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by Stockwatch Business Reporter

West Texas Intermediate crude for April delivery added $1.59 to $49.76 on the New York Merc, while Brent for April added $2.53 to $62.58 (all figures in this para U.S.). Western Canadian Select traded at a discount of $14.10 to WTI ($35.66), unchanged. Natural gas for April added 3.7 cents to $2.73. The TSX energy index lost 1.31 points to close at 221.79.

Derek Evans's Pengrowth Energy Corp. (PGF) added 14 cents to $4.14 on 3.08 million shares, as news of a good operational fourth quarter was slightly spoiled by a towering financial loss. Adjusted net loss was $854.8-million, compared with just $37.3-million a year earlier. This was mainly because of a non-cash impairment charge of about $858-million on mature assets, caused by falling commodity prices. (Falling prices also forced Pengrowth to lower its 2015 budget and halve its dividend last month. The new two-cent monthly payout yields 5.8 per cent.) Much of the impairment amount may be written back up if prices recover. As for operations, production for the year came to 73,288 barrels a day, just above guidance of 71,000 to 73,000 barrels a day. Pengrowth patted itself on the back for surpassing its production goal, as well as achieving its important goal of starting the first phase of its Lindbergh thermal project on time in December. Lindbergh produced 1,800 barrels a day from Feb. 21 through 25 and is expected to end the year at 16,000 barrels a day. By early 2020, Pengrowth expects 45,000 barrels a day from Lindbergh, after the second and final phase starts in late 2017. It was originally expected to start earlier but was delayed because of current prices. During a conference call this morning, president and CEO Evans was asked at what price he would consider removing the delay. Mr. Evans said that although phase 1 is profitable at $50 (U.S.) WTI, he would not seriously think about starting phase 2 until WTI hits $65 (U.S.) to $70 (U.S.), and even then he would have to look at price volatility and hedging options. This year, Pengrowth has hedged three-quarters of its oil and about half of its gas, to protect cash flow while it gets Lindbergh off to a good start. The company expects that its overall inflow and outflow will be balanced this year. Any extra inflow will help pay down debt, which is $1.8-billion, compared with market cap of $2.2-billion.

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