Hedging

Our hedging program continues to help reduce the volatility of our funds flow from operations, and thereby improve our ability to align capital programs going forward. We target having hedges in place for approximately 25% to 40% of our crude oil exposure, net of royalties, and 40% to 50% of our gas exposure, net of royalties up to 18-months ahead, subject to market conditions. We seek to layer on positions in a systematic fashion.

Crude Oil Hedging

As of March 31, 2017 are as follows:

Reference Price Term Price (US$/bbl Volume (bbls/d)
WTI Q2 2017 $50.70 7,800
WTI Q3 2017 $50.70 7,400
WTI Q4 2017 $50.91 7,900
WTI Q1 2018 $51.39 7,000
WTI Q2 2018 $53.30 3,000
WTI Q3 2018 $53.50 1,000

(1) The Canadian dollar hedges were converted to US dollars at the March 31, 2017 foreign exchange rate.

Natural Gas Hedging

As of March 31, 2017 are as follows:

Reference Price Term Price (US$/bbl Volume (bbls/d)
AECO Q2 2017 $2.81 19,000
AECO Q3 2017 $2.84 19,000
AECO Q4 2017 $3.00 20,900
AECO Q1 2018 $2.97 19,000
AECO Q2 2018 $2.83 13,300
AECO Q3 2018 $2.80 7,600
AECO Q3 2018 $2.84 5,700

Foreign Exchange Forwards on Senior Notes

As of March 31, 2017

  Notional Volume Remaining Term Pricing
3 to 15-year initial term US $25 2017 1.000 CAD/USD

Cross Currency Swaps

As of March 31, 2017

Notional Volume (millions) Remaining Term Pricing
£57 10-year initial term, 2018 2.0075 (CAD/GBP), 6.95%
(£28.5) 18-month offset, 2018 1.6911 (CAD/GBP), 6.95%
£20 10-year initial term, 2019 1.8051 (CAD/GBP), 9.15%
£10 10-year initial term, 2019 1.5870 (CAD/EUR), 9.22%