CALGARY, AB, May 2, 2024 /CNW/ - Paramount Resources Ltd. ("Paramount" or the "Company") (TSX:POU) is pleased to announce its first quarter 2024 financial and operating results, highlighted by strong contributions from its Duvernay developments at Kaybob North and Willesden Green. The Company is also pleased to announce that it is increasing its regular monthly dividend by 20% from $0.125 per class A common share ("Common Share") to $0.15 per Common Share beginning May 2024. HIGHLIGHTS First quarter sales volumes averaged 100,977 Boe/d (47% liquids). (1) Grande Prairie Region sales volumes averaged 67,163 Boe/d (50% liquids). As previously disclosed, first quarter production was impacted by cold weather, intermittent run time at key facilities and other operational challenges. Production has since been largely restored and the Company has begun to realize benefits from the aggressive well optimization program it initiated in March 2024. Kaybob Region sales volumes increased to 22,353 Boe/d (42% liquids), driven by a new six well Duvernay pad brought onstream at Kaybob North in the first quarter that more than offset the impact of the previously disclosed non-core asset disposition (the "2024 Kaybob Disposition"). Central Alberta and Other Region sales volumes increased to 11,461 Boe/d (44% liquids) as a result of production from four Duvernay wells brought onstream in late-2023 and January 2024. Combined, the Company's Duvernay sales volumes in the Kaybob Region and at Willesden Green increased to over 12,000 Boe/d in the first quarter, more than double fourth quarter 2023 Duvernay sales volumes. This production is approximately 70% liquids and is processed through Company owned facilities, resulting in the highest per Boe netback corporately. Cash from operating activities was $201 million ($1.39 per basic share) in the first quarter. Adjusted funds flow was $226 million ($1.56 per basic share). Free cash flow was ($10) million (($0.07) per basic share). (2) __________________________ (1) In this press release, "natural gas" refers to shale gas and conventional natural gas combined, "condensate and oil" refers to condensate, light and medium crude oil, tight oil and heavy crude oil combined, "Other NGLs" refers to ethane, propane and butane and "liquids" refers to condensate and oil and Other NGLs combined.  See the "Product Type Information" section for a complete breakdown of sales volumes for applicable periods by the specific product types of shale gas, conventional natural gas, NGLs, light and medium crude oil, tight oil and heavy crude oil.  See also "Oil and Gas Measures and Definitions" in the Advisories section. (2) Adjusted funds flow and free cash flow are capital management measures used by Paramount.  Cash from operating activities per basic share, adjusted funds flow per basic share and free cash flow per basic share are supplementary financial measures.  Refer to the "Specified Financial Measures" section for more information on these measures. First quarter capital expenditures totaled $214 million. Significant activities included: Grande Prairie Region (Montney) – nine (9.0 net) wells drilled, four (4.0 net) wells brought on production and ongoing construction of a new compressor node; Kaybob Region (Duvernay) – four (4.0 net) wells drilled and six (6.0 net) wells brought on production; and Central Alberta and Other Region (Duvernay) – two (2.0 net) wells drilled, two (2.0 net) wells brought on production and commenced construction of the Company's second natural gas processing plant at Willesden Green. Asset retirement obligations settled in the first quarter totaled $17 million, on track with budget. Activities in the quarter included the abandonment of 26 wells and the reclamation of 17 sites. Paramount closed the 2024 Kaybob Disposition in February 2024 for cash proceeds of $46 million while retaining a 2% no-deduction gross overriding royalty on the undeveloped Montney acreage forming part of the assets. At March 31, 2024, net debt was $68 million and Paramount's $1.0 billion revolving credit facility was undrawn. (1) The carrying value of the Company's investments in securities at March 31, 2024 was $569 million. In April 2024, Paramount sold 6 million common shares of NuVista Energy Ltd. for cash proceeds of $75 million. In April 2024, Paramount hedged 14,250 Bbl/d of liquids sales volumes for the remainder of 2024 at an average WTI price of CAD$111.67/Bbl, re-establishing a hedging position similar to that monetized for approximately $45 million in the fourth quarter of 2023. INCREASED DIVIDEND Paramount's Board of Directors has approved a 20% increase in the regular monthly dividend from $0.125 to $0.15 per Common Share.  The Company continues to prioritize the delivery of shareholder returns through a combination of dividends and organic growth while maintaining a strong balance sheet.  This is the fifth increase in the regular monthly dividend since it was implemented in July 2021. The first increased dividend of $0.15 per Common Share will be payable on May 31, 2024 to shareholders of record on May 15, 2024.  The dividend will be designated as an "eligible dividend" for Canadian income tax purposes. _______________________________ (1) Net (cash) debt is a capital management measure used by Paramount.  This capital management measure has been expressed as net debt in this instance for simplicity as the amount referenced is a positive number.  Refer to the "Specified Financial Measures" section for more information on this measure. GUIDANCE Paramount is reaffirming its 2024 sales volumes, capital expenditure and abandonment and reclamation expenditure guidance.  The Company is updating its forecast of 2024 free cash flow from $235 million to $205 million to reflect first quarter results.  Pricing assumptions for the final three quarters of 2024 remain unchanged at US$80.00/Bbl WTI, US$3.50/MMBtu NYMEX and $2.84/GJ AECO.  2024 Guidance Annual average sales volumes (Boe/d) 100,000 to 106,000 (47% liquids)    First half 2024 (Boe/d) 96,000 to 100,000 (47% liquids)    Second half 2024 (Boe/d) 104,000 to 112,000 (47% liquids) Capital expenditures $830 to $890 million    Sustaining and Maintenance $415 to $445 million    Growth $415 to $445 million Abandonment and reclamation expenditures $40 million Free cash flow (1) $205 million The Company's midpoint 2024 capital program, abandonment and reclamation expenditures and increased regular monthly dividend is more than fully funded under the above forecast, when combined with cash proceeds from dispositions realized year-to-date. The Company's midpoint 2024 sustaining and maintenance capital program, abandonment and reclamation expenditures and increased regular monthly dividend would remain fully funded down to an average WTI price for the remaining three quarters of 2024 of about US$45/Bbl, assuming no changes to the other forecast assumptions. See "Advisories – Pricing Sensitivity" for additional sensitivities of 2024 free cash flow to changes in commodity price assumptions. ____________________________ (1) Free cash flow is a capital management measure used by Paramount.  Refer to the " Specified Financial Measures" section for more information on this measure. The stated free cash flow forecast is based on the following assumptions for 2024: (i) the midpoint of stated capital expenditures and sales volumes, (ii) $40 million in abandonment and reclamation costs, (iii) $10 million in geological and geophysical expenses, (iv) realized pricing of $55.85/Boe; (v) a $US/$CAD exchange rate of $0.737, (vi) royalties of $8.10/Boe, (vii) operating costs of $13.30/Boe and (vii) transportation and NGLs processing costs of $3.65/Boe.  Assumed pricing of US$80.00/Bbl WTI, US$3.50/MMBtu NYMEX and $2.84/GJ AECO and an assumed $US/$CAD exchange rate of $0.735 for the remaining three quarters of 2024 is unchanged from previous guidance, but the stated amounts have been adjusted to incorporate actual results for the first quarter of 2024. REVIEW OF OPERATIONS Grande Prairie Region Sales volumes and netbacks in the Grande Prairie Region are summarized below: Q1 2024 Q4 2023 % Change Sales Volumes     Natural gas (MMcf/d) 201.8 214.4 (6)     Condensate and oil (Bbl/d) 29,202 32,382 (10)     Other NGLs (Bbl/d) 4,334 4,742 (9)    Total (Boe/d) 67,163 72,860 (8)    % liquids 50 % 51 % Netback (1) ($ millions) ($/Boe) ($ millions) ($/Boe) Change in $ millions (%)     Natural gas revenue (2) 53.0 2.89 56.2 2.85 (6)     Condensate and oil revenue 248.0 93.32 295.0 99.00 (16)     Other NGLs revenue 15.7 39.70 16.1 36.95 (2)     Royalty income and other revenue – – 0.1 – NM   Petroleum and natural gas sales 316.7 51.81 367.4 54.81 (14)   Royalties (50.8) (8.32) (56.8) (8.47) (11)   Operating expense (80.1) (13.11) (84.1) (12.54) (5)   Transportation and NGLs processing (22.6) (3.69) (26.0) (3.88) (13) 163.2 26.69 200.5 29.92 (19) (1) "Netback" is a Non-GAAP financial measure.  When presented on a $/Boe or $/Mcf basis, each of the components of Netback is a supplementary financial measure and Netback is a non-GAAP ratio.  Refer to the "Specified Financial Measures" section for more information on these measures. (2) Per unit natural gas revenue presented as $/Mcf. NM means not meaningful Sales volumes in the Grande Prairie Region averaged 67,163 Boe/d (50% liquids) in the first quarter of 2024 compared to 72,860 Boe/d (51% liquids) in the fourth quarter of 2023.  As previously disclosed, first quarter production was impacted by cold weather, intermittent run time at key facilities and other operational challenges that significantly affected production from a number of wells, including the five well Karr 07-33S pad.  New well production that came onstream in early March partly offset these impacts. Paramount commenced an aggressive well optimization program in the Grande Prairie Region in March 2024 to increase production from shut-in wells and wells that would benefit from intervention.  This has included, among other well interventions, workover operations on the Karr 07-33S pad that have yielded positive initial results. Average gross 30-day peak production per well from the eight (8.0 net) well Montney pad at Wapiti that came onstream in November 2023 was 1,164 Boe/d (2.7 MMcf/d of shale gas and 708 Bbl/d of NGLs) with an average CGR of 259 Bbl/MMcf. (1)  These results are lower than expected primarily due to challenging operating circumstances, including downhole equipment failures and high gathering system pressures, that the Company is addressing. ____________________________ (1) 30-day peak production is the highest daily average production rate for each well, measured at the wellhead, over a rolling 30-day period, excluding days when the well did not produce.  The production rates and volumes stated are over a short period of time and, therefore, are not necessarily indicative of average daily production, long-term performance or of ultimate recovery from the wells.  CGR means condensate to gas ratio and is calculated by dividing raw wellhead liquids volumes by raw wellhead natural gas volumes.  See "Oil and Gas Measures and Definitions" in the Advisories section.  Natural gas sales volumes were lower by approximately 9% and liquids sales volumes were lower by approximately 2% due to shrinkage. First quarter development activities in the Grande Prairie Region included the drilling of nine (9.0 net) Montney wells, the completion of four (4.0 net) Montney wells and the bringing onstream of four (4.0 net) Montney wells at Karr.  In addition, construction of a new compressor node in the western portion of Wapiti continues, with commissioning anticipated in the third quarter of 2024.  Initial production from the four (4.0 net) Montney wells at Karr brought on production in early March has been encouraging, with the wells averaging gross 30-day peak production per well of 1,695 Boe/d (4.8 MMcf/d of shale gas and 896 Bbl/d of NGLs) with an average CGR of 187 Bbl/MMcf. (1)(2) The Company continues to expect that its second quarter 2024 sales volumes will be impacted by a 9-day 50% curtailment at the third-party Wapiti natural gas processing plant and its third quarter 2024 sales volumes will be impacted by a 21-day full outage at that plant. Over the remaining three quarters of 2024, Paramount plans to drill a total of 27 (27.0 net) Montney wells and bring on production a total of 32 (32.0 net) Montney wells in the Grande Prairie Region. KAYBOB REGION Kaybob Region sales volumes averaged 22,353 Boe/d (42% liquids) in the first quarter of 2024 compared to 20,324 Boe/d (35% liquids) in the fourth quarter of 2023.  Sales volumes and liquids contributions were higher primarily as a result of new Duvernay well production brought onstream in the first quarter at Kaybob North that more than offset the impact of the 2024 Kaybob Disposition. In the first quarter, Paramount completed and brought onstream a six (6.0 net) Duvernay well pad and finished drilling a five (5.0 net) Duvernay well pad at Kaybob North that it had begun drilling in the fourth quarter.  The Company anticipates completing and bringing onstream all five of these wells in the second quarter. Initial production from the six (6.0 net) well pad brought on in the first quarter has exceeded expectations, averaging gross 30-day peak production per well of 1,271 Boe/d (1.8 MMcf/d of shale gas and 980 Bbl/d of NGLs) with an average CGR of 563 Bbl/MMcf. (1)(3) Over the remaining three quarters of 2024, Paramount plans to drill ten (10.0 net) Duvernay wells and bring on production eleven (11.0 net) Duvernay wells at Kaybob North. CENTRAL ALBERTA AND OTHER REGION Central Alberta and Other Region sales volumes averaged 11,461 Boe/d (44% liquids) in the first quarter of 2024 compared to 8,164 Boe/d (35% liquids) in the fourth quarter 2023.  New well production from four (4.0 net) Duvernay wells at Willesden Green that came onstream between December 2023 and January 2024 resulted in higher sales volumes and a higher liquids contribution compared to the fourth quarter of 2023. _________________________ (1) 30-day peak production is the highest daily average production rate for each well, measured at the wellhead, over a rolling 30-day period, excluding days when the well did not produce.  The production rates and volumes stated are over a short period of time and, therefore, are not necessarily indicative of average daily production, long-term performance or of ultimate recovery from the wells.  CGR means condensate to gas ratio and is calculated by dividing raw wellhead liquids volumes by raw wellhead natural gas volumes.  See "Oil and Gas Measures and Definitions" in the Advisories section. (2) Natural gas sales volumes were lower by approximately 10% and liquids sales volumes were lower by approximately 8% due to shrinkage. (3) Natural gas sales volumes were lower by approximately 16% and liquids sales volumes were lower by approximately 14% due to shrinkage. Development activities in the first quarter included the drilling of two (2.0 net) Duvernay wells at a six (6.0 net) well pad at Willesden Green.  Drilling operations on the remaining wells are anticipated to be concluded in the second quarter.  First production from three of the wells on this pad is expected in the third quarter. Construction of the Company's second natural gas processing plant at Willesden Green commenced in the first quarter with earthworks, the ordering of equipment and offsite construction of equipment modules underway.  The project is progressing as planned and Paramount continues to anticipate start-up of the plant in the fourth quarter of 2025. Over the remaining three quarters of 2024, the Company plans to drill eight (8.0 net) Duvernay wells and bring on production three (3.0 net) Duvernay wells at Willesden Green. HEDGING The Company's current commodity and foreign exchange contracts are summarized below: Q2 2024 Q3 2024 Q4 2024 Average Price (1) - Oil NYMEX WTI Swaps (Sale) (Bbl/d) (2) 14,250 14,250 14,250 CAD$111.67/Bbl MSW WTI Differential Swap (Sale) (Bbl/d) (3) 3,352 5,000 5,000 WTI less US$2.56/Bbl Natural gas AECO – Basis (Physical Sale) (MMBtu/d) 40,000 40,000 13,478 NYMEX less US$0.93/MMBtu (4) Foreign Currency Exchange Swaps (Sale) (US$MM/Month) $30 – – 1.3433 CAD$ / US$ Swaps (Sale) (US$MM/Month) – $30 $30 1.3462 CAD$ / US$ (1) Average price is calculated using a weighted average of notional volumes and prices. (2) "NYMEX" means New York Mercantile Exchange and "WTI" means West Texas Intermediate. (3) "MSW" means Mix Sweet Blend crude oil at Edmonton. (4) "NYMEX" means NYMEX pricing at Henry Hub. ANNUAL GENERAL MEETING Paramount will hold its annual general meeting of shareholders on ...