12.02
Baytex announced 2010 guidance and a 50% increase to its monthly distributions. Baytex announced its 2010 E&D capex budget of $235 million versus $165 million in 2009 and our estimate of $205 million. Roughly 60% of the capital program will be directed to heavy oil. The remainder of the capital budget will focus on light oil and natural gas spending. Management views 2010 as a transition year for Baytex as it shifts from an income-focused model to a growth-and-income model for the post-trust era. Baytex has increased its monthly distribution to $0.18/unit from $0.12/unit (we had previously modeled an increase to $0.15/unit). The larger than expected distribution increase should allow Baytex to modestly grow its tax pools as 2011 approaches.
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