Whitecap Resources Inc.

Good morning, my name is Sylvie and I will be your conference operator today. At this time, I would like to welcome everyone to Whitecap Resources Q4 and Full Year 2024 Results Conference Call. Note that all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question at that time, simply press star then number one on your telephone keypad. And if you would like to withdraw your question, please press star then number two. And I would like to turn the conference over to Whitecap's President and CEO, Mr. Grant Fagerheim. Please go ahead, sir.

Thank you, Sylvie. Good morning, everyone, and thank you for joining us today. There are five members of our management team here with me today. Our Senior Vice President and CFO, Ton Kang. Our Senior Vice President, Business Development, Information Technology, Dave Bomberkett. Our Senior Vice President, Production and Operations, Joel Armstrong. Our Vice President of our West Division, Joy Wong, and our Vice President of the East Division, Chris Bullen. Before we get started today, I would like to remind everybody that all statements made by the company during this call are subject to the same forward-looking disclaimer and advisory that we set forth in our news release issued yesterday afternoon. 2024 was an exceptional year in all areas of our business. The execution of our $1.1 billion capital program delivered production results that consistently exceeded our expectations. providing four guidance increases throughout the year. These results not only validate the strength of our asset base, but also the resolve of our personnel along with our ability to execute and deliver on our growth targets. We are also very pleased to have returned over $560 million of capital back to our shareholders during 2024, over $430 million through our base dividend of 73 cents per share annually, and approximately $130 million in share repurchases. This was made possible with our balance sheet flexibility that we maintained and was actually enhanced throughout the year. Our strong year provided for an impressive 2024 reserve growth report for McDaniels with debt-adjusted reserves per share growth between 12% to 13% and low FD&A costs resulting in attractive recycle ratios of 3.8 times, 2.7 times, and 3.3 times for approved developed producing total proof and proof plus probable reserves respectively. We believe that we have a very attractive inventory of opportunities on our asset base that will provide long-term profitable and sustainable growth for our shareholders. During 2024, we ran a highly competitive process to unlock a portion of the value with the infrastructure portfolio, culminating with the partial sell-down of our Masero 5 and 9 battery to Topaz and our 15 and 7 KBOB gas processing facility and the rate to fund our future 413 Latour facility to PGI for total proceeds of $520 million. We retained operatorship of all three facilities and will utilize both in-house and PGI's expertise in constructing our new Latour facility, scheduled to be completed by late 2026, early 2027. In addition, we also formed a strategic partnership with PGI and Pemina to unlock further value from these assets. in alignment with our long-term strategic goals for both us and our partners. Receiving preferential fees and access to their vast network of infrastructure and midstream assets was made possible by signing long-term agreements that are supported with high quality and long-dated inventory of our unconventional Montney and DuVernay assets that we possess. Both Joey and Chris will provide more insight on the asset-specific details, but I would like to highlight a few meaningful areas that drove a significant portion of our outperformance in 2024. With our unconventional assets, one of the main 2024 highlights would be our Montney asset at Musrell. We completed our 5.9 battery in March, two weeks ahead of schedule and 10% under budget, and we were able to quickly add production for our first four-well pads in the area. Since that time, we've grown production to 17,500 VUE per day, where we reached condensate production capacity as the wells consistently provided higher condensate to gas ratios than we had forecast. Overall, condensate from the assets provided over 2,000 BWE per day relative to our initial budget and remain driver of this year's success. At KBOB, results outperformed our initial expectations by 1,500 BWE per day as both initial production rates were higher than forecasted and base production showed stronger performance than what we were expecting. anticipate our 15 to 7 gas processing facility to operate at capacity in the second half of 2025, which is earlier than previously forecasted. On the conventional side, the two areas that were primary drivers of outperformance was the Frobisher asset in East Saskatchewan and the Glauconite asset in Central Alberta. New outperformance was strong in Frobisher, resulting in 2,000 BUE per day of outperformance and our 2024 program paying out in only nine months. Advances in drilling techniques to add second and third lateral legs have improved the already robust economics of this play since we acquired it in 2021. In the glauconite, we were able to secure additional egress options through 2024, which enabled our base and new production to outperform our initial expectations by approximately 1,200 BUE per day. Combined with the cost savings that we are now realizing through the use of monoboard drilling technique, the asset is really showing its strength within our portfolio. As mentioned at the onset, we have an exceptional 2024, and while we were some of the more notable areas of outperformance, our teams continue to pursue small wins across our entire portfolio that in aggregate drive continuous improvement and strong results for our shareholders. I will now pass it off to Joey for more results on our West Division.

Thanks, Rich. Our unconventional assets closed the year with strength. as both new drills and base production exceeded expectations across all focus areas in the Montigny and Duvernay. On average, our Duvernay wells outperformed internal expectations by over 15%, while our Montigny wells outperformed by over 20%. This outperformance is aided by the continued application of our unconventional development workflow to an already strong asset base. This workflow combines a number of technical best practices with the goal of delivering optimized and predictable results. It further informs our development decisions, such as well and completion designs, real-time monitoring and optimization of completion operations, and production and drawdown strategies. The consistency and scale of outperformance provides strong operational momentum as we commence our 2025 program and has reinforced confidence in our long-range plan for our unconventional assets. That long-range plan sets out a projected growth of 10% to 15% per year with a 2025 forecast of 65,000 to 70,000 BUEs per day and growth to 100,000 to 120,000 BUEs per day by the end of 2029. With only 16% of our almost 2500 inventory locations booked and proven plus probable reserves, we are confident that we will hit these targets and continue to do so well into the future. Building on the asset level discussion that Grant just spoke to, a key highlight in 2024 was the completion and start-up of our We have now brought on 16 wells at Musro and have exceeded expectations on both the strength of inflow and condensate to gas ratios. Further, we are observing impressive bottom hole characteristics with wells in our multi-bench configuration tracking long-term outperformance to expectations of approximately 20%. These observations have reaffirmed our design selection of a multi-bench development in this area. This approach, which vertically offsets wells within the Montney, enhances reservoir coverage while mitigating inter-wellbore interference. If these results can be replicated across our undeveloped acreage, we anticipate increased EUR per well and or expanded inventory through modestly higher well density, materially enhancing capital efficiencies, extending asset duration, and increasing profitability. At Latour, significant progress continues on our 413 Phase 1 facility scheduled for completion in late 2026, early 2027. Engineering and procurement efforts are advancing as planned, with permitting in progress and approximately three-quarters of critical long-lead items now ordered. In 2024, we drilled two single wells on the eastern and southern portions of our Latour acreage, respectively, to assess the deliverability and liquids content across this sizable land block that covers roughly four townships of highly prospective Montney rights. The first well, 13 of 21, has now been on production for more than 120 days and has achieved an IP 120 of 1,265 BOEs per day, of which 41% were liquids, including 442 barrels a day of condensate. The second well, at 13 of 35, with 85 days of production, is tracking a projected IP of just over 1,600 BOEs per day, of which 24% are liquids, including just over 250 barrels a day of condensate. On an asset of this size, we do expect variability in liquids content, and keep in mind that our total liquid splits for both wells would be 10 to 15% higher if they were flowing through to our future 413 facility and onto a deep cut plant, which is one of the many advantages that our strategic partnership with PGI and Pembina provides us. Also of note, Condensate to gas ratios on both wells were higher than our initial expectations for each specific area, which is positive for the overall economics of this asset. Moving over to KBOB, we recently completed fracturing operations on our second wine racked duvernay pad at 805A, which is a follow-up to our pilot at 11-14B. Initial indications upon completion, flowback, and early production days were all favorable on the 11-14B pad, which gave us the confidence to progress this initiative to ensure repeatability of the observed improvements. We're now up to over 120 days of production for that 11-14B pad, and with an IP120 still over 1,200 BOEs per day, combined with our observations of the bottom hole flowing conditions, we are pleased with the initial results that continue to provide key validation points that support our assessment of what this asset might be capable of. The measured approach to development and optimization of this asset demonstrates our commitment to enhancing capital efficiency and improving and or expanding our inventory. As results are further collected from these early paths, we will assess the potential for further enhancement through potential inter-well spacing reductions and associated inventory adds, proceeding only if additional well density proves economically accretive. Beyond wine rack trials, we are also advancing capital efficiency improvements through extended laterals, leveraging our land base and subsurface characteristics. Our next three development paths will feature 2 1⁄2-mile laterals, enhancing resource recovery and operational efficiency. With that, I will now pass it over to Chris Bullen, Vice President of our East Division, to talk about our conventional assets.