Baytex Energy Corp.

Thank you for standing by. This is the conference operator. Welcome to the BATEX Energy Third Quarter 2021 Financial and Operating Results Conference Call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Brian Hector, Vice President, Capital Markets. Please go ahead, sir.

Thank you, Claudia. Good morning, ladies and gentlemen, and thank you for joining us today to discuss our third quarter 2021 financial and operating results. Today I am joined by Ed LaFerre, our President and Chief Executive Officer, Rod Gray, our Executive VP and Chief Financial Officer, Chad Lundberg, our Chief Operating and Sustainability Officer, Kendall Arthur, Vice President Heavy Oil, Chad Kalnikoff, VP Finance, and Scott Lovett, our VP of Corporate Development. While listening, please keep in mind that some of our remarks will contain forward-looking statements within the meaning of applicable securities laws. I refer you to the advisories regarding forward-looking statements, oil and gas information, and non-GAAP financial and capital management measures in yesterday's press release. All dollar amounts referenced in our remarks are in Canadian dollars unless otherwise specified. And with that, I would now like to turn the call over to Ed.

Thanks, Brian, and good morning, everyone. I'd like to welcome everybody to our third quarter 2021 conference call. I'm excited to highlight the momentum we continue to build. During the third quarter, we delivered strong operating and financial results, and we advanced our exciting new Clearwater play in northwest Alberta with the two strongest initial rate wells in the play. I'll expand on our Clearwater development in a few minutes. As you will recall, earlier this year, we made a commitment to maintain capital discipline and maximize our free cash flow. We also made a commitment to allocate 100% of our free cash flow to reducing our net debt and strengthening our business. And I'm very pleased to say that is exactly what we are doing. During the third quarter, we generated $101 million of free cash flow, resulting in year-to-date free cash flow of $284 million. This free cash flow has been applied against our net debt, and our business today is that much stronger as a result. At current commodity prices, we now expect to deliver over $400 million, or 71 cents per basic share, of free cash flow in 2021. This represents a record level of free cash flow for BATEX and is accelerating our debt reduction efforts. We now have line of sight to reaching our initial $1.2 billion net debt target during the second quarter of 2022. We have also taken proactive steps to reduce our outstanding long-term notes which lowers our financing costs and increases our adjusted funds flow. Rod will touch on this in a few minutes. During the quarter, we delivered adjusted funds flow of $198 million, or 35 cents per basic share, and generated net income of $33 million, or 6 cents per basic share. We realized an operating net back of $39 per BOE, which is up from $34 per BOE realized in the second quarter. Production during the quarter averaged 79,900 BOEs per day, 82% oil and NGLs, and reflects strong performance across our light and heavy oil assets in Canada, with volumes up 2% over the second quarter, while our Eagleford volumes were lower due to the number of wells brought on stream. Exploration and development expenditures totaled $94 million and included the drilling of 47 net wells. Last quarter, we highlighted our peavine lands in Northwest Alberta, where we are targeting the Spirit River Formation, a clear water formation equivalent. In August 2021, we executed a second strategic agreement with the Peavine Métis Settlement that covers an additional 20 sections, bringing our total peavine acreage to 80 contiguous sections. We currently have five producing wells on our peavine acreage, and production has increased from zero at the beginning of this year to approximately 1,900 barrels per day currently. Our three eight lateral wells continue to outperform tight curve assumptions and two of these wells rank as the top initial rate wells drilled to date across the play. At current commodity prices, the Clearwater generates among the strongest economics within our portfolio with payouts of less than six months and has the ability to grow organically while enhancing our free cash flow profile. As we continue to progress our development plan, we have committed to drill four additional clear water wells during the fourth quarter. We expect these wells to come on stream late 2021. In addition, as part of our 2022 plan, we are working with the Peavine Métis settlement and are prepared to execute an expanded program of up to 18 wells. To date, we have de-risked 20 sections of land And pending further success, we believe the play holds the potential for greater than 200 locations. In addition to our clearwater development, our heavy oil program kicked off during the third quarter and included drilling two net blue sky wells at Peace River and 14 net wells at Lloyd Minster. On the light oil side, we brought 37 net Viking wells and 3.4 net Eagleford wells on stream. In addition, we drilled two 100% working interest wells in the DuVernay, and initial flowback rates are very encouraging. Our operational execution was excellent across our entire portfolio and sets us up for strong fourth quarter results. I will now turn the call over to Rod to discuss our balance sheet and risk management.