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. As of May 6, 2021, Crew currently has over 55% of forecast 2021 natural gas production hedged at an average price of $3.08 per mcf

Hedging Summary as of May 6, 2021

NOTIONAL QUANTITY TERM STRIKE PRICE OPTION TRADED
Natural Gas - AECO Daily Index:    
2,500 gj/day Apr 1, 2021 - Oct 31, 2021 $2.35/gj Swap
21,500 gj/day Apr 1, 2021 - Jun 30, 2021 $2.16/gj Swap
7,500 gj/day Apr 1, 2021 - Dec 31, 2021 $2.59/gj Swap
19,000 gj/day Jul 1, 2021 - Sep 30, 2021 $2.23/gj Swap
17,500 gj/day Oct 1, 2021 - Dec 31, 2021 $2.47/gj Swap
22,500 gj/day Nov 1, 2021 - Dec 31, 2021 $2.72/gj Swap
15,000 gj/day Nov 1, 2021 - Mar 31, 2022 $2.72/gj Swap
20,000 gj/day Jan 1, 2022 - Mar 31, 2022 $3.05/gj Swap
15,000 gj/day Jan 1, 2022 - Dec 31, 2022 $2.42/gj Swap
20,000 gj/day Apr 1, 2022 - Jun 30, 2022 $2.17/gj Swap
5,000 gj/day Apr 1, 2022 - Oct 31, 2022 $2.19/gj Swap
20,000 gj/day Jul 1, 2022 - Sep 30, 2022 $2.20/gj Swap
20,000 gj/day Oct 1, 2022 - Dec 31, 2022 $2.44/gj Swap

Natural Gas - AECO Monthly Index:

   
2,500 gj/day Apr 1, 2021 - Oct 31, 2021 $2.05/gj Swap
6,000 gj/day Apr 1, 2021 - Jun 30, 2021 $2.12/gj Swap
2,500 gj/day Apr 1, 2021 - Dec 31, 2021 $2.45/gj Swap
12,500 gj/day Apr 1, 2021 - Dec 31, 2021 $2.50 - $2.85/gj Collar(1)
10,000 gj/day Jul 1, 2021 - Sep 30, 2021 $2.19/gj Swap
9,000 gj/day Oct 1, 2021 - Dec 31, 2021 $2.40/gj Swap
5,000 gj/day Nov 1, 2021 - Mar 31, 2022 $2.84/gj Swap
5,000 gj/day Nov 1, 2021 - Mar 31, 2022 $2.65-$2.95/gj Collar(2)
10,000 gj/day Jan 1, 2022 - Mar 31, 2022 $3.09/gj Swap
2,500 gj/day Jan 1, 2022 - Mar 31, 2022 $2.75-$3.20/gj Collar(3)
7,500 gj/day Jan 1, 2022 - Dec 31, 2022 $2.36/gj Swap
10,000 gj/day Apr 1, 2022 - Jun 30, 2022 $2.20/gj Swap
10,000 gj/day Jul 1, 2022 - Sep 30, 2022 $2.22/gj Swap
10,000 gj/day Oct 1, 2022 - Dec 31, 2022 $2.48/gj Swap
Natural Gas - CDN$ Chicago Citygate Daily:    
17,500 mmbtu/day Apr 1, 2021 - Oct 31, 2021 $3.49/mmbtu Swap
Natural Gas - CDN$ Chicago Citygate Monthly:  

 

7,500 mmbtu/day Apr 1, 2021 - Oct 31, 2021 $3.49/mmbtu

Swap

Crude Oil - CDN$ WTI:  

 

250 bbl/day Apr 1, 2021 - Jun 30, 2021 $59.00/bbl

Swap

Crude Oil - CDN$ WCS:  

 

500 bbl/day Apr 1, 2021 - Jun 30, 2021 $43.03/bbl

Swap

250 bbl/day Apr 1, 2021 - Dec 31, 2021 $44.00/bbl Swap
250 bbl/day Jul 1, 2021 - Dec 31, 2021 $47.75/bbl Swap
250 bbl/day Oct 1, 2021 - Dec 31, 2021 $57.20/bbl Swap
250 bbl/day Jan 1, 2022 - Mar 31, 2022 $56.30/bbl Swap
CDN$ Edmonton C5 Blended Index:    
2,000 bbl/day Apr 1, 2021 - Jun 30, 2021 $62.40/bbl Swap
250 bbl/day Apr 1, 2021 - Dec 31, 2021 $60.85/bbl Swap
1,250 bbl/day Jul 1, 2021 - Dec 30, 2021 $61.32/bbl Swap
250 bbl/day Jan 1, 2022 - Jun 30, 2022 $68.25/bbl Swap

(1) The referenced contract is a costless collar whereby the Corporation receives $2.50/gj when the market price is below $2.50/gj, and receives $2.85/gj when the market price is above $2.85/gj.

(2) The referenced contract is a costless collar whereby the Corporation receives $2.65/gj when the market price is below $2.65/gj, and receives $2.95/gj when the market price is above $2.95/gj.

(3) The referenced contract is a costless collar whereby the Corporation receives $2.75/gj when the market price is below $2.75/gj, and receives $3.20/gj when the market price is above $3.20/gj.