We had an exciting year and look forward to sharing some of the highlights with you in our first annual online report. Feel free to flip through the pages as we’ve suggested – or simply use the navigation bar at the top of the page to jump to the section you’d like to read first. By reading about our strategy, some of last year’s notable highlights and the results we’ve generated for our investors, our hope is that you will gain additional insight into how we see The Bigger Picture.
Crescent Point continues to grow and evolve as a company, which made for an exciting 2012. Last year, in addition to generating production per share growth of 12 percent and providing our steady dividend, we completed several key acquisitions. The acquisitions ranged from smaller acquisitions in our core areas to the establishment of a new core resource play in northeast Utah, called the Uinta Basin.
Our business strategy is three-fold. First, we acquire high-quality assets with large oil-in-place pools. Next, we look to develop and exploit those assets using the most refined technology available. Because we have such large oil-in-place assets, even small improvements in the technologies we use are leveraged to create greater value for our shareholders. Last, we manage risk by implementing a disciplined 3½-year commodity hedging program. We’ve also broadened our risk management program to include shipping oil via rail, which provides us with both access to new markets and the ability to weather volatile commodity price differentials.
In 2012, we continued to stake out our territory. We grew our land base in core plays such as the Bakken and Shaunavon in Saskatchewan, as well as Beaverhill Lake in Alberta. In the fourth quarter, we acquired Ute Energy in Utah, establishing a new core area in the Uinta Basin light oil resource play. This is a new geographic area for Crescent Point but it is not unfamiliar: we believe the Uinta Basin is similar to the Bakken and Shaunavon plays in the early stages of their development – and that, like them, it has the potential to be a significant growth-driver for years to come.
With a solid and diverse portfolio, we will focus in the near-term on operational execution and on working with our teams and suppliers to integrate new assets. We will continue to develop and expand our waterflood programs, as well as focus on technological advances and their ability to increase returns. Through researching, refining and implementing industry-leading ways to complete wells across our core resource plays, such as increasing the number of stages in our cemented liner completions in southeast Saskatchewan, we constantly work to improve completions techniques. We believe this is a key factor in creating value for shareholders.
Long-term value creation has always been our goal. We believe that adhering to our consistent business strategy – acquiring and developing big oil-in-place resource plays, improving recovery factors and managing risk – will drive that value creation for many years to come. Our activities in 2012 have positioned us well for future growth and operational excellence. As we head into 2013, with a sound balance sheet and a disciplined hedging program to protect our cash flow and dividend, we are in an excellent position to deliver another year of strong results to investors.
Last year was also a significant one for Crescent Point’s community investment program. We saw the first flight of the Saskatchewan-based Shock Trauma Air Rescue Society (STARS) in April — exciting, considering we’d worked many years towards the launch of the service alongside STARS and the Saskatchewan government. We spent more than $15 million on important environmental initiatives, such as the abandonment and reclamation of existing facility locations, as well as projects related to emission reduction. We sponsored a Denver classroom for Classroom Champions, an exciting organization that enables world-class athletes to connect with classrooms using videos and live chats. As well, we renovated the Crescent Point Kidz Zone at Calgary’s Inn From the Cold, a project we look forward to every year. We are proud to have supported these – and many other – initiatives in the communities where our people live and work.
As I’ve said before, our people really are the key to Crescent Point’s success. We have an outstanding team that is dedicated to the success of our company and to that of their communities. Thank you, everyone, for your hard work in 2012. I am proud of what we’ve accomplished together and I look forward to the exciting path ahead. Crescent Point’s future is bright.
President and CEO