Penn West Announces Reduction In 2015 Capital Budget, Dividend - Quick Facts

(RTTNews) - Penn West Petroleum Ltd (PWE, PWT.TO) Wednesday announced that in response to the current commodity price environment, it is reducing its capital budget by about $215 million from $840 million to $625 million. The company also reduced its 2015 dividend by approximately $160 million commencing with the 2015 first quarter dividend payment payable on April 15, 2015.

In November 2014, when Penn West announced its 2015 capital budget, the forward strip for crude oil was in the range of the Company's Canadian per barrel modeling assumption of $86.50. Since that time however, crude oil prices have declined significantly. Reflecting this reduction in the outlook for crude oil prices, the company has reduced its Canadian crude oil pricing assumption for 2015 by approximately 25 percent to $65.00 per barrel.

In order to maintain financial flexibility, the company said it reduced its capital budget. In addition, the Board has approved a reduction to Penn West's quarterly dividend commencing in the first quarter of 2015 to $0.03 per share from $0.14 per share.

Commencing with Penn West's first quarter 2015 dividend, payable on April 15, 2015, the Board has suspended Penn West's DRIP until further notice. The DRIP had permitted shareholders to apply their cash dividends to the purchase of Penn West common shares. Shareholders who had elected to participate in the DRIP will now receive cash dividends on the payment date.

The company stated that the DRIP will continue in effect for the fourth quarter 2014 dividend payment of $0.14 per share to be paid on January 15, 2015 to shareholders of record on December 31, 2014.