Husky has set financial and operational targets over the 2017 timeframe to deliver predictable value to shareholders, including a top-tier dividend.
Performance targets include:
- A compound annual production growth rate (CAGR) target of five to eight percent.
- Cash flow target of six to eight percent compound annual growth.
- Annual reserve replacement average greater than 140 percent.
In 2013, Husky continued to provide a top-tier dividend. This resulted in shareholders receiving the highest percentage of cash compared to its industry peers, along with the highest overall return over three years.
Net Earnings and Cash Flow
Net earnings in 2013 were approximately 2.0 billion, excluding a $204 million non-cash impairment on dry gas assets in Western Canada. Cash flow from operations for the year was $5.2 billion.
Production and Throughputs
Production in 2013 was 312,000 barrels of oil equivalent per day, within annual guidance and in line with the Company’s plans to grow production five to eight percent on a compound annual basis over the 2017 timeframe.
Throughput at the Company’s refineries and upgrader averaged 317,000 barrels per day, reflecting scheduled maintenance at its refineries in Lloydminster and Prince George and a major turnaround at the Lloydminster Upgrader.
Reserves growth continued to outpace production, with an average proved three-year reserves replacement ratio between 2011 and 2013 of 172 percent, excluding economic factors. Including economic revisions, the average three-year proved reserves replacement ratio was 154 percent, ahead of the Company’s five-year average target of 140 percent per year.
Reserves growth during the year reflected the addition of reserves in Husky’s oil sands business, the full-scale development of the Ansell liquids-rich gas resource play and increased heavy oil recovery from thermal developments in Western Canada.
At the end of 2013, Husky had total proved reserves before royalties of 1.3 billion barrels of oil equivalent (boe), probable reserves of 1.9 billion boe and best estimate contingent resources of 13.2 billion boe. Its Oil Sands portfolio was responsible for 11.6 billion boe of the best estimate contingent resources total.