CA - Baytex Energy: Clearwater Production Up As Advertised
2024-07-01 07:22:54 ET
Summary
- Acquisition of oil light production allowed Baytex Energy to safely increase Clearwater heavy oil production without risking the company.
- Management may have an opportunity to achieve a faster Clearwater payback.
- Management is likely to make the acquired Eagle Ford operation more efficient. This production needs to show a decent profit as well.
- Heavy oil production is discounted, and profitability may only last through part of the cycle, it has been speculated that Clearwater production may survive downturns.
- The acquisition is likely to show benefits in the form of greater Clearwater production sooner than it will by optimizing the Eagle Ford production.
My previous article (and many before it) stated that the main benefit of acquiring oil light production would be the ability for Baytex Energy ( BTE ) to safely increase the Clearwater heavy oil production without "betting the company". As the first quarter report showed, that indeed happened. It is likely to happen a whole lot more. Management will also likely make the acquired Eagle Ford operation more efficient. But the big news is the Clearwater production.
Baytex Energy Summary Of Production By Basin (Baytex Energy First Quarter 2024, Earnings Press Release And Reports Filed With Sedar)
