Good morning. We would like to welcome everyone to the Canadian Natural Resources 2021 fourth quarter earnings conference call and webcast. After the presentation, we will conduct a question and answer session. Instructions will be given at that time. Please note that this call is being recorded today, March 3, 2022 at 10 A.M. Mountain Time. I would now like to turn the meeting over to your host for today's call, Corey Bieber, Executive Advisor. Please go ahead, Mr. Bieber.
Thank you, operator, and good morning, everyone, and welcome to Canadian Natural's fourth quarter 2021 corporate update conference call. Canadian Natural had an exceptionally strong quarter financially and operationally. As I commented before, I believe our asset base is unique amongst our peer group, underpinned by long life, low decline assets and complemented by our conventional assets that allow significant flexibility, all of which can generate significant free cash flow. Again, all of which was strongly demonstrated in Q4. Beyond our robust asset base, there's a corporate strategy that focuses on generating real returns for shareholders and a driven management team and corporate culture that focuses on being effective and efficient. Over the years, Canadian Natural has differentiated itself through its robustness, sustainability and strength of its business plan.
For 2022 and beyond, I believe we are one of the few energy companies capable of delivering meaningful economic growth while increasing sustainable returns to shareholders and reducing absolute debt in a responsible manner. For today's call, Tim McKay, our President, will first provide a corporate update. Darren Fichter, COO of E&P, will update our 2021 reserves, and Mark Stainthorpe, Chief Financial Officer, will then provide an update on our 2022 financial outlook, as well as our strong financial position. Tim will then provide a summary prior to opening up for questions. Before we kick off, I'd like to remind you of our forward-looking statements. Of note in our reported disclosures is that everything will be in Canadian dollars unless otherwise stated. As well, we report our reserves and production before royalties. I would also suggest you review our comments on non-GAAP disclosures.
With that, I'll turn it over to you, Tim.
Thank you, Corey. Good morning, everyone. Canadian Natural delivered strong operational results in the fourth quarter of 2021, as we achieved record quarterly production of approximately 1.314 million BOE a day, of which over 1 million barrels a day was liquid production, a result of our robust long life low-decline assets and operational excellence, primarily in the oil sands mining and thermal in situ. This, combined with our capital discipline, generated significant free cash flow, and we continued to allocate free cash flow through our four pillars of capital allocation, maximizing value for our shareholders. In 2021, we reduced net debt to approximately CAD 15 billion, returned approximately CAD 3.8 billion to shareholders through dividend and share repurchase. We maintained capital discipline and executed on opportunistic acquisitions which added long-term value.
We continued to apply that same drive to ESG, environmental, social and governance, to deliver industry-leading performance across the board, a significant factor in our long-term sustainability. Canadian Natural targets to publish its 2021 stewardship report to stakeholders in Q2 2022, including our third-party independent reasonable assurance on Scope 1 and Scope 2 emissions, and limited assurance on Scope 3 emissions. Additionally, we will continue to outline our path to lower carbon emissions across the asset base and our journey to achieve our goal of net zero GHG emissions in the oil sands. We'll also display how Canadian Natural leverages technology innovation to reduce its environmental footprint, ensuring safe, reliable, effective, and efficient operations. Canadian Natural has multiple pathways to achieve net zero, with actions identified in the near, mid, and long term.
The strength of Canadian Natural's oil sands mining assets is that with its long life, no decline, and with its manufacturing-like operations, we have one of the clearest routes, if not the clearest route, to net zero of any global oil asset. I'll now do a brief overview of our assets, starting with natural gas. Overall, 2021 annual natural gas production was approximately 1.695 Bcf per day. This was a 15% increase over 2020 production. For North American operations, 2021 annual natural gas production was approximately 1.68 Bcf versus 1.4 in 2020, which was primarily a result of the company's strategic decision to invest in the company's liquid rich Montney areas through this drill to fill strategy, adding low cost, high value liquid rich natural gas production lines.
As well as opportunistic acquisitions completed in 2020 and 2021, the last being Storm Resources in mid-December of 2021, which we will target to drill 14 net wells on the asset as part of our 2022 capital budget. Our 2021 annual North American natural gas operating cost was CAD 1.15 per Mcf, which is comparable to 2020 of CAD 1.14. For the fourth quarter of 2021, North American natural gas production was approximately 1.841 Bcf per day versus 1.623 Bcf per day for Q4 2020. Strong operating cost of CAD 1.02 per Mcf versus Q4 2020 of CAD 1.07.
Good year-over-year operating cost performance as our teams continue to focus on operational excellence. Looking forward on the annual strip basis, diesel prices for 2022 look very strong, approximately CAD 425 per gigajoule, an increase of approximately 26% over 2021 levels of CAD 338 per gigajoule, improving the economics of our Montney liquids-rich natural gas projects. North American light oil and NGL 2021 annual production was 94,581 barrels a day, up 12% from 2020, primarily a result of strong drilling results. Annual operating costs are strong at CAD 28 per barrel, compared to 2020 operating costs of CAD 14.61 per barrel.
Q4 production, 97,799 barrels a day, up 11% when comparing to Q4 2020, with operating costs of CAD 14.51 per barrel, as compared to the Q4 2020 operating cost of CAD 15.88 per barrel. The company delivered top-tier execution and results at the company's high-value Montney light crude development in Whitby in 2021 were very good. As budgeted, a total of 18 net wells were brought on stream in 2021, with effective rates exceeding the targeted budget rate by over 25%, totaling approximately 11,000 barrels a day of light crude oil and 35 million a day of natural gas. In 12 months, capital efficiencies were approximately CAD 6,000 a barrel. Based on the success, Canadian Natural targets to complete 15 net wells as part of our 2022 capital budget.
We targeted to maintain the process facility at full capacity for this year. Our international assets in 2021 had an annual production of 31,610 barrels, a decrease of 2020 levels, primarily due to maintenance activities and natural declines. Offshore Africa production was approximately 14,000 barrels a day versus 2020 of 17,000 barrels per day. Annual operating costs for in 2021 was 1,873 per barrel versus 2020 of 1,829. In the North Sea, annual production averaged 20,633 barrels a day in 2021 versus 23,142 in 2020. Our international assets continue to generate free cash flow and value for the company. Moving to heavy oil.
Annual production was 64,366 barrels per day in 2021 versus the 70,279 in 2020, reflecting natural decline, partially offset by strong drilling results and increased development activity in 2021. Annual operating costs were CAD 19.37 per barrel versus the 2020 operating cost of CAD 17.59. Fourth quarter 2021 production was 64,866 barrels a day, primarily a result of strong drilling results and increased development activity, versus the Q4 production of 65,713 barrels a day. While operating costs were CAD 19.72 per barrel versus the Q4 2020 of CAD 17.61, primarily a result of higher energy costs.
At the company's Clearwater Play at Smith, 12 net horizontal multilaterals were brought on stream in 2021 and continued to perform well, with the current production rates totaling over 3,200 barrels a day. As part of our 2022 budget, the company has commenced a 2-rig drilling program targeting 41 net horizontal wells to be drilled based on production during the year. A key component of our long life, low decline assets is our world-class Pelican Lake pool, where leading-edge polymer flood continues to deliver significant value. The 2021 annual production was 64,390 barrels a day versus 2020 average of 56,535 barrels a day, only a 4% decline, reflecting the very low decline of the property. The team continues to do a great job.
We have strong operating costs of CAD 675 per barrel, an increase from 2020 operating cost of CAD 603, primarily the result of increased energy costs. Q4 2021 production was approximately 52,963 barrels per day, down from the fourth quarter of 2020 of 56,000 barrels a day. Operating costs in Q4 2021 were CAD 678 per barrel, with higher energy costs versus CAD 585 for Q4 2020. With our very low decline and very low operating costs, Pelican Lake continues to have excellent netbacks. We had a very strong year in our thermal and in situ operations in 2021, as we continued to leverage our continuous improvement culture and our expertise to deliver effective and efficient operations.
In 2021, we achieved record annual production of 269,284 barrels a day as the teams optimized production throughout the year. Thermal annual operating costs were CAD 12.14 a barrel, up from 2020 levels of CAD 9.24, primarily a result of increased energy costs. Q4 2021 production was very strong at 262,110 barrels a day, up from the Q3 production of roughly 248,000 barrels a day. The operating cost was CAD 13.08 a barrel. When comparing last year's Q4 2020 production, it's very similar, which was at 266,000 barrels a day with operating costs of CAD 12.24 per barrel.
As part of our 2022 strategic growth capital, the company has commenced a 3-rig drill program in thermal that will conclude in Q2 2022. This program targets to drill 3 pads at Kirby, 2 pads at Cactus, targeting onstream production volumes in mid-2023, with an average capital efficiency of approximately CAD 8,000 per BOE. At Termo, the program consists of 1 SAGD pad as well as 2 CSS pads targeted to be onstream in mid-2023, with average capital efficiency of approximately CAD 10,000 to be achieved. Canadian Natural is progressing its engineering and design of a commercial scale solvent SAGD pad development at Turbo North and targets to commence solvent injection early 2024.
In the company's world-class Oil Sands Mining and Upgrading assets, we had a record annual production averaging 448,133 barrels a day of SCO, an increase of 7% from 2020 levels, primarily a result of high utilization rate and operational enhancements. The team had strong annual operating costs in 2021 and remained industry leading, averaging CAD 20.91 per barrel of SCO versus the 2020 operating cost of CAD 24.06 per barrel, driven by the company's continuous focus on high reliability, cost control, as well as operational enhancement. At our Oil Sands Mining operations, we had a record production in Q4 2021, which was 492,406 barrels a day as the planned maintenance was completed at Horizon and Athabasca Oil Sands Project earlier in the year, and the facilities ran well at expanded capacity.
In the quarter, operating costs were strong at CAD 19.55 per barrel with FCO as our teams strived for operational excellence. In the lead up to the planned turnaround at the non-operated Flat Prid operation, we have had operational issues in the first quarter impacting Canadian Natural's Q1 2022 production volumes of approximately 31,000 barrels a day. The turnaround is still targeting to begin March fifteenth for approximately 65 days, as previously announced. At Horizon, the turnaround is targeted for May for a full plant outage for approximately 30 days. Overall, the 2022 annual production target range remains unchanged. I will now turn it over to Darren for our 2021 reserve review.
Thank you, Tim, and good morning. As in previous years, 100% of Canadian Natural reserves are externally evaluated and reviewed by independent qualified reserve evaluators. The 2021 reserve disclosure is presented in accordance with Canadian re-reporting requirements using forecast prices and estimated costs. Canada also require disclosure of reserves on a company working interest share before royalty cases. As you just heard from Tim, Canadian Natural had another excellent year, and the results are also demonstrated in Canadian Natural reserves. Total proved and total proved plus probable reserves increased 6% to 12.8 billion BOE and 17 billion BOE. Of the 12.8 billion BOE of total proved reserves, 8.9 billion BOE are proved developed producing reserves.
It is important to note that 55% of Canadian Natural's total proved reserves are high value, no decline SCO reserves at 7 billion BOE. Finding and development costs and reserve replacements are key indicators of the strength of our assets. In 2021, Canadian Natural delivered top-tier results, and our strong performance is reflected in our finding and development costs and reserve replacement. The corporate finding, development and acquisition costs, including changes in future development costs, are CAD 5.88 per BOE for total proved, and CAD 5.49 per BOE for total proved plus probable reserves. Canadian Natural replaced 2021 production by 267% for total proved and 328% for total proved plus probable reserves.
As evidence of Canadian Natural's long life, low decline asset base, 77% of total proved reserves are long life, low decline, resulting in our top-tier total proved reserve life index of 30 years. A total proved plus probable reserve life index of 40 years. The net present value of future net revenue before income taxes using a 10% discount rate and including the full company ARO is CAD 120 billion for total proved reserves and CAD 146 billion for total proved plus probable reserves. In summary, these excellent results reflect the strength and depth of Canadian Natural's asset base, the value of the company's long life, low decline reserves, and our ability to execute. Now I will hand over to Mark for the financial highlights.
Thanks, Darren, and good morning, everyone. The 4th quarter was strong operationally and financially as we delivered significant earnings of over CAD 2.5 billion and adjusted funds flow of over CAD 4.3 billion. Free cash flow was approximately CAD 3 billion from capital and dividends, excluding acquisitions in the quarter. As a result of our significant free cash flow generation in Q4, net debt decreased by approximately CAD 1.9 billion from Q3 levels. This resulted in year-end net debt of under CAD 14 billion, a reduction of over CAD 7.3 billion through 2021. As part of our financial strength, we continue to maintain strong liquidity, including revolving bank facilities, cash and short-term investments. Liquidity at year-end was approximately CAD 7.2 billion. Returns to shareholders were also significant in the quarter, with approximately CAD 1.4 billion returned through dividends and share repurchases.
Per our previously disclosed free cash flow allocation policy, with net debt now below CAD 15 billion, target free cash flow, as defined in the policy, will be allocated 50% to share repurchases and 50% to the balance sheet. That target delivers significant increases in shareholder returns as well as continued financial strength. Our long life, low decline assets support a sustainable, growing and predictable dividend. This was evidenced through the period of challenging commodity prices in 2020, where we increased and maintained our dividend. In 2021, the dividend was further increased in March and November for a combined 38% increase. On March 2, or yesterday, the board of directors has approved a further 28% increase to our quarterly dividend to CAD 0.75 per share, payable April 5, 2022.
This continues the company's leading track record of 20 consecutive years of dividend increases with a significant compound annual growth rate of 22% over that period of time. This increase in the quarterly dividend demonstrates the confidence the board of directors has in the company's world-class assets and its ability to generate significant and sustainable free cash flow. Our asset base is underpinned by top-tier, long life, low decline assets, a strong balance sheet, and effective and efficient operations that drive an industry leading US dollar debt to EBITDA even in the mid-30s per barrel, which covers our base maintenance capital requirements and the increased dividend commitment, maximizing value for our shareholders.
Additionally, year to date, up to and including March 6, the company has returned approximately CAD 680 million to shareholders through repurchase and cancellation of 10.5 million common shares, and the board of directors has approved renewal and increase of the company's Normal Course Issuer Bid. The approval states that during the 12-month period commencing March 11, 2022 and ending March 10, 2023, the company can repurchase for cancellation up to 10% of the public float, subject to TSX approval. We continue to balance our four pillars of capital allocation with increased returns to shareholders, further debt reduction, ability to provide economic resource development, and execute on opportunistic acquisitions.
This clearly demonstrates the sustainability of our business model, the ability of our unique long life, low decline asset base with low maintenance capital requirements, and effective and efficient operations to generate significant long-term shareholder value. Before I hand it back to Tim for closing comments, I did want to acknowledge Corey, as this will be his last conference call, as he is retiring in April. Corey, you've had an exceptional career, including 21 years at Canadian Natural, and we all appreciate your significant contributions to the company's success. On a more personal note, I'd like to thank you for your leadership, mentorship, guidance, and friendship over our many years working together. We wish you all the best in retirement. With that, I'll turn it back to you, Tim.
Thanks, Mark. Canadian Natural has advantage because of our ability to effectively allocate cash flow to our core pillars. We have a well balanced, diverse and large asset base with a significant portion of which is long life, low decline assets, which requires less capital to maintain volumes. To balance our commodities in 2021, with approximately 47% of our BOE being crude oil and SCO, 30% heavy, and 23% natural gas, which lessens our exposure to volatility in any one commodity as we move through 2022. We will continue to allocate cash flow through our four pillars in a disciplined manner to maximize value for our shareholders. This is all driven by effective capital allocation, effective and efficient operations, and by our teams who deliver top tier results. We have a robust, sustainable free cash flow.
Through our free cash flow policy, allocation policy, returns to shareholders are significant. For 2021, approximately CAD 2.2 billion in dividends and CAD 1.6 billion in share repurchases for a total of CAD 3.8 billion dollars. Today, our dividend was increased by 28% for the 22nd consecutive year. It has a CAGR of 22% over that time. In summary, we'll continue to focus on safe, reliable operations and enhancing our top tier operations. We'll continue to drive our environmental performance. We are in a very strong position, and being nimble enhances our capacity to create value for our shareholders. Canadian Natural is delivering top three cash flow generation, which is unique, sustainable, and robust, and clearly demonstrates our ability to economically grow the business and deliver returns to shareholders by balancing our four pillars.
With that, we'll open up the call to questions.
Your first question comes from the line of Greg Pardy with RBC Capital Markets. Please proceed with your question.
Thanks. Good morning, and great quarter again on you guys and fond farewell, Corey. Sad to see you go. We'll have to play some craps in Las Vegas. Just one question then is really around marketing and on the nat gas side. One of the questions that's come up in the market is whether you would be willing or would even contemplate entering into like a longer term supply arrangement in connection with LNG or whether the marketing strategy is still, you know, centered around selling most of your gas at AECO.
You know, it's a really good question, Greg. I think you know, we generally don't go into a long-term marketing agreement unless it's something that we feel we have an opportunity to you know, gain some
Diversification and not overexposure to one market or another. You know, it's difficult to say at this time. You know, when the LNG project is finally get up and running, obviously being one of the largest producers of natural gas, there may be an opportunity to do some kind of agreement there. Right now, at this time, there's nothing on the table.
Okay. Terrific. Thanks again.
Your next question comes from the line of Neil Mehta with Goldman Sachs.
Good morning, team. Corey, congratulations as well. It's been a terrific run, especially here over the last few years. Congratulations to you, sir.
Thank you, Neil.
The first question, it's obviously a very dynamic crude market environment right now, but particularly in the heavy markets with barrels potentially being taken out of the market. I'd be curious from your guys' perspective, what this all means for Western Canadian crude. Does that create a structural bid on the commodity, even if there are potentially Iranian barrels coming back to the market. Curious on your perspective of the geopolitics support piece for WCS in the near term and long term.
You know, even before the geopolitical piece there, you know, if you looked at the heavy oil market, it was very robust. There was a period of time when the differentials had gone wider, but that was primarily due to apportionment here in Alberta. We've always felt that, you know, there shouldn't have been an apportionment issue. With the additional egress, I just looked at the market for the crude to the Gulf Coast is very strong, and the differentials seem to support that view.
Tim, with the strengthening of the curves here, although a lot of it's been deferred, does it change any of the growth ambitions that you laid out a couple months ago, around the next couple of years? Or is it very much stay the course?
It's very much stay the course. You know, we're always, you know, always looking ahead on the market. You know, we came up with what I felt was a very strong budget. You know, one that we believe, you know, has some near-term growth as well as a very balanced out outlook for long term. Just being, you know, efficient, effective with our drilling program is key and keeping our costs under control.
Yep. All right. Thanks, Tim.
Your next question comes from the line of Manav Gupta with Credit Suisse.
First of all, I really wanted to thank Corey. Over the years you were super helpful, and you were very patient even when our questions were outright dumb and stupid. Thank you for that, Corey.
Thank you, Manav. Appreciate it.
My question here is, you have now done two good deals, Painted Pony and Storm. Painted Pony closed somewhere in October 2020. I just wanted to understand from the point where that you wanted those assets to the point where you now have them and they're operating, have they met your expectations? Have you been able to achieve the synergies that you set out when you wanted to take on, you know, Painted Pony? And again, as far as Storm is, I understand it's been about two months, but are the assets in general meeting your expectations?
Yeah, the assets are doing very, very well. From a reserve point of view, they're actually better than what we had anticipated. You know, with Storm assets, in the near term, we've been able to grow the production from what today it's around 170 million a day and 9,000 barrels a day. Yeah, the properties have been very good and very accretive.
Thank you for taking my question.
Your next question comes from the line of Phil Gresh with J.P. Morgan.
Yes. Hi, good morning. I'm gonna throw my congratulations to Corey as well. One question from Mark. Not sure if you're willing to answer this one, but in the past, sometimes you guys have been willing to talk about how you, the CFO, would look at strip. Obviously it's incredibly volatile right now, but anything you'd be willing to share on that front?
Yeah, if you're thinking about, you know, CFO versus adjusted funds flow, there will be some changes there too. Just as you look at accruals going in a backwardated market and how we, you know, manage accrual accounting in the last month and then hit peak oil in the following month, there'll be some instances of that as well. On an overall basis, it really depends in this market, you know, with the changes in pricing and, you know, differentials and, you know, with the Canadian dollar, the U.S. dollar being strong, it really depends. You know, we can sit back and model with you and look at what your assumptions are and how it relates to cash flow overall. You know, it's very strong.
The free cash flow itself is very strong because you've got a, you know, a proven capital program, and a dividend that's very sustainable, as we talked about in kind of the mid-teens area. The free cash flow potential here is quite strong.
Yeah. No. Fair enough. Then I guess, are you seeing any, you know, risks at this point from the inflationary environment? I know obviously you talked a little bit about natural gas impacts to OpEx, but just curious. Back to your capital budget, any pressures you might be seeing there in 2022.
Yeah. Phil, it's Tim here. Thank you for the question here. Yeah, we're seeing some inflationary pressures, a little bit on labor. You know, obviously the fuel, whether it's diesel or natural gas is, you know, kind of roll through. You know, having said that, you know, our expenses on the drilling side, the drilling team is doing an excellent job in terms of maintaining our costs and mitigating those inflationary pressures on the drilling side. That part's going very well. You know, the teams are very focused on what we can control and what we can do to mitigate the inflationary impacts.
When you get to more on the facility side, where you're using a large amount of steel, we are seeing you know inflationary pressures probably in that 20% range. You know, it's very early here yet. You know, I have to emphasize our teams are doing a great job in terms of looking at ways to mitigate that inflationary pressure.
Okay. Got it. Sorry, one last one from Mark. Do you have an update on the post payout for Horizon? Has that pulled forward? I think you had said maybe second half of 2022 previously, if I remember correctly. What's just your latest thoughts there? Thank you.
Yeah. With the increase in pricing here, it would have moved forward. We're probably actually in the March, April timeframe, depending on the sale of Horizon. As you indicated, the sale was, of course, in our budget for 2022. It just shows some timing based on the sale price or commodity prices.
Yeah. Okay. Got it. Thank you.
Thanks, Phil.
Your next question comes from the line of Dennis Fong with CIBC Capital Markets.
Hi, good morning, and thank you for taking my questions. I'll just throw my name in, then add as well for congratulations to Corey. The question I have really just relates back to ideal capital structure, given you know, quite strong crude oil prices, and your outlined allocation of 50/50 asset-based CapEx and the dividends between debt payment and buybacks. How should we be thinking about potentially getting to something that's well below the CAD 15 billion level? How are you looking at potentially balancing that versus allocating more capital and share buybacks and so forth? Obviously keeping in mind kind of the four pillars that you've been focusing on, what the best allocation use of capital have to be.
Hey, Dennis, it's Mark. Thanks for the question. It's yeah, you know, we've got now a free cash flow allocation policy that is keeping, as you indicate, where we're allocating 50% to the share buyback program and 50% to the balance sheet. You know, we'll execute along those lines as we go through the year and we manage that based on, you know, the pricing and the free cash flow profiles. I think what's important just to recognize, one is, yes, the balance sheet is certainly strong, and you could argue that, you know, it's in a good place to go forward, of course.
I think what you gotta just recognize the ability for us to just balance those four pillars and be able to kind of deliver on all of them, particularly in this environment, to a significant extent. I think that's unique. It's part of, you know, the asset base that's been developed here being long life, low decline. It gives us that opportunity, you know, to have an increase in sustainable dividend, buy back shares, pay down debt, grow the business, and look at opportunistic opportunities when they present themselves. To me, it's a very unique position.
Great. No, and the other questions I had have already been answered, so I'll turn it back. Thank you.
Thanks, Dennis.
Your next question comes from the line of Doug Leggate with Bank of America.
Thanks, Phil. Good morning, everyone. I appreciate you having me on the call. Corey, thanks for helping us get right to it and embarrassing us with us coming for congratulations to you as well. Mark, this is probably for you. I guess it's kind of a follow-up on the capital structure. A number of your peers talk about, you know, comfortably living with a portfolio of between, if you like, including the dividend sources for about $40. You're obviously well below that. I'm just curious how you think about the right level of dividend and whether you'd be given the obvious perfect performance of the portfolio, whether you'd be prepared to continue to move up that way even. In other words, headroom for continued, you know, outsized dividend increases.
Yeah. Well, okay, first off, I think when you look at a dividend and what the board really considers paramount to it is the sustainability of it through cycles. You know, we look at that to make sure that once a dividend is, you know, declared that we're not having to take it back. That's why you see, you know, steady increase, predictable increases year after year. We've talked about it today, 22 straight years. That's a very key component of our dividend. We want it to be sustainable and it's an increasing. There's different ways, of course, to kind of break evens on a continuous improvement in costs and growing production and paying down debt is another way to help with interest costs and things like that.
There's other parts of the equation that can help deliver or sustain a lower breakeven. In reality, when you look at the asset base, again, with the long life and low decline nature of it and the cost structure we've been able to build over time, really sets that apart and helps maintain that low breakeven.
Okay. I appreciate that. In terms of dividend policy, do you expect to reach that break even in that like traditional level or would you be open to that moving higher to accommodate a higher dividend over time?
Well, I think again, it's about being consistent and being sustainable over time. Those factors change, you know, all the time. The board is looking at those every quarter when they set the dividend.
Yeah.
Yeah. In perspective, remember, 2020, we averaged $89 WTI. You know, the board is really focused on making sure we have a robust, sustainable growing dividend. To me, to be in mid-$30s today is a very enviable position, but you don't wanna get too far ahead of yourself.
Thank you. My follow-up, I'm not sure who wants to take this, but it's really just a housekeeping note on British Columbia permitting. Our understanding is that there's some changes in leadership that things might be improving there. I'm just wondering if you could give us a quick update. Thanks.
Yeah. In BC, there's really no change. As far as we know, the OGC is still working through a greements with Tre . There's talk that there may be some opening up of some of the low risk or low impact permits, but we haven't seen anything that I'm aware of today.
Sounds good.
Okay. Thank you. Thanks for the question.
At this time, there are no further questions. I would now like to turn the call back over to management for any closing remarks.
Thank you, operator. Before signing off, I want to thank Jim and the rest of the management committee for creating and sustaining such a strong corporate culture. I'd also say our strong culture and focus on delivering value to shareholders, coupled with the depth of talent across our organization, provides for seamless transitions in leadership, and we've repeatedly seen that over the years. Thank you all to the numerous income and equity investors, analysts and banks I've spoken with over the years. I learned a lot from each one of you and appreciate the relationships we've developed over the years. With that, thank you to everybody who's joined us on the webcast. If you have any questions, please don't hesitate to call.
Thank you. That does conclude today's conference. Thank you for participating. You may now disconnect.