ARC sets 2016 budget

Former TransCanada Corp. CEO Hal Kvisle will become chairman of ARC Resources Ltd. as of Jan. 1, taking the place of Mac Van Wielingen, the company announced Wednesday, noting the succession is a “long- planned move.”

Kvisle, who negotiated the sale of Talisman Energy Inc. to Spanish giant Repsol while acting as a temporary president and chief executive, has been on the ARC board since June 2009.

Van Wielingen, one of the founders of ARC in 1996, is to remain on the board of directors until after the next annual general meeting.

In 2016, we expect to deliver approximately five per cent annual production growth relative to 2015 levels.

MYRON STADNYK

The company became one of the first Calgary oil and gas producers to announce its 2016 capital budget on Wednesday. It said it plans to spend $ 550 million, the same as in 2015, although it added that about $ 125 million of planned investment in Alberta is “subject to reallocation should changes to the Alberta royalty framework materially impact well economics.”

In 2014, it spent $ 1.04 billion. Myron Stadnyk, ARC president and CEO said the company would continue to focus on its Montney lands next year and intends to grow production to 119,000 to 124,000 barrels of oil equivalent per day, with 41,000 to 45,000 barrels per day of liquids. “In 2016, we expect to deliver approximately five per cent annual production growth relative to 2015 levels, set the stage for continued development at Dawson in 2017 and beyond, and continue to pay a meaningful dividend to our shareholders,” he said in a news release.

ARC plans to drill 77 gross operated wells ( 71 net) in 2016, with 52 focused on crude oil, nine on liquidsrich natural gas of which three are exploratory wells, 14 wells focused on natural gas, and two service wells.

It plans to invest $ 90 million in strategic infrastructure at Dawson in northeastern B. C. in 2016.

ARC also reported a net loss of $ 235 million for the third quarter in 2015, compared to net income of $ 90 million in the third quarter of 2014.

It reported cash flow of $ 175 million, off from $ 284 million in the same period of last year, due to much lower realized prices.