Ovintiv(US:OVV)2024-05-07 21:09Commodity Price Risk - The company reported a commodity price risk exposure, with a potential unrealized loss of $120 million for oil prices and $52 million for natural gas prices under a 10% price decrease scenario[268]. - The company’s realized pricing is primarily driven by the prevailing worldwide price for oil and spot market prices for natural gas, indicating significant volatility in revenues[268]. Interest Rate Sensitivity - As of March 31, 2024, the company had $745 million in floating rate revolving credit and term loan borrowings, with a sensitivity of $7 million for each 1% change in interest rates[277]. Foreign Currency Exchange Risk - A 10% fluctuation in foreign currency exchange rates could result in unrealized gains of $124 million or losses of $152 million impacting pre-tax net earnings[275]. - The company has entered into $301 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.3622 to US$, maturing monthly through the remainder of 2024[273]. - The company’s capital investment and operational expenses are subject to fluctuations in foreign exchange rates, impacting overall financial results[272]. Market Risk Management - The company is actively managing its exposure to market risks through various derivative financial instruments, including futures and options[268]. Operational Efficiency and Innovation - The company anticipates continued focus on technology and innovation, including advanced drilling techniques, to enhance operational efficiency and production[23]. - The company has outlined expectations for future production and commodity mix, emphasizing the importance of market conditions in strategic planning[23]. ESG Commitment - The company is committed to achieving its stated ESG goals and managing financial ratios to comply with covenants, reflecting a focus on sustainable practices[23].