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Provident is a diversified energy trust with a balanced portfolio and a strategy that delivers sustainable distributions for investors. We have upstream oil and natural gas producing assets in Canada and the U.S. that are geographically diverse and balanced by commodity. We also have a major natural gas liquids infrastructure and marketing business.
Provident consists of three business units:
- Canadian upstream business unit (COGP). COGP produces and sells natural gas, crude oil, natural gas liquids and heavy oil. In keeping with our goal of creating long-term value through our diversified portfolio, COGP assets are well balanced in terms of geography and commodity mix.
- U.S. upstream business unit (USOGP). USOGP produces and sells crude oil and natural gas from mature basins in Southern California and Wyoming. USOGP's production breakdown is approximately 95 percent oil and five percent natural gas. USOGP gives Provident long-life reserves and an excellent platform for future growth.
- Midstream business unit (Midstream). Provident's Midstream business unit is Canada's second-largest integrated natural gas liquids (NGL) business. Midstream is a business with long-life physical assets (plants, pipelines, storage facilities, etc.) that provide an excellent balance to Provident's upstream production business units.
Provident's integrated portfolio strategy provides excellent sustainability and a balanced risk portfolio, both of which support our ultimate objective: long-term value.
We are confident in Provident's direction, given the sustainability we have created in building from a small Canadian-based heavy oil trust in 2001 into an interconnected continental energy business with long-life energy assets today. We calculate the economic life of our assets to exceed 17 years, which represents tremendous long-term value, particularly when compared with pure upstream trusts.
In the Midstream business unit, our focus is on capitalizing on the tremendous potential that we see in the continental NGL network that we have created. Provident has the ability to participate right through the NGL value chain, with extraction, transportation, fractionation and storage assets from Younger, British Columbia to Sarnia, Ontario, and a marketing operation that reaches into key U.S. markets.
On the USOGP side, we are pursuing the interesting strategic opportunities and growth prospects that we see in that business. Current priorities include optimizing production from existing fields and building a thermal pilot project at the Orcutt field near Santa Barbara, California.
In COGP, we are developing our grassroots, high-netback shallow gas play in Southwest Saskatchewan. We see strong opportunity in this area, and natural gas production acts as an excellent balance with our midstream business.
We see a very bright future for Provident. Our strategic direction is clear: we create long-term value and sustainability for our investors, and we achieve that sustainability through strong, long-life energy assets. By executing on our strategy, we have created three solid, largely self-sufficient business units, each with attractive size and scale in its own right. With these fundamentals now in place, we are working to demonstrate the value of this diversification.
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