02.24
Baytex Energy Trust (BTE.UN): $32.47 – F&D Higher Than Expected, but Drilling Results
Outperform, Average Risk, Price Target: $33.00 (prev. $30.00)
Baytex reported 2P reserves of 197 mmboe, a 5% increase over 2008, and 1P reserves of 129 mmboe. Heavy oil reserves continued to show strong growth (+15.5% from 2008), while light declined by 4%, NGLs by 22.5% and natural gas by 25%. Finding costs for the year were higher than expected, with 2P F&D (including FDC) of $20.10/boe versus 2008 at $12.09/boe and the three-year average of $11.08/boe. The results reflected: (i) negative revisions to natural gas and NGL reserves; and (ii) a substantial increase to estimated future development capital, which was partially due to revisions to cost estimates for previously booked reserves.
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