Tourmaline Provides EP Activity Update and Announces Two Additional LNG Agreements
Press Release
JANUARY 15, 2024
Calgary, Alberta – Tourmaline Oil Corp. (TSX:TOU) (“Tourmaline” or the “Company”) is pleased to provide an EP activity update and to announce two additional LNG agreements.
EP ACTIVITY UPDATE
Tourmaline exited 2023 with average daily production in excess of 600,000 boepd including over 150,000 bbls/d of average liquids production and has continued at these production levels in January. The Company is operating all 16 drilling rigs as planned in the Q1 2024 EP program and the planned 2024 capital program has minimal associated facility expenditures. Similar to 2023, Tourmaline plans to maximize free cash flow ( 1 ) in 2024. The Company will closely monitor exploration and production expenditures (2) and the natural gas pricing environment throughout the year and adjust the EP program accordingly. Tourmaline has 724 mmcfpd of natural gas hedged at an average price of C$5.28/mcf in 2024. The Company has an average 959 mmcfpd of unhedged volumes exposed to the export markets in 2024, of which 61% is exposed to premium priced markets such as US Gulf Coast, Western US, JKM, TTF and Sumas. The Company continues to believe in the strong North American natural gas outlook for the 2025- 2030 time frame and will match planned growth with improving pricing.
ADDITIONAL LNG AGREEMENTS
Tourmaline is pleased to announce that it has increased its exposure to JKM by entering into a netback agreement with Trafigura Pte Limited based on 62,500 mmbtu/d of Liquified Natural Gas (~0.5 mtpa) for a seven-year term starting January 2027, with the potential for extension to December 2039. Tourmaline has also expanded its international exposure to include a physical netback agreement with
Trafigura Canada Limited which will receive Dutch TTF index pricing. Starting in March 2024, Tourmaline will deliver 50,000 mmbtu/d of natural gas at AB-NIT and receive a Dutch TTF index price (less associated deductions) until December 2026.
FINANCIAL UPDATE
Tourmaline plans to pay four quarterly special dividends in 2024 in addition to the quarterly base dividend of $0.28/share, while also maintaining the net debt( 3) to cash flow(4) target of between 0.25 and 0.35 times by year-end 2024. The Company has determined to commence a process to sell the Duvernay assets which were acquired pursuant to the acquisition of Bonavista Energy Corporation completed by the Company in November 2023.
Reader Advisories
CURRENCY
All amounts in this news release are stated in Canadian dollars unless otherwise specified.
IBF4
