Ovintiv Inc. recorded a net loss in second-quarter 2021 of $205 million. The results included the impact of net losses on risk management of $799 million, before-tax.
Second quarter cash from operating activities was $750 million, non-GAAP cash flow was $733 million and capital investment totaled $383 million, resulting in $350 million of non-GAAP free cash flow.
Average total production was 555,000 boe/d and crude and condensate production averaged 201,000 b/d.
During the quarter, the operator accelerated the timeline to achieve its $4.5 billion net debt target to year-end 2021 from its original target date of year-end 2022. This target represents some $3 billion of net debt reduction since second-quarter 2020.
The company has set a new net debt target of $3 billion, which it expects to achieve by year-end 2023 and assuming $50/bbl WTI oil and $2.75/Mcf NYMEX natural gas prices. Ovintiv expects to meet this target without proceeds from asset sales.
At the end of the second quarter, the balance on the company’s revolving credit facility had been fully paid down and Ovintiv had no commercial paper outstanding. Ovintiv’s available liquidity totaled $4.4 billion.
Permian production averaged 126,000 boe/d (82% liquids) in the quarter. The company averaged three gross rigs, drilled 21 net wells, and had 33 net wells turned in line (TIL). Permian drilling and completion (D&C) costs averaged $480/ft year-to-date and are 11% lower than the 2020 program average. Among wells rig released in the quarter, the average lateral length drilled was 12,050 ft, some 20% longer than the 2020 average.
Anadarko production averaged 133,000 boe/d (62% liquids) in the quarter. The company averaged two gross rigs, drilled 16 net wells, and had 22 net wells TIL, of which 21 were operated by Ovintiv.
STACK D&C costs have averaged $430/ft year-to-date, and are 10% lower than the 2020 program average. During the quarter, 17 wells were completed in the STACK, with two wells drilled and completed for $3.5 million.
In SCOOP, four net Woodford-Caney oil wells were brought on-line in the quarter with an average D&C cost of $5.3 million.
Montney production averaged 235,000 boe/d (25% liquids) in the quarter. The company averaged four gross rigs, drilled 18 net wells, and had 30 net wells TIL.
Montney year-to-date D&C costs have averaged $410/ft and are 9% lower than the 2020 program average. All the quarterly wells TIL targeted the volatile oil and liquids-rich condensate fairway of the play with an expected liquids composition of 30-70%.
Bakken production averaged 24,000 boe/d (79% liquids) in the quarter. The company drilled one net well and had two net wells TIL. The two net wells brought online in the quarter hit an average 60-day initial production rate of 1,235 b/o per well. D&C costs from 2020 to 2021 have averaged $510/ft, 14% lower than the 2019 average.