Good morning and welcome to Whitecap Resources' Annual and Special Meeting being held this morning by audio webcast on the Lumi Meeting platform. I would now like to turn the conference over to Whitecap's Chairman of the Board, Mr. Ken Stickland. Please go ahead.
Thank you, Colin. Good morning, everyone. Welcome to the annual and special meeting of the shareholders of Whitecap Resources, Inc. The meeting will now come to order. As indicated, I am Ken Stickland and I am the Chairman of the Board of Directors of Whitecap Resources, Inc., and I will act as Chair of the meeting. Once again, the COVID-19 crisis prevents us from holding our meeting in person. It is therefore being hosted on the Lumi Virtual Shareholder Meeting platform. This allows registered shareholders to vote and to submit questions and comments to the moderator to be read and addressed at the meeting. If you have a question or comment, please submit it through the system.
Following the formal portion of our meeting today, Grant Fagerheim, our President and Chief Executive Officer, will make some brief remarks. After his remarks, he will address any questions.
Firstly, a couple of points of order. Shannon Gangl to act as secretary of the meeting. Jackie Fisher and Paul Bedard, representatives of Odyssey Trust Company, to act as scrutineers. I have received confirmation from Odyssey as to the due mailing of the meeting materials and the financial statements for the year ended December 31, 2020. I direct that this confirmation, together with copies of these documents, be kept by the secretary with the minutes of this meeting. Business may be transacted at this meeting if two or more persons are present holding or representing by proxy not less than 25% of the shares entitled to vote at the meeting. I've been advised that we have quorum, and as a result, I will direct the scrutineer's report to be kept by the secretary with the minutes of this meeting.
I now declare that this meeting is regularly called and properly constituted for the transaction of business. Today, we will conduct each vote by way of vote cast on the Lumi platform and those submitted by proxy. I understand that the scrutineers have tabulated all of the votes received prior to voting cutoff. If you have previously voted, you do not need to vote again when prompted.
By voting again, you will revoke any vote made prior to voting cutoff. We will now open voting for all of the resolutions. Particulars of the votes cast on all matters may be obtained from the Secretary after the meeting. I direct that the scrutineer's report on all matters be annexed to the minutes of this meeting as a schedule. I would first like to present the financial statements for the year ended December 31, 2020.
These are located on the Lumi dashboard page. The next item of business is to fix the number of directors.
My name is Thanh Kang, and I move that the number of directors to be elected at this meeting to be fixed at 10.
Thank you, Thanh.
My name is Janice Wood, and I second the motion.
Is there any discussion or questions submitted from any registered shareholder or proxy holder on that motion?
Mr. Chairman, there are no questions on that motion.
Thank you. The next item of business is the election of directors of Whitecap Resources, Inc. The advance notice date for the nomination of directors having passed under Whitecap's advance notice bylaw. The only individuals entitled to be nominated as directors at this meeting are the persons named as nominees in Whitecap's information circular.
Therefore, as directed by the board and in accordance with the information circular, Heather J. Culbert, Mary Jo Case, Grant B. Fagerheim, Gregory S. Fletcher, Daryl H. Gilbert, Glen A. McNamara, Stephen C. Nikiforok, myself, Kenneth S. Stickland, Bradley J. Wall, and Grant Zawalsky are nominated as directors of Whitecap Resources, Inc., to hold office until the next annual election of directors or until the successors are elected or appointed, subject to the provisions of the Business Corporations Act, Alberta, and the bylaws of Whitecap. The next item of business is the appointment of auditors.
I move that PricewaterhouseCoopers LLP be appointed auditors of Whitecap until the next annual meeting or until their successor is appointed and that the remuneration as such be fixed by the board of directors.
Thank you, Thanh.
I second the motion.
Thank you, Janice. The next item of business is the consideration of a special resolution to approve the amendment of articles to revise the share provisions relating to preferred shares.
I move that the special resolution on page 25 of the information circular, proxy statement of Whitecap Resources, Inc., dated March 5, 2021, be approved.
I second the motion.
Thank you, Janice. Is there any discussion or questions submitted from any registered shareholder or proxy holder on that motion?
There are no questions on that motion.
Thank you. The next item of business is to approve a non-binding advisory resolution concerning Whitecap's approach to executive compensation.
I move that the non-binding advisory resolution on page 27 of the information circular of Whitecap, dated March 5, 2021, be approved.
Thank you, Thanh.
I second the motion.
Thank you, Janice. Is there any discussion or questions submitted from any registered shareholder or proxy holder?
No questions on that motion.
Thank you. As voting has been enabled for all previous motions, if a shareholder has not voted yet, please do so now. Paul, is there any voting? Voting is now closed. Just wait for confirmation that the motions have passed. And I've received that I've been advised by the scrutineers that all resolutions have been approved by more than the requisite majority and that those nominated have been duly elected as directors of Whitecap Resources, Inc. I declare the motions carried and the nominees for the board of directors elected. Are there any questions submitted on the formal business of the meeting?
Mr. Chairman, there are no questions on the formal business of the meeting.
Will now then entertain a motion that the meeting be terminated?
I move that this meeting be terminated.
I second the motion.
Thank you. The meeting operator is activating a poll to vote on the termination of the meeting. That has been carried. I declare this meeting terminated and invite Mr. Fagerheim to deliver his remarks on the Whitecap management. Before I turn it over to Grant, I'd like to thank those who've joined us again this year for the meeting. I'd like to extend a special thanks to all our dedicated employees who've worked so hard this past year. It's been a very successful year for Whitecap, and in large part, their efforts have led to that, and a particular thank you to the senior management team. The dedication of the team on behalf of the shareholders is greatly appreciated. Grant, I turn it over to you. Thank you.
Thanks very much, Ken. I appreciate that. And I, too, want to thank our staff and our team here for the dedication they've provided to Whitecap over the past one-year period of time. I want to say good morning to everyone and thank you for your time and interest in attending our 2021 virtual AGM. I do hope that each of you and your family members have been able to remain healthy and safe, both physically and mentally, through this unparalleled disruptive time period in our lives.
Online with us today includes our full management team, along with many members of our valued Whitecap employees that continue to be strong, focused, and persevering at the office in the field or working from home if they choose to. I want to acknowledge our entire team for the commitment that each of you have made over the past year.
I also want to thank our pre-existing Whitecap staff, our new employees from NAL, TORC, and from industry that are ensuring that we are well prepared and stronger when we come to the other side of this difficult time. Our success can and will only continue with your efforts. Sincere thanks to each of you. Importantly, we also have our board of directors online with us today. The guidance and positive support through this past year have been invaluable and could not have happened without you caring and supporting our efforts. Thanks to each of you. We are pleased to welcome our newest director to our team, Mary Jo Case, who joins us today as a representative of the TORC shareholders. Welcome, Mary Jo.
By way of introduction, our directors include, as Ken had referenced before, our chairman who joined in 2013, Ken Stickland; Steve Nikiforok joined us in 2009; Grant Zawalsky in 2009; Greg Fletcher in 2010; Glen McNamara in 2010; Daryl Gilbert in 2015; Heather Culbert in 2017; Brad Wall in 2019; and Mary Jo Case here today in 2021. Myself, 2009 president and CEO, the start of Whitecap 11 years ago. As we are very well mindful of, 2020 brought with it unprecedented disruption to all of our individual lives, including our family life, work, and enjoyment activities, and we hope that everyone is doing their best to endure through this time period. I will briefly run through a summary of our 2020 year before I move forward with our thoughts and strategies on 2021.
We started the 2020 year with an active first quarter drilling program with 57 wells being drilled prior to the COVID pandemic that consumed us in mid-March. In response to the pandemic, we took a very assertive approach to protect our business and to ensure effective health and safety measures were in place for all of our office and field personnel. We undertook a deep dive analysis into our business to drive down costs where possible while ensuring we could remain sustainable operating entity going forward. Having crude prices trade down to minus -$37 for a short time period as a result of the OPEC+ overproduction into the demand destruction that took place as a result of the COVID environment is not a particularly enjoyable or comfortable place to be.
We prioritized our balance sheet by halting our drilling program in mid-March to reduce our capital outflow, reducing costs where possible, including the reduction of our monthly dividend payment. The combined efforts of the entire Whitecap team were exceptional, maintaining a positive get-it-done attitude, which allowed us to deliver strong financial and operational results while having an excellent health and safety record both in the field and in the office. From the end of the first quarter in 2020, we did not drill another well in 2020, but instead focused our activities on maintaining production as best we could with as little capital as possible, knowing that maintaining our balance sheet strength would be very important moving forward, allowing us to not only survive but to thrive on the other side of this difficult time that we were experiencing.
With our team having dropped out as much cost as we believed we could, we shifted our focus to gaining more size and scale and to become more market relevant with a primary focus on increased profitability and long-term sustainability. This led us to announcing the private company NAL business combination on August 30, 2020. This transaction brought to Whitecap a low decline production base with strong inventory of future drilling opportunities, a clean balance sheet, and a very experienced and capable staff. To our ownership group, we added a sizable shareholder in Manulife.
The transaction provided for a lengthy closing to the January 4, 2021 date, which closed earlier this year. We followed up on the NAL transaction with the announcement to combine with the publicly traded TORC Oil & Gas, who were also understanding that size and scale will be important going forward.
TORC was an exceptionally well-run with an enviable netback, long inventory of drilling locations, a high-performing complement of both office and field personnel, and a very supportive anchor shareholder in Canada Pension Plan. We proceeded to close the TORC transaction earlier this year on February the 24th. The result is a summary of our activities in 2020, pretty good, I must say, with the compliments to our entire team. Production of 68,662 BOE per day, 84% oil and liquids, on a disciplined capital program of CAD 195.9 million, which was reduced from our original budget of between CAD 360 million to CAD 380 million. Despite the lower capital, we fully replaced our production and maintained our reserve balance year over year on both proven and proven plus probable reserve categories.
We generated funds flow of CAD 434 million, which allowed us to reduce debt by CAD 110 million while providing our shareholders with dividend payments of CAD 87.3 million. We sequestered and stored 2 million tons of CO2 at our Weyburn CO2 project, more than offsetting our direct and indirect emissions by 600,000 tons. We reduced our environmental release volumes by 36% year over year through an active asset integrity program and early detection systems, and we maintained an exceptionally strong safety and environmental performance throughout the year. Now on to 2021. I must admit that we are excited. When we exited 2020 and turned the page to 2021, our team is very excited about our opportunities for creating value for our shareholders that includes all of our employees.
We are very pleased to have the new Whitecap personnel join us from NAL, from TORC, and from the energy industry for what we can now call Whitecap 2.0. 2021 is a very different year than 2020, with production higher by 56% to approximately 108,000 BOE per day from the 68,662 BOE per day referenced earlier. We had a very active Q1 program, closing the NAL transaction on January the 4th, closing the TORC transaction on February the 24th, drilling 53 successful wells, onboarding of employees from the two acquisitions in both the office and field, and an integration of IT systems, processes, and personnel while completing our year-end operational and financial results, all prior to the end of the first quarter. Really quite a remarkable what our team has been able to accomplish in that period of time.
We followed up that with one additional announcement on April the 5th with the acquisition of Kicking Horse Oil & Gas, a private company with primary focus in the liquids-rich Montney Play in Northwest Alberta. We are excited to expand our production footprint and drilling growth inventory with this acquisition that is expected to close on approximately May the 14th. Included with this transaction, we added a sizable and strategic energy shareholder and partner in Quantum Energy Partners. This brings us to the setup for what we expect to be a very successful year. As part of our growth, we have experienced substantial changes in our organizational structure.
We moved from five business units to four, added a new energy team focused on low-carbon solutions, including carbon capture, utilization, and storage, hydrogen, lithium, with the purpose of the team to take advantage of our carbon capture expertise and to create a new energy revenue source for Whitecap into the future. We are very keen on having this team advance their projects as quickly as they have.
Stay tuned for more on this later in 2021. We expect commodity prices to continue to be volatile, however, trending positively upward. At this time, we are projecting crude oil WTI to average $60 WTI and natural gas prices to average approximately CAD 2.50 per GJ and higher for the fall and winter time periods. We expect to produce approximately 108,000 BOE per day for the year, with an increase in 2020 to approximately 120,000 BOE per day.
With commodity prices as referenced, we expect to generate a substantial amount of free cash flow after capital and dividends. The free cash flow could be we expect to be in excess of CAD 400 million. Our first priority is to continue to strengthen our balance sheet by CAD 200 million and further consider the best options for the remaining CAD 200 plus million as we advance through the remainder of the year.
Our core business will remain as a growth and dividend fossil fuel company with supplemental opportunities coming from the new energy initiative that is firing up. Areas of concern for us to be cognizant of, protect against, and work with: number one, government policies at the federal and provincial levels. Number two, downstream market interruptions, whether it be on Line 5, Line 3 replacement, DAPL, or delays on TMX. Demand recovery that seems to be well on its way.
Always something to monitor is the OPEC+ Russia behavior patterns. Our expanded team is energized, motivated, and ready to go, mainly due to the exceptional integration work of our IT team, data analysis and processes implemented by our accounting team, and a well-planned operational strategy from our engineering, operations, geoscience, and land teams, and the overall coordination support provided by our corporate administration team. I want to thank, to once again commend our expanded Whitecap team for how quickly and effectively we've been able to integrate the two substantial corporate acquisitions while undertaking an active capital program. Before closing, I would like to make a special thank you to three individuals at Whitecap who have decided to step back from our company in the next couple of months to enjoy a more relaxing lifestyle going forward.
Stan Wright, retiring to the sun after more than 40 years in the energy sector. Stan has been with us, working diligently for the last four-year period of time after joining us from Cenovus. Karen Wolsick is stepping back to enjoy her family after a seven-and-a-half-year period of time with us, but I have a sneaking suspicion we may see her back here someday. Jolie Widmer, stepping back to enjoy her family after 21-year stint in the companies that I have been responsible for. You will each be missed and are always welcome back. To close off, I want to make a comment that over the past 11 years, beginning in September of 2009, our Whitecap team has been able to deliver a sustainable business model through varying commodity cycles.
And yes, I recognize that this new and unprecedented challenging time that we're moving through. I can say that I have absolute full confidence in our team of driven and dedicated employees both in the office and in the field with the assets we have under management, the processes we use on a daily basis, and the opportunities that we have. We will continue to provide long-term value, adding growth and superior returns to our shareholders into the future. On behalf of all of us at Whitecap, thank you for your time today, your interest in our Whitecap story, and your support of our company. Stay healthy, stay strong, stay positive. Thank you.
That concludes today's webcast. Thank you.