Operating							4.52				4.03			4.09			4.48			3.23			4.33
	Netback							23.60				24.22			27.01			25.37			18.93			25.56

 

(1) Netback is a common metric used in the oil and gas industry to measure operating performance on a per-unit basis and is considered a non-GAAP measure. The netbacks disclosed above have been calculated on a BOE basis using upstream product revenues, excluding the impact of realized gains and losses on risk management, less costs associated with delivering the product to market, including production, mineral and other taxes, transportation and processing expense and operating expense. For additional information regarding non-GAAP measures, including Netback reconciliations, see the Non-GAAP Definitions and Reconciliations document following this Supplemental Information report.

 

Other Per-unit Results

						2024					2023
(US$/BOE)							Q1				Year			Q4			Q3			Q2			Q1
Administrative Expense								1.95				1.91			1.57			1.53			3.23			1.25
Administrative Expense, Excluding Long-Term Incentive,
	Transaction and Legal Costs (1)							1.43				1.35			1.36			1.27			1.28			1.52

 

(1) Transaction costs refer to costs primarily incurred to facilitate the Permian Acquisition as defined in Note 9 of the Interim Condensed Consolidated Financial Statements included in Part I, Item 1 of Ovintiv’s Quarterly Report on Form 10-Q.

 

---

Supplemental Oil and Gas Operating Statistics (unaudited)

 

Operating Statistics

Per-Unit Prices, Excluding the Impact of Realized Gains (Losses) on Risk Management

						2024				2023
(US$)						Q1				Year			Q4			Q3			Q2			Q1
Oil Price ($/bbl)
	USA Operations						76.17				76.46			76.91			80.69			72.83			74.06
	Canadian Operations						72.34				81.59			75.10			100.64			-			71.44
	Total Operations						76.17				76.46			76.91			80.70			72.83			74.06
NGLs - Plant Condensate Price ($/bbl)
	USA Operations						57.97				58.53			57.24			59.96			55.09			61.84
	Canadian Operations						71.70				74.52			74.65			75.67			70.99			77.22
	Total Operations						68.10				70.46			70.38			71.61			67.14			73.01
Oil & Plant Condensate Price ($/bbl)
	USA Operations						75.10				75.31			75.83			79.42			71.61			73.12
	Canadian Operations						71.71				74.54			74.65			75.75			70.99			77.21
	Total Operations						74.62				75.19			75.66			78.86			71.50			73.81
NGLs - Other Price ($/bbl)
	USA Operations						19.35				16.27			16.21			16.91			13.43			18.73
	Canadian Operations						30.13				26.78			30.94			25.50			18.62			35.17
	Total Operations						21.03				18.09			18.85			18.39			14.43			21.11
NGLs - Total Price ($/bbl)
	USA Operations						24.16				21.66			21.61			22.72			18.39			24.14
	Canadian Operations						58.59				58.89			60.71			59.76			52.05			64.31
	Total Operations						35.82				34.98			36.20			36.11			30.78			37.19
Oil & NGLs Price ($/bbl)
	USA Operations						58.79				57.29			59.94			61.73			51.94			54.16
	Canadian Operations						58.65				58.93			60.75			59.84			52.06			64.32
	Total Operations						58.77				57.55			60.06			61.43			51.96			55.80
Natural Gas Price ($/Mcf)
	USA Operations						2.02				2.43			2.34			2.22			1.79			3.40
	Canadian Operations						2.30				2.89			2.58			2.38			2.02			4.80
	Total Operations						2.21				2.74			2.50			2.33			1.95			4.34
Total Price ($/BOE)
	USA Operations						46.85				46.15			49.03			49.62			40.56			44.52
	Canadian Operations						22.30				25.76			25.21			23.46			20.26			35.50
	Total Operations						36.97				37.67			39.66			38.95			31.56			40.72

 

---

Supplemental Oil and Gas Operating Statistics (unaudited)

 

Operating Statistics (continued)

Per-unit Impact of Realized Gains (Losses) on Risk Management

						2024				2023
(US$)						Q1				Year			Q4			Q3			Q2			Q1
Oil ($/bbl)
	USA Operations						(0.51	)			(0.40	)		(0.27	)		(1.18	)		-			-
	Canadian Operations						-				-			-			-			-			-
	Total Operations						(0.51	)			(0.40	)		(0.27	)		(1.18	)		-			-
NGLs - Plant Condensate ($/bbl)
	USA Operations						-				-			-			-			-			-
	Canadian Operations						-				0.09			0.10			-			-			-
	Total Operations						-				0.05			0.08			-			-			-
Oil & Plant Condensate ($/bbl)
	USA Operations						(0.48	)			(0.38	)		(0.25	)		(1.12	)		-			-
	Canadian Operations						-				-			-			-			-			-
	Total Operations						(0.42	)			(0.31	)		(0.20	)		(0.92	)		-			-
NGLs - Other ($/bbl)
	USA Operations						0.15				-			-			-			-			-
	Canadian Operations						-				-			-			-			-			-
	Total Operations						0.13				-			-			-			-			-
NGLs - Total ($/bbl)
	USA Operations						0.13				-			-			-			-			-
	Canadian Operations						-				-			-			-			-			-
	Total Operations						0.09				-			-			-			-			-
Oil & NGLs ($/bbl)
	USA Operations						(0.30	)			(0.27	)		(0.19	)		(0.80	)		-			-
	Canadian Operations						-				-			-			-			-			-
	Total Operations						(0.26	)			(0.21	)		(0.14	)		(0.66	)		-			-
Natural Gas ($/Mcf)
	USA Operations						0.65				0.17			0.23			0.32			0.10			0.03
	Canadian Operations						0.22				(0.13	)		0.11			0.12			-			(0.82	)
	Total Operations						0.35				(0.03	)		0.15			0.18			0.03			(0.54	)
Total ($/BOE)
	USA Operations						0.77				0.07			0.18			(0.12	)		0.17			0.05
	Canadian Operations						1.03				(0.60	)		0.56			0.60			-			(3.97	)
	Total Operations						0.87				(0.21	)		0.33			0.17			0.10			(1.64	)

 

---

Supplemental Oil and Gas Operating Statistics (unaudited)

 

Operating Statistics (continued)

Per-Unit Results, Including the Impact of Realized Gains (Losses) on Risk Management

						2024				2023
(US$)						Q1				Year			Q4			Q3			Q2			Q1
Oil Price ($/bbl)
	USA Operations						75.66				76.06			76.64			79.51			72.83			74.06
	Canadian Operations						72.34				81.59			75.10			100.64			-			71.44
	Total Operations						75.66				76.06			76.64			79.52			72.83			74.06
NGLs - Plant Condensate Price ($/bbl)
	USA Operations						57.97				58.53			57.24			59.96			55.09			61.84
	Canadian Operations						71.70				74.61			74.75			75.67			70.99			77.22
	Total Operations						68.10				70.51			70.46			71.61			67.14			73.01
Oil & Plant Condensate Price ($/bbl)
	USA Operations						74.62				74.93			75.58			78.30			71.61			73.12
	Canadian Operations						71.71				74.54			74.65			75.75			70.99			77.21
	Total Operations						74.20				74.88			75.46			77.94			71.50			73.81
NGLs - Other Price ($/bbl)
	USA Operations						19.50				16.27			16.21			16.91			13.43			18.73
	Canadian Operations						30.13				26.78			30.94			25.50			18.62			35.17
	Total Operations						21.16				18.09			18.85			18.39			14.43			21.11
NGLs - Total Price ($/bbl)
	USA Operations						24.29				21.66			21.61			22.72			18.39			24.14
	Canadian Operations						58.59				58.89			60.71			59.76			52.05			64.31
	Total Operations						35.91				34.98			36.20			36.11			30.78			37.19
Oil & NGLs Price ($/bbl)
	USA Operations						58.49				57.02			59.75			60.93			51.94			54.16
	Canadian Operations						58.65				58.93			60.75			59.84			52.06			64.32
	Total Operations						58.51				57.34			59.92			60.77			51.96			55.80
Natural Gas Price ($/Mcf)
	USA Operations						2.67				2.60			2.57			2.54			1.89			3.43
	Canadian Operations						2.52				2.76			2.69			2.50			2.02			3.98
	Total Operations						2.56				2.71			2.65			2.51			1.98			3.80
Total Price ($/BOE)
	USA Operations						47.62				46.22			49.21			49.50			40.73			44.57
	Canadian Operations						23.33				25.16			25.77			24.06			20.26			31.53
	Total Operations						37.84				37.46			39.99			39.12			31.66			39.08
Total Netback ($/BOE)
	USA Operations						34.22				32.82			36.91			36.15			27.41			29.66
	Canadian Operations						10.01				11.65			12.58			10.16			8.45			16.04
	Total Operations						24.47				24.01			27.34			25.54			19.03			23.92

 

---

Supplemental Oil and Gas Operating Statistics (unaudited)

 

Results by Play

							2024				2023
(average)							Q1				Year			Q4			Q3			Q2			Q1
Oil Production (Mbbls/d)
USA Operations
	Permian							124.9				99.5			140.2			121.4			75.6			59.6
	Anadarko							24.4				30.6			26.8			30.2			32.4			33.1
	Uinta							20.8				19.1			26.8			18.9			17.8			12.8
	Other (1)							0.1				9.6			0.2			0.3			16.6			21.7
Total USA Operations								170.2				158.8			194.0			170.8			142.4			127.2
Canadian Operations
	Montney							0.2				0.1			0.1			0.1			-			0.1
	Other (1)							-				-			-			-			-			-
Total Canadian Operations								0.2				0.1			0.1			0.1			-			0.1
Total								170.4				158.9			194.1			170.9			142.4			127.3
NGLs - Plant Condensate Production (Mbbls/d)
USA Operations
	Permian							4.7				4.1			4.9			4.6			3.7			3.0
	Anadarko							5.6				5.9			6.0			6.1			5.6			5.8
	Uinta							0.3				0.3			0.4			0.4			0.2			0.2
	Other (1)							-				0.6			-			0.1			1.0			1.6
Total USA Operations								10.6				10.9			11.3			11.2			10.5			10.6
Canadian Operations
	Montney							29.8				32.0			34.8			32.1			33.0			28.1
	Other (1)							0.1				-			-			-			-			-
Total Canadian Operations								29.9				32.0			34.8			32.1			33.0			28.1
Total								40.5				42.9			46.1			43.3			43.5			38.7
Oil & Plant Condensate Production (Mbbls/d)
USA Operations
	Permian							129.6				103.6			145.1			126.0			79.3			62.6
	Anadarko							30.0				36.5			32.8			36.3			38.0			38.9
	Uinta							21.1				19.4			27.2			19.3			18.0			13.0
	Other (1)							0.1				10.2			0.2			0.4			17.6			23.3
Total USA Operations								180.8				169.7			205.3			182.0			152.9			137.8
Canadian Operations
	Montney							30.0				32.1			34.9			32.2			33.0			28.2
	Other (1)							0.1				-			-			-			-			-
Total Canadian Operations								30.1				32.1			34.9			32.2			33.0			28.2
Total								210.9				201.8			240.2			214.2			185.9			166.0

 

(1) Other Operations includes production volumes from plays that are not part of the Company’s current focus. Production volumes associated with Bakken were included in USA Other Operations until the asset was divested on June 12, 2023.

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Supplemental Oil and Gas Operating Statistics (unaudited)

 

Results by Play (continued)

							2024				2023
(average)							Q1				Year			Q4			Q3			Q2			Q1
NGLs - Other Production (Mbbls/d)
USA Operations
	Permian							40.3				33.0			39.0			35.1			31.0			26.8
	Anadarko							32.9				36.3			33.7			35.2			37.8			38.5
	Uinta							1.3				1.2			1.8			1.2			1.1			0.7
	Other (1)							0.1				4.1			0.1			0.3			8.2			7.7
Total USA Operations								74.6				74.6			74.6			71.8			78.1			73.7
Canadian Operations
	Montney							13.8				15.6			16.3			14.9			18.7			12.5
	Other (1)							-				-			-			-			-			-
Total Canadian Operations								13.8				15.6			16.3			14.9			18.7			12.5
Total								88.4				90.2			90.9			86.7			96.8			86.2
NGLs - Total Production (Mbbls/d)
USA Operations
	Permian							45.0				37.1			43.9			39.7			34.7			29.8
	Anadarko							38.5				42.2			39.7			41.3			43.4			44.3
	Uinta							1.6				1.5			2.2			1.6			1.3			0.9
	Other (1)							0.1				4.7			0.1			0.4			9.2			9.3
Total USA Operations								85.2				85.5			85.9			83.0			88.6			84.3
Canadian Operations
	Montney							43.6				47.6			51.1			47.0			51.7			40.6
	Other (1)							0.1				-			-			-			-			-
Total Canadian Operations								43.7				47.6			51.1			47.0			51.7			40.6
Total								128.9				133.1			137.0			130.0			140.3			124.9
Oil & NGLs Production (Mbbls/d)
USA Operations
	Permian							169.9				136.6			184.1			161.1			110.3			89.4
	Anadarko							62.9				72.8			66.5			71.5			75.8			77.4
	Uinta							22.4				20.6			29.0			20.5			19.1			13.7
	Other (1)							0.2				14.3			0.3			0.7			25.8			31.0
Total USA Operations								255.4				244.3			279.9			253.8			231.0			211.5
Canadian Operations
	Montney							43.8				47.7			51.2			47.1			51.7			40.7
	Other (1)							0.1				-			-			-			-			-
Total Canadian Operations								43.9				47.7			51.2			47.1			51.7			40.7
Total								299.3				292.0			331.1			300.9			282.7			252.2

 

(1) Other Operations includes production volumes from plays that are not part of the Company’s current focus. Production volumes associated with Bakken were included in USA Other Operations until the asset was divested on June 12, 2023.

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Supplemental Oil and Gas Operating Statistics (unaudited)

 

Results by Play (continued)

							2024				2023
(average)							Q1				Year			Q4			Q3			Q2			Q1
Natural Gas Production (MMcf/d)
USA Operations
	Permian							220				185			213			195			171			158
	Anadarko							267				283			277			285			289			281
	Uinta							36				22			30			24			20			15
	Other (1)							3				27			4			4			50			53
Total USA Operations								526				517			524			508			530			507
Canadian Operations
	Montney							1,093				1,095			1,094			1,092			1,177			1,017
	Other (1)							29				30			27			25			36			31
Total Canadian Operations								1,122				1,125			1,121			1,117			1,213			1,048
Total								1,648				1,642			1,645			1,625			1,743			1,555
Total Production (MBOE/d)
USA Operations
	Permian							206.3				167.3			219.5			193.9			138.9			115.8
	Anadarko							107.5				119.9			112.8			119.0			124.0			124.2
	Uinta							28.4				24.3			33.9			24.4			22.4			16.3
	Other (1)							0.8				18.9			0.9			1.2			33.9			39.8
Total USA Operations								343.0				330.4			367.1			338.5			319.2			296.1
Canadian Operations
	Montney							225.8				230.2			233.6			229.1			247.8			210.1
	Other (1)							5.0				5.0			4.5			4.2			6.0			5.2
Total Canadian Operations								230.8				235.2			238.1			233.3			253.8			215.3
Total								573.8				565.6			605.2			571.8			573.0			511.4

 

(1) Other Operations includes total production volumes from plays that are not part of the Company’s current focus. Production volumes associated with Bakken were included in USA Other Operations until the asset was divested on June 12, 2023. Canadian Other Operations primarily includes natural gas volumes in Horn River.

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Supplemental Oil and Gas Operating Statistics (unaudited)

 

Results by Play (continued)

							2024				2023
(US$ millions)							Q1				Year			Q4			Q3			Q2			Q1
Capital Expenditures, Excluding Capitalized Internal Costs
USA Operations
	Permian							278				1,360			335			524			295			206
	Anadarko							6				180			24			3			55			98
	Uinta							136				396			123			136			76			61
	Other (1)							-				112			-			3			43			66
Total USA Operations								420				2,048			482			666			469			431
Canadian Operations
	Montney							126				544			127			130			152			135
	Other (1)							-				(2	)		-			-			-			(2	)
Total Canadian Operations								126				542			127			130			152			133
Total Capital Expenditures, Excluding Capitalized Internal Costs								546				2,590			609			796			621			564
Capitalized Directly Attributable Internal Costs
USA Operations
	Permian							26				83			29			16			19			19
	Anadarko							3				21			5			5			4			7
	Uinta							8				31			9			8			7			7
	Other (1)							-				6			-			-			3			3
Total USA Operations								37				141			43			29			33			36
Canadian Operations
	Montney							7				6			6			6			(15	)		9
	Other (1)							-				1			1			-			-			-
Total Canadian Operations								7				7			7			6			(15	)		9
Total Capitalized Directly Attributable Internal Costs								44				148			50			35			18			45
Total Capital Expenditures
USA Operations
	Permian							304				1,443			364			540			314			225
	Anadarko							9				201			29			8			59			105
	Uinta							144				427			132			144			83			68
	Other (1)							-				118			-			3			46			69
Total USA Operations								457				2,189			525			695			502			467
Canadian Operations
	Montney							133				550			133			136			137			144
	Other (1)							-				(1	)		1			-			-			(2	)
Total Canadian Operations								133				549			134			136			137			142
Corporate & Other								1				6			1			3			1			1
Total Capital Expenditures								591				2,744			660			834			640			610
Net Acquisitions & (Divestitures)								188				(495	)		(27	)		47			(702	)		187
Net Capital Investment								779				2,249			633			881			(62	)		797

 

(1) Other Operations includes capital expenditures in plays that are not part of the Company’s current focus. Capital expenditures associated with Bakken were included in USA Other Operations until the asset was divested on June 12, 2023.

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Supplemental Oil and Gas Operating Statistics (unaudited)

 

Results by Play (continued)

							2024				2023
							Q1				Year			Q4			Q3			Q2			Q1
Drilling Activity (net wells drilled)
USA Operations
	Permian							32				113			25			45			26			17
	Anadarko							-				11			-			2			2			7
	Uinta							15				33			12			10			8			3
	Other (1)							-				11			-			-			6			5
Total USA Operations								47				168			37			57			42			32
Canadian Operations
	Montney							21				96			28			19			23			26
Total Canadian Operations								21				96			28			19			23			26
Total								68				264			65			76			65			58
Completions Activity (net wells on production)
USA Operations
	Permian							21				184			60			83			27			14
	Anadarko							-				25			4			1			7			13
	Uinta							9				21			8			10			3			-
	Other (1)							-				16			-			-			8			8
Total USA Operations								30				246			72			94			45			35
Canadian Operations
	Montney							11				77			15			22			29			11
Total Canadian Operations								11				77			15			22			29			11
Total								41				323			87			116			74			46

 

(1) Other Operations includes net wells drilled and net wells on production in plays that are not part of the Company’s current focus. Net wells drilled and net wells on production associated with Bakken were included in USA Other Operations until the asset was divested on June 12, 2023.

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For the period ended March 31, 2024

(US$ millions, except per share amounts or as indicated)

 

Non-GAAP Cash Flow, Non-GAAP Cash Flow Per Share (CFPS) and Non-GAAP Free Cash Flow - Non-GAAP Cash Flow is defined as cash from (used in) operating activities excluding net change in other assets and liabilities, and net change in non-cash working capital. Non-GAAP CFPS is Non-GAAP Cash Flow divided by the weighted average number of shares of common stock outstanding. Non-GAAP Free Cash Flow is defined as Non-GAAP Cash Flow in excess of capital expenditures, excluding net acquisitions and divestitures. Management believes these measures are useful to the Company and its investors as a measure of operating and financial performance across periods and against other companies in the industry, and are an indication of the Company’s ability to generate cash to finance capital programs, to service debt and to meet other financial obligations. These measures are used, along with other measures, in the calculation of certain performance targets for the Company’s management and employees.

 

Non-GAAP Cash Flow													YTD 2024
Cash from (used in) Operating Activities												$		659
Deduct (add back):
		Net change in other assets and liabilities												(12	)
		Net change in non-cash working capital												(364	)
Non-GAAP Cash Flow												$		1,035
Per Share - Basic												$		3.84
Per Share - Diluted														3.80
Non-GAAP Free Cash Flow
Non-GAAP Cash Flow												$		1,035
Deduct:
		Capital expenditures												591
Non-GAAP Free Cash Flow												$		444

 

Non-GAAP Adjusted Earnings - is defined as Net Earnings (Loss) excluding non-cash items that management believes reduces the comparability of the Company’s financial performance between periods. These items may include, but are not limited to, unrealized gains/losses on risk management, impairments, non-operating foreign exchange gains/losses, and gains/losses on divestitures. Income taxes includes adjustments to normalize the effect of income taxes calculated using the estimated annual effective income tax rate. In addition, any valuation allowances are excluded in the calculation of income taxes.

 

Non-GAAP Adjusted Earnings													YTD 2024
Net Earnings (Loss) Before Income Tax												$		428
Before-tax (Addition) Deduction:
		Unrealized gain (loss) on risk management												(100	)
		Non-operating foreign exchange gain (loss)												25
Adjusted Earnings (Loss) Before Income Tax														503
		Income tax expense (recovery)												114
Non-GAAP Adjusted Earnings												$		389
Per Share - Basic												$		1.44
Per Share - Diluted														1.43

 

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Debt to Capitalization - Capitalization includes debt and total shareholders’ equity. Debt to Capitalization is monitored by management as an indicator of the Company’s overall financial strength.

 

Debt to Capitalization													YTD 2024
Long-Term Debt, Including Current Portion												$		6,198
Total Shareholders’ Equity														10,262
Capitalization												$		16,460
Debt to Capitalization													38%

 

Debt to Adjusted Capitalization - Debt to Adjusted Capitalization is a non-GAAP measure and is a proxy for Ovintiv’s financial covenant under the Company’s credit facilities which require Debt to Adjusted Capitalization to be less than 60 percent. Adjusted Capitalization includes debt, total shareholders’ equity and an equity adjustment for cumulative historical ceiling test impairments recorded as at December 31, 2011 in conjunction with the Company’s January 1, 2012 adoption of U.S. GAAP.

 

Debt to Adjusted Capitalization													YTD 2024
Long-Term Debt, Including Current Portion												$		6,198
Total Shareholders’ Equity														10,262
Equity Adjustment for Impairments at December 31, 2011														7,746
Adjusted Capitalization												$		24,206
Debt to Adjusted Capitalization													26%

 

EBITDA, Debt to EBITDA, Adjusted EBITDA and Debt to Adjusted EBITDA (Leverage Ratio) - EBITDA is defined as trailing 12-month net earnings (loss) before income taxes, DD&A, and interest. Adjusted EBITDA is defined as EBITDA adjusted for impairments, accretion of asset retirement obligation, unrealized gains/losses on risk management, foreign exchange gains/losses, gains/losses on divestitures and other gains/losses. Debt to EBITDA and Debt to Adjusted EBITDA are non-GAAP measures monitored by management as an indicator of the Company’s overall financial strength.

 

					Q2 2023				Q3 2023				Q4 2023				Q1 2024				Trailing 12- Months
Long-Term Debt, Including Current Portion																				$		6,198
Net Earnings (Loss)				$		336		$		406		$		856		$		338		$		1,936
Add back (deduct):
		Depreciation, depletion and amortization				419				486				556				566				2,027
		Interest				80				98				106				98				382
		Income tax expense (recovery)				101				(13	)			211				90				389
EBITDA				$		936		$		977		$		1,729		$		1,092		$		4,734
Debt to EBITDA (times)																						1.3

 

					Q2 2023				Q3 2023				Q4 2023				Q1 2024				Trailing 12- Months
Long-Term Debt, Including Current Portion																				$		6,198
Net Earnings (Loss)				$		336		$		406		$		856		$		338		$		1,936
Add back (deduct):
		Depreciation, depletion and amortization				419				486				556				566				2,027
		Accretion of asset retirement obligation				4				5				5				5				19
		Interest				80				98				106				98				382
		Unrealized (gains) losses on risk management				(142	)			292				(326	)			100				(76	)
		Foreign exchange (gain) loss, net				25				(22	)			19				(28	)			(6	)
		Other (gains) losses, net				(11	)			(2	)			(4	)			(4	)			(21	)
		Income tax expense (recovery)				101				(13	)			211				90				389
Adjusted EBITDA				$		812		$		1,250		$		1,423		$		1,165		$		4,650
Debt to Adjusted EBITDA (times)																						1.3

 

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Operating Margin/Operating Netback - Product revenues less costs associated with delivering the product to market, including production, mineral and other taxes, transportation and processing and operating expenses. When presented on a per BOE basis, Operating Netback is defined as indicated divided by average barrels of oil equivalent sales volumes. Operating Margin/Operating Netback is used by management as an internal measure of the profitability of a play.

 

Upstream Operating Cash Flow, excluding Risk Management and Upstream Operating Free Cash Flow - Upstream Operating Cash Flow, excluding Risk Management is a measure that adjusts the USA and Canadian Operations revenues for production, mineral and other taxes, transportation and processing expense, operating expense and the impacts of realized risk management activities. It is calculated as total upstream operating income excluding upstream depreciation, depletion and amortization, and the impact of risk management activities. Upstream Operating Free Cash Flow is defined as Upstream Operating Cash Flow, excluding Risk Management, in excess of upstream capital investment, excluding net acquisitions and divestitures. Management monitors these measures as it reflects operating performance and measures the amount of cash generated from the Company’s upstream operations.

 

Free Cash Flow Yield - Annualized Non-GAAP Free Cash Flow divided by the Company’s market capitalization.

 

Cash Return Yield - The sum of Ovintiv’s base dividend and expected cash returned to shareholders under the Company’s capital allocation framework, divided by the Company’s market capitalization.

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Netback Calculation

 

Netback is a common metric used in the oil and gas industry to measure operating performance on a per-unit basis and is considered a non-GAAP measure. The netbacks disclosed below have been calculated on a BOE basis using upstream product revenues, excluding the impact of realized gains and losses on risk management, less costs associated with delivering the product to market, including production, mineral and other taxes, transportation and processing expense and operating expense.

 

Selected Financial Data (1)
							2024			2023
(US$ millions)							Q1			Year			Q4			Q3			Q2			Q1
USA Operations
	Upstream Product Revenue (2,3)							1,461			5,565			1,656			1,544			1,179			1,186
	Production, mineral and other taxes							80			327			90			84			73			80
	Transportation and processing							127			547			128			124			148			147
	Operating (4)							211			743			198			208			167			170
								1,043			3,948			1,240			1,128			791			789
Canadian Operations
	Upstream Product Revenue (2,3)							468			2,212			552			504			467			689
	Production, mineral and other taxes							3			15			3			5			3			4
	Transportation and processing							251			1,056			256			265			268			267
	Operating (4)							25			88			29			28			2			29
								189			1,053			264			206			194			389
Total Operations
	Upstream Product Revenue (2,3)							1,929			7,777			2,208			2,048			1,646			1,875
	Production, mineral and other taxes							83			342			93			89			76			84
	Transportation and processing							378			1,603			384			389			416			414
	Operating (4)							236			831			227			236			169			199
								1,232			5,001			1,504			1,334			985			1,178
(1)		Segmented financial information per the notes to Ovintiv's financial statements.
(2)		Excludes the impact of realized gains and losses on risk management.
(3)		Excludes service revenues, certain other revenues and royalty adjustments with no associated production volumes.
(4)		Excludes other operating expenses with no associated production volumes.
Sales Volumes (1)
							2024			2023
(BOE)							Q1			Year			Q4			Q3			Q2			Q1
USA Operations								31,165,771			120,609,505			33,771,820			31,141,172			29,044,015			26,652,510
Canadian Operations								20,999,433			85,848,365			21,907,316			21,465,900			23,096,801			19,378,260
Total								52,165,204			206,457,870			55,679,136			52,607,072			52,140,816			46,030,770
(1)		Numbers may not add due to the calculation of volumes, which is based on sales volumes per day on a BOE basis times the number of days in the period.
Calculated Operating Netback, excluding the Impact of Realized Gains (Losses) on Risk Management (1)
							2024			2023
(US$/BOE)							Q1			Year			Q4			Q3			Q2			Q1
Total USA Operations
	Price							46.88			46.14			49.03			49.58			40.59			44.50
	Production, mineral and other taxes							2.57			2.71			2.66			2.70			2.51			3.00
	Transportation and processing							4.07			4.54			3.79			3.98			5.10			5.52
	Operating							6.77			6.16			5.86			6.68			5.75			6.38
	Netback							33.47			32.73			36.72			36.22			27.23			29.60
Total Canadian Operations
	Price							22.29			25.77			25.20			23.48			20.22			35.56
	Production, mineral and other taxes							0.14			0.17			0.14			0.23			0.13			0.21
	Transportation and processing							11.95			12.30			11.69			12.35			11.60			13.78
	Operating							1.19			1.03			1.32			1.30			0.09			1.50
	Netback							9.00			12.27			12.05			9.60			8.40			20.07
Total Operations
	Price							36.98			37.67			39.66			38.93			31.57			40.73
	Production, mineral and other taxes							1.59			1.66			1.67			1.69			1.46			1.82
	Transportation and processing							7.25			7.76			6.90			7.39			7.98			8.99
	Operating							4.52			4.03			4.08			4.49			3.24			4.32
Netback								23.62			24.22			27.01			25.36			18.89			25.59
(1)		May not add due to rounding. Ovintiv calculates reported netbacks using whole dollars and sales volumes. Accordingly, the calculations above may differ from the reported netbacks due to the effects of rounding both dollars and volumes.

 

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v3.24.1.u1

Document And Entity Information	May 07, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 07, 2024
Entity Registrant Name	Ovintiv Inc.
Entity Central Index Key	0001792580
Entity Emerging Growth Company	false
Entity File Number	001-39191
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	84-4427672
Entity Address, Address Line One	Suite 1700, 370 17th Street
Entity Address, City or Town	Denver
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80202
City Area Code	303
Local Phone Number	623-2300
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	OVV
Security Exchange Name	NYSE

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