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Baytex Announces 2023 Budget with Continued Focus on Free Cash Flow Generation and Enhancing Direct Shareholder Returns
Calgary, Alberta--(Newsfile Corp. - December 7, 2022) - Baytex Energy Corp. (TSX: BTE) ("Baytex")...
About this update from Baytex Energy Corp.
[{"type":"text","content":"Baytex Announces 2023 Budget with Continued Focus on Free Cash Flow Generation and Enhancing Direct Shareholder ReturnsCalgary, Alberta--(Newsfile Corp. - December 7, 2022) - Baytex Energy Corp. (TSX: BTE) (\"Baytex\") announces that its Board of Directors has approved 2023 exploration and development expenditures of $575 to $650 million, which are designed to generate average annual production of 86,000 to 89,000 boe/d.\"We expect to generate record free cash flow in 2022 and our priorities for 2023 remain the same. We will advance development across our high-quality oil weighted portfolio, further delineate our Peavine Clearwater acreage and progress our Duvernay light oil resource play. We are committed to allocating capital efficiently to generate meaningful free cash flow and, as we achieve our debt targets, increasing direct shareholder returns. In a US$80/bbl WTI pricing environment, we expect to generate approximately $3.1 billion of cumulative free cash flow through our 2022-2026 five-year outlook,\" commented Eric Greager, President and Chief Executive Officer.Highlights of the 2023 BudgetFunding of Capital Program. Based on the forward strip(1) our exploration and development expenditures represent approximately 55% of adjusted funds flow. Free Cash Flow. Based on the forward strip(1) we expect to generate approximately $450 million of free cash flow(2) in 2023. For every US$5/bbl change in WTI, our adjusted funds flow(3) changes by approximately $139 million on an unhedged basis ($128 million including 2023 WTI hedges). Production Growth. Our 2023 production guidance (at the mid-point) represents a 4% increase from forecast 2022 production guidance (8% increase on a per-share basis(4)). Capital Efficiency. Our capital program is expected to generate capital efficiencies of approximately $19,500 per boe/d across the portfolio. Capital Allocation. We plan to direct approximately 65% of our exploration and development expenditures to our light oil assets and approximately 35% to our heavy oil assets, which includes approximately 15% of our 2023 capital program being directed to our Peavine Clearwater assets.Shareholder Returns. We are currently allocating 25% of free cash flow to share buybacks and 75% of free cash flow to debt reduction. We expect to reach a net debt(3) level of $800 million by mid-2023 at which p...