i3 Energy unveils ambitious 2024 capital programme
() , a UK and Canada focused oil producer, announced its 2024 capital budget and production guidance ahead of an investor webinar on May 2nd.
i3 Energy announced a 2024 capital budget of US$50.9m, forecast to deliver 15 gross wells (10.5 net to , 95% net -operated) to be drilled across the company's Canadian licences in Central Alberta, Simonette, and northern Clearwater. Drilling is scheduled to recommence in June 2024, with plans for accelerated development of the Simonette Montney acreage in 2025.
forecasts the 2024 programme to result in production at year-end of 20,250-21,250 boped, representing an year-on-year increase of c. 3%, or c. 8% from current levels. When adjusted for 's royalty disposition, 2024 exit production growth reflects 5% on a year-over-year basis.
In terms of cash flow, forecasts US$70-75m of 2024 net operating income and US$55-60m of EBITDA before hedging gains and losses. These figures are based on budget price assumptions of US$82/barrel for WTI and CAD$2.25/gigajoules for AECO natural gas.
View from Vox
i3 Energy announces an ambitious US$50.9m capital programme that will see large-scale development of oil and gas wells across its acreages in Canada. The new budget builds on a strong FY23 that saw record annual average production of 20,711 boepd thanks to a highly productive 2023 work programme, and continued momentum into H1 2024 with notable improvements in balance sheet and liquidity.
The new work programme will be fully funded from existing resources. remains well funded after recently completing a US$24.8m partial sale of its royalty assets, eliminating all bank debt while establishing a US$55.6m reserve-based credit facility. The 2024 programme will also support a long-term dividend, with an est. £12.3m to be returned in FY24, representing 1.0260/p for the year and a forward yield of 8.1% based on a share price of 12.66p for .
Investors should note that the new capital programme will be c. 85% H2-weighted to take advantage of stronger forecast winter gas pricing. In the event forward gas prices deteriorate, has flexibility to reallocate drilling locations to more oil-weighted opportunities. Additionally, pad drilling of the prospective Montney acreage is expected to begin in Q1 2025.
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