Hedging and Marketing

Pengrowth’s marketing program optimizes netbacks by accessing major North American consuming areas and marketing hubs.  It enhances Pengrowth’s risk management by reducing exposure to individual markets and intermediaries.

Pengrowth’s marketing strategy is to control the destination markets of its production by acting as its own shipper.  Having control over where our production is shipped and to which consumers or intermediaries enables Pengrowth’s marketing team to monitor and take advantage of favourable pricing opportunities in various North American markets. 

Pengrowth’s marketing team and field teams work closely together to match timely sales with optimized production volumes. This reduces the need for and cost of inventory activity. We also market production on behalf of third-party producers to both parties’ mutual benefit.

As part of our financial management strategy, Pengrowth uses forward price swap and option contracts to manage its exposure to commodity price fluctuations and to provide a measure of stability to monthly cash distributions. Pengrowth has also historically employed commodity risk management strategies to partially secure the economic return on acquisitions and we anticipate doing so into the future.

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