About Ovintiv

Ovintiv Inc. (Ovintiv) operates as a North American oil and natural gas exploration and production company. The company is focused on developing its multi-basin portfolio of high-quality assets located in the United States and Canada. Ovintiv's operations also include the marketing of oil, NGLs and natural gas. As of December 31, 2023, all of the company’s reserves and production were located in North America. Strategy The pillars that support the execution of the company’s strategy include: Execution Excellence - The company is a leader in the responsible multi-zone development of North American shale plays. Commercial Acumen & Risk Management - The company leverages its innovative supply chain and market fundamentals expertise. The company actively monitors and seeks to manage market volatility through diversification of price exposures and market access. Reporting Segments Ovintiv’s operations are focused on the exploration and development of oil, NGLs and natural gas reserves. The company is also focused on creating and capturing additional value through its market optimization segment. The company conducts a substantial portion of its business through subsidiaries. Ovintiv’s operating and reportable segments are USA Operations; Canadian Operations; and Market Optimization. USA Operations includes the exploration for, development of, and production of oil, NGLs, natural gas and other related activities within the United States. Plays in the U.S. include Permian in west Texas, Anadarko in west-central Oklahoma and Uinta in northeastern Utah. Canadian Operations includes the exploration for, development of, and production of oil, NGLs, natural gas and other related activities within Canada. Plays in Canada include Montney in northeast British Columbia and northwest Alberta and Horn River in northeast British Columbia. Market Optimization activities are managed by the Midstream, Marketing & Fundamentals team, which is primarily responsible for the sale of the company’s proprietary production to third-party customers while enhancing the associated netback price. Market Optimization activities also include third-party purchases and sales of product to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. Oil and Natural Gas Properties and Activities The U.S.A. Operations As of December 31, 2023, the USA Operations had an established land position of approximately 853,000 net acres, including approximately 162,000 net undeveloped acres. During 2023, the company completed an acquisition of Midland basin assets (‘Permian Acquisition’) which included approximately 1,050 net well locations and 65,000 net acres, which are located in close proximity to Ovintiv’s existing Permian operations. During 2023, the company divested its Bakken assets, which included approximately 46,000 net acres. Permian Permian is an oil play located in west Texas primarily in Midland, Martin, Howard, Glasscock, Andrews and Upton counties. The properties within the play are characterized by exposure of up to 10 potential producing horizons spanning approximately 3,000 feet of stratigraphy or stacked pay, an extensive production history and developed infrastructure. As of December 31, 2023, the company’s acreage comprises approximately 193,000 net acres in the play. The focus of development is on the Spraberry and Wolfcamp formations in the Midland basin, where Ovintiv holds a large position. The company has primarily developed the play using its cube development model and multi-frac techniques. Cube development utilizes multi-well pads and frac spreads running in parallel to simultaneously access multiple layers of stacked pay to maximize product recovery. In addition, during the second half of 2023, the company focused on integrating the Permian Acquisition, applying Ovintiv standards for well design, safety, cost management and team culture to the acquired Midland basin assets. Oil and natural gas facilities include field gathering systems, storage batteries, saltwater disposal systems, separation equipment and pumping units. The majority of Ovintiv’s acreage and associated oil production is dedicated under multiple pipeline gathering agreements, with varying remaining terms of less than 11 years with optional renewal terms. In the event of pipeline capacity constraints, Ovintiv’s oil production is trucked by various third parties. Natural gas is delivered by the company to the purchaser’s meter and pipeline interconnection point in the field. Anadarko Anadarko is a liquids-rich play located in west-central Oklahoma in Blaine, Canadian, Custer, Dewey, Garvin, Grady, Kingfisher, Major, McClain and Stephens counties. The majority of the Anadarko properties are located in the black oil window of the STACK, which comprises the Woodford, Meramec and Osage formations spanning up to 800 feet of stratigraphy, while the remaining properties located in the SCOOP comprises the Woodford, Sycamore, Caney and Springer formations spanning up to 1,150 feet of stratigraphy. The play is characterized by silt, shale and carbonate formations which provide multiple potential oil and natural gas targets making the play ideal for cube development and long laterals. As of December 31, 2023, the company’s acreage comprises approximately 351,000 net acres in the play, with development targeting liquids-rich prospects. The company is developing the play using its cube development model. The play has significant existing infrastructure and ample access to major pricing hubs, including Cushing, Oklahoma, the U.S. Gulf Coast, Mont Belvieu, Texas and Conway, Kansas, and a number of Mid-Continent natural gas pipelines. The company’s oil and natural gas production is gathered at various production facilities, with the majority of oil subsequently transported to sales points by pipeline or sold at and trucked from tank batteries. The majority of Ovintiv’s acreage and associated production is dedicated to long-term gathering and processing agreements with various third parties, which have remaining terms ranging from one to eight years. Uinta Uinta is an oil play located in northeastern Utah primarily in Duchesne and Uintah counties. The Uinta basin provides a deep inventory of multiple stacked oil horizons with approximately 2,600 feet of oil saturated reservoir rock. As of December 31, 2023, the company’s acreage comprises approximately 137,000 net acres in the play. Oil production from Uinta is waxy, ranging from yellow to black, and is transported from the lease by truck due to the high heat pour point characteristics of the oil. The company has one oil volume minimum delivery commitment that expires in 2025. Oil production that is not subject to sales commitments is sold monthly in spot markets or transported by rail to other markets, such as the Gulf Coast. Canadian Operations As of December 31, 2023, the Canadian Operations had an established land position of approximately 1.1 million net acres, including approximately 673,000 net undeveloped acres. Montney Montney is primarily a condensate-rich natural gas play located in northeast British Columbia and northwest Alberta. The play includes properties that are located in the Montney formation where Ovintiv is primarily targeting the development of condensate-rich locations, but also includes landholdings with incremental producing formations, such as Cadomin and Doig. The Montney formation is characterized by up to six stacked horizons spanning over 1,000 feet of stratigraphy and is being developed exclusively with horizontal well technology. In 2023, total production from the play averaged approximately 47.7 Mbbls/d of oil and NGLs and approximately 1,095 MMcf/d of natural gas. As of December 31, 2023, the company’s acreage comprised approximately 811,000 net acres and 441,000 net undeveloped acres in the play. Ovintiv utilizes cube development to precisely place and space each well drilled to maximize value and resource extraction within the productive pay. During 2023, Ovintiv focused on drilling longer laterals and completing wells faster while improving frac placement efficiency and productivity. Drilling, completions and production efficiencies were captured by stacking innovation initiatives, such as rotary steerable systems, redesigned drill bits, motor optimization, real time frac optimization and high-rate facilities designs. Ovintiv also focused on reducing its emissions footprint by implementing well sites with nitrogen air gas instruments and frac fleets operating on natural gas. Ovintiv has access to natural gas processing capacity of approximately 1,562 MMcf/d, of which approximately 1,340 MMcf/d is under contract with third parties under varying terms and duration and approximately 222 MMcf/d of processing capacity, which is owned by the company. In addition, Ovintiv has access to liquids handling capacity of approximately 125 Mbbls/d of which approximately 93 Mbbls/d is contracted with third parties under varying terms and duration, and approximately 32 Mbbls/d is owned by the company. Other Operations Horn River Horn River is located in northeast British Columbia, where development was historically in the Horn River Basin shales (Muskwa, Otter Park and Evie), which are upwards of 500 feet thick. In 2023, the company’s natural gas production averaged approximately 26 MMcf/d. As of December 31, 2023, the company’s acreage comprised approximately 186,000 net acres in the play. Ovintiv owns an interest in natural gas compression capacity in Horn River of approximately 285 MMcf/d at various facilities in the area. Ovintiv has a take or pay commitment under the Cabin plant natural gas processing arrangement with a third-party, which has a remaining term of nine years. Marketing Activities Market Optimization activities are managed by Ovintiv’s Midstream, Marketing & Fundamentals team, which is responsible for the sale of the company’s proprietary production and enhancing the associated netback price. In marketing its production, Ovintiv looks to minimize market related curtailment, maximize realized prices and manage concentration of credit-risk exposure. Market Optimization activities include third-party purchases and sales of product to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. Ovintiv’s produced oil, NGLs and natural gas, are primarily marketed to refiners, local distributing companies, energy marketing companies and aggregators. Ovintiv’s oil production is sold under short-term and long-term contracts that range up to two years or under dedication agreements, for which prices received by Ovintiv are based primarily upon the prevailing index prices in the relevant region where the product is sold. The company also has firm transport contracts to deliver oil to other downstream markets. Ovintiv’s NGLs production is sold under short-term and long-term contracts that range up to eight years, or under dedication arrangements at the relevant market price at the time the product is sold. Ovintiv’s natural gas production is sold under short-term and long-term delivery contracts with terms ranging up to one year in duration, at the relevant monthly or daily market price at the time the product is sold. The company also has firm transport contracts to deliver natural gas production to other downstream markets, including Dawn and Chicago. The company enters into various contractual agreements to sell oil, NGLs and natural gas, some of which require the delivery of fixed and determinable quantities. As of December 31, 2023, the company was committed to deliver approximately 22.7 MMbbls of oil and approximately 40 MMcf of natural gas in the USA Operations and approximately 7.3 MMbbls of oil and NGLs and approximately 61.9 MMcf of natural gas in the Canadian Operations with varying contract terms. The company has one oil minimum volume sales contract related to Uinta production in Utah. Major Customers In connection with the marketing and sale of the company’s oil, NGLs and natural gas production and purchased product for the year ended December 31, 2023, the company had one customer, which individually accounted for more than 10 percent of the company’s consolidated revenues. Regulatory Matters Certain of the company’s U.S. oil and natural gas leases are granted or approved by the federal government and administered by the Bureau of Indian Affairs, the Office of Natural Resources Revenue (‘ONRR’) or the Bureau of Land Management (‘BLM’), all of which are federal agencies. History The company was incorporated in Delaware in 2020. It was formerly known as Encana Corporation and changed its name to Ovintiv Inc. in January 2020.