Cona is a Calgary, Alberta-based Canadian crude oil production and development company focused on maximizing oil recovery from its low decline, high free cash flow oil resource base. The Corporation’s operations, infrastructure and concentrated land position are focused in southwest Saskatchewan.
Cona’s strategic objective is to translate its superior free cash flow generation into an attractive risk adjusted total return to shareholders.
Three key elements to our business strategy
Development of low decline, high free cash flow production base through enhanced oil recovery (EOR):
Cona’s industry leading 10-12% decline asset base is predictable and holds numerous attractive low risk, high free cash flow development opportunities. These include continued effective downspacing of waterdrive reservoirs, optimization of existing waterflood patterns by realigning patterns, adding injection wells, injecting polymer, and employing recovery techniques that are well established in the industry which are supported by successful results in neighbouring fields. Over 70% of Cona’s production is currently under either waterflood or polymer flood, and the company has over 1,000 low risk infill drilling locations.
Maintaining a conservative balance sheet and capital structure supported by hedging:
Cona intends to maintain, through the application of disciplined capital investment and prudent use of leverage, a strong balance sheet, substantial liquidity and conservative capital structure. An active hedging program will be pursued to help provide enhanced cash flow predictability.
Assessing additional opportunities for growth:
Cona’s primary focus is on developing the significant investment opportunities on its existing asset base; however, the Corporation also actively assesses acquisition opportunities within the Western Canadian Sedimentary Basin with an aim to expand its development portfolio. Cona follows a disciplined methodology when evaluating new internal and external opportunities, including a rigorous assessment of the expected return versus the cost of capital, management’s ability to properly develop and manage the project, and per share accretion to near-term financial metrics as well as accretion to long-term net asset value.