Hedging

As part of the Company's ongoing risk management program, Crew enters into derivative and physical hedging contracts.  Crew’s risk management program incorporates the use of puts, costless collars, swaps and fixed price contracts to limit exposure to fluctuations in commodity prices, interest rates and foreign exchange rates while allowing for participation in commodity price increases.

There are key benefits to implementing a disciplined and consistent risk management strategy:

  • Hedging can reduce volatility of funds flow from operations and underpin the capital expenditure program
  • Establishing a floor or fixed price for commodities can impart an enhanced degree of predictability in the funds flow, which contributes to greater accuracy in growth planning

The Company’s financial derivative trading activities are conducted pursuant to the Company’s Risk Management Policy approved by the Board of Directors

Hedging Summary as of Nov 3, 2016

Volume Period Derivative Reference Price
Natural Gas        
25,929 GJ/Day 2016 Swap AECO $2.55/GJ
20,000 mmbtu/Day 2016 Swap Chicago C$3.80/mmbtu
5,275 GJ/Day 2016 Physical Chicago C$3.70/GJ
5,000 GJ/Day 2017 Swaption AECO $2.90/GJ
17,500 GJ/Day 2017 Swap AECO $2.74/GJ
22,500 mmbtu/Day 2017 Swap Chicago C$3.89/mmbtu
Oil        
1,000 bopd July - Dec 2016 Swap $C WTI / bbl C$65.37
250 bopd Oct - Dec 2016 Swap $C WTI / bbl C$62.50
250 bopd Jul - Sept 2016 Swap US$WCS-WTI -$13.75
250 bopd Jan - Jun 2017 Swap $C WTI / bbl C$62.75
1,000 bopd Jan - Dec 2017 Swap $C WTI / bbl C$65.81