Core Viewpoint - Baytex Energy Corp. has strengthened its financial position through the strategic divestiture of U.S. assets, focusing on its high-return Canadian energy platform and committing to return a significant portion of net proceeds to shareholders in 2026 [2][17][18]. Financial Performance - The company entered 2026 with a net cash position of approximately $857 million after repaying outstanding credit facilities and redeeming senior notes [17][18]. - Baytex plans to prioritize share buybacks while maintaining an annual dividend of $0.09 per share [18][19]. Production and Operations - Consolidated production averaged 137,087 boe/d in Q4 2025, with an annual production of 145,079 boe/d for the year [3]. - Canadian production averaged 67,295 boe/d in Q4 2025, with an annual production of 65,528 boe/d, reflecting a 6% growth rate compared to 2024 [4]. - For 2026, the company targets annual production of 67,000 to 69,000 boe/d with exploration and development expenditures of $550 to $625 million [4][11]. Reserves Growth - Year-end 2025 reserves in Canada showed solid growth across all categories: PDP reserves increased by 12% to 69 MMboe, 1P reserves by 15% to 151 MMboe, and 2P reserves by 9% to 282 MMboe [10][23]. - The company achieved a strong PDP F&D recycle ratio of 2.0x and a 1P and 2P F&D recycle ratio of 2.1x based on a 2025 operating netback of $34.61/boe [10]. Development Plans - In the Duvernay, production is expected to increase by 35% to approximately 11,000 boe/d in 2026, with a target year-end exit rate of 14,000 to 15,000 boe/d [12]. - The heavy oil portfolio is expected to deliver stable production, with plans to bring 91 heavy oil wells onstream in 2026 [13]. Future Development Costs - Future development costs for proved reserves are estimated at $1,915 million, while for proved plus probable reserves, they are estimated at $3,432 million [45][46]. Market Outlook - The company anticipates a disciplined risk management approach, with approximately 45% of net heavy oil basis differential exposure hedged for 2026 [20][21].