Canada’s Whitecap rebounds to profit in Q1

Canadian producer Whitecap Resources said April 29 it had net income of C$19.6mn (US$15.9mn) in Q1 2021, rebounding from a C$2.1bn net loss in Q1 2020, when collapsing oil and gas prices forced a non-cash accounting charge of C$2.9bn.

Funds flow increased to C$187.8mn from C$131.8mn, which Whitecap attributed to higher commodity prices and increased oil and gas production.

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Total production averaged 95,828 barrels of oil equivalent (boe)/day in Q1 2021, up from 73,452 boe/day in the comparable period a year ago.

Natural gas production was sharply higher, at 129.1mn ft³/day compared to 70.5mn ft³/day, reflecting the 2020 acquisition of NAL Resources, which brought new associated gas production.

Crude oil and natural gas liquids production in Q1 2021 averaged 74,303 b/day, up from 61,708 b/day, reflecting both the NAL acquisition and the acquisition in 2020 of TORC Oil and Gas. The NAL acquisition closed in January this year; TORC closed in February.

Although Whitecap’s production is moving higher, it claims net-negative CO₂ emitter status, thanks largely to a pair of carbon capture, utilisation and storage (CCUS) projects in Alberta and Saskatchewan.

Its main CCUS project at Weyburn, Saskatchewan, has sequestered 36mn mt of CO₂ captured from the Boundary Dam coal-fired generating station and a coal gasification plant in North Dakota. 

A second sequestration project, at Joffre in central Alberta, was acquired as part of Whitecap’s acquisition of NAL Resources; in 2020, it sequestered 21,500 mt of CO₂ but process efficiency improvements have increased the annual rate to 34,000 mt/yr, with the potential for an additional increase to 45,000 mt/yr.

“Currently, we are sequestering approximately 2mn mt of CO₂/per year, which represents half of the 4mn mt/yr of CO₂ sequestered in Canada,” Whitecap says, noting that it has existing infrastructure capacity to increase sequestration volumes to more than 4mn mt/yr.

“We have identified a total of 250mn mt of pore space capacity for CCUS on our existing lands and anticipate with the initiatives we have underway having significantly higher capacity in the future,” it says. “In addition, we have more than 20 years of CCUS experience and have the facilities and infrastructure that provide a strong foundation…to quickly increase our sequestered volumes to assist other industry partners to find storage solutions for CO₂ emissions.”