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In the second quarter of the year Bonavista generated adjusted funds flow of C$65.7 million, allocating C$29.0 million to a reduction in total net debt.
Bonavista Energy Corporation (TSX:BNP) released its financial and operating results for Q2 and the six months that made up the first half of 2018.
In the second quarter of the year Bonavista generated adjusted funds flow of C$65.7 million, allocating C$29.0 million to a reduction in total net debt.
As quoted from the press release:
Enhancing excess adjusted funds flow while maintaining production has been our focus in 2018. In the first six months of this year, we have produced on average 70,304 boe per day while spending only 57 percent of adjusted funds flow on our exploration and development (E&D) program. This has resulted in C$51.5 million of surplus funds, net of dividends, available to allocate to total net debt reduction, realizing 65 percent of our annual target year-to-date. We remain on track to produce between 69,000 and 71,000 boe per day in 2018 and meaningfully reduce total debt throughout the year.
Operational and financial accomplishments for the second quarter of 2018 include:
- Generated adjusted funds flow of C$65.7 million, which was 18 percent ahead of budget largely due to stronger natural gas, oil and natural gas liquids (NGL) prices relative to forecast.
- Executed an E&D capital spending program of C$33.1 million, equal to 50 percent of adjusted funds flow, to drill six (5.8 net) wells and complete one well. With one well on production, the remaining five wells drilled will be brought on production late in the third quarter.
- Production averaged 68,214 boe per day for the quarter, which was modestly ahead of our budget. This includes an impact of approximately 3,500 boe per day of curtailed production resulting from facility turnarounds, ethane (C2) rejection at midstream facilities and significant NGTL maintenance. Current production is approximately 68,000 boe per day.
- Allocated C$29.0 million of excess adjusted funds flow to debt repayment, reducing long-term debt, net of adjusted working capital, by four percent to C$826.6 million relative to the same prior year period.
- Improved NGL benchmark and contracted pricing in Q2 resulted in a 17 percent improvement in realized pricing relative to the same prior year period.
- Reduced payments to service our long-term debt with interest expense decreasing by 16 percent relative to the same prior year period.
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