Riding the low price environment – largest oil hedgers for Q2 2020

Latest hedging data from CanOils shows that among Canada’s largest oil producing companies, it is actually a number of gas-heavy companies that have protected their oil production against the falling oil price the best heading into Q2 2020.

This analysis was conducted using hedging contract data available in annual reports of 33 Canadian-listed companies.

  • Of the group, we looked at those that produced at an average of over 10,000 bbl/d of oil in 2019 and the proportion of these companies’ oil volumes that were hedged for the Q2 2020 period.
  • As we were mainly analyzing the impact of falling oil prices due to market share war between Russia and Saudi Arabia, and not widening differentials between WTI and Canadian crude due to Canadian market dynamics and capacity constraints, we deliberately limited our analysis to include only fixed swap, collar and three-way collar contracts for oil.
  • All other contract types are available in the CanOils hedging module but have been excluded here.

Comparing volumes that were hedged under fixed swaps, collars and three-way collars as of December 31, 2019 for the second quarter of 2020 by these companies, it was three gas-weighted producers in Ovintiv Inc., ARC Resources Ltd. and NuVista Energy Ltd. that enter Q2 2020 with the largest portion of their oil production portfolio hedged under a swap, collar or three-way collar contract.

Using CanOils data, it is also possible to study the other extreme of the spectrum. By analyzing CanOils debt levels and credit facility utilization data in combination with hedging strategies, it is possible to identify the companies that may be in a more challenging position through these uncertain times.

For more information and a CanOils demo, please contact Amit Patel, CanOils Account Executive at 403-209-3581 or apatel@glacierrig.com

Alternatively, you can find out more about the CanOils hedging data by completing the form at this link.

Example dataset pulled from CanOils – Athabasca Oil Corporation full hedge portfolio heading into 2020, based on data available in Annual Report as of Dec 31, 2019.

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