Annual Report - 2001 - ARC Resources Ltd.

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FINDING,DEVELOPMENT AND ACQUISITION COSTS ($/boe three-year average for established reserves) RECYCLE RATIO (Current netback/three-year average FD&A for established reserves) CASH FLOW ($ millions) 01 01 01 00 00 00 99 99 99 98 98 98 97 1.75 3.50 5.25 7.00 97 1.05 2.10 3.15 4.20 97 70 140 210 280 PRODUCTION MANAGEMENT AND COST CONTROL INCREASE IN RESERVES DEVELOPMENT ACTIVITIES The ARC business model – INCREASE IN PRODUCTION VOLUMES a strategy for success NEW ACQUISITIONS CAPITAL FOR REINVESTMENT CASH FLOW COMMODITY PRICES AND US/CDN EXCHANGE RATES EXTERNAL CAPITAL CASH DISTRIBUTIONS TO UNITHOLDERS RECLAMATION FUND UNIT MARKET PRICE ($/unit at December 31) CASH DISTRIBUTIONS ($/unit) TOTAL CAPITALIZATION ($ billions) 01 00 99 98 97 3.25 6.50 9.75 13.00 01 00 99 98 97 0.60 1.20 1.80 2.40 01 00 99 98 97 0.50 1.00 1.50 2.00
AT THE TIME OF OUR INITIAL PUBLIC OFFERING IN 1996, WE IDENTIFIED THREE CRITERIA FOR SUCCESS WHICH WE BELIEVED WOULD GENERATE SUPERIOR UNITHOLDER RETURNS. THESE CRITERIA REMAIN UNCHANGED AS WE MOVE FORWARD. OUR SUPERIOR RESULTS TO DATE CONFIRM OUR SUCCESS IN PURSUING THIS STRATEGY. MANAGEMENT EXPERTISE Excellence in management in the royalty trust sector requires a unique blend of financial acumen and oil and gas technical expertise. At ARC, we have systematically built a team of individuals who are leaders in these two areas of competency. This team has established a reputation for translating its expertise into measurable results: well-structured acquisitions have turned into value-added opportunities; innovative financial policies have allowed ARC to excel through all phases of the business cycle; and our technical competence has made a strong contribution to our return on investment. The key measurement of ARC’s management expertise is the consistent superior returns which have been delivered to unitholders. QUALITY ASSETS We have established a portfolio of high quality assets through a series of strategic acquisitions. We are disciplined about the quality and characteristics of assets that we acquire. ARC’s ability to identify quality acquisitions is enhanced by our association with ARC Financial Corporation, a leading private equity investor in the Canadian oil and gas industry. Through this relationship, we are uniquely positioned to identify and pursue acquisition opportunities. Once we acquire an asset, our work has just begun. ARC’s technical teams add value by optimizing production and increasing reserves through low risk development activities. The success of their efforts can be seen by the low cost of production and reserve additions since inception. COMMITMENT TO STAKEHOLDER INTERESTS ARC is committed to serving the best interests of all stakeholders including landowners, governments, our communities, and, of course, our unitholders. ARC believes that its decisions must be anchored in serving the interests of its stakeholders. That is the challenge – and mandate – for every employee at ARC. When it comes to our unitholders, generating superior returns is a universal commitment across the company. It drives our dedication to management expertise and our focus on acquiring and developing quality assets. Our decisions are driven by an absolute commitment to maximize distributions and long-term value to our unitholders.
Page 1 and 2: AR 2001 ARC ENERGY TRUST ANNUAL REP
Page 3 and 4: Photo: Drilling in the Drayton Vall
Page 5: OPERATING HIGHLIGHTS Years ended De
Page 9 and 10: PAGE 4 FEATURE: MANAGEMENT EXPERTIS
Page 11 and 12: John P. Dielwart Director, Presiden
Page 13 and 14: PAGE 8 MESSAGE TO UNITHOLDERS We ha
Page 15 and 16: PAGE 10 MESSAGE TO UNITHOLDERS envi
Page 17 and 18: PAGE 12 MESSAGE TO UNITHOLDERS We r
Page 19 and 20: PAGE 14 FEATURE: QUALITY ASSETS A C
Page 21 and 22: Top: Deanna Kalenchuk, Wayne Lentz,
Page 23 and 24: PAGE 18 OPERATIONS REVIEW DEVELOPME
Page 25 and 26: PAGE 20 MAJOR PROPERTIES NORTHERN A
Page 27 and 28: PAGE 22 MAJOR PROPERTIES PEMBINA PE
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PAGE 78 QUARTERLY REVIEW QUARTERLY
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PAGE 80 DIRECTORS AND OFFICERS John
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PAGE 84 CORPORATE AND UNITHOLDER IN
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ANNUAL REPORT 2001 AR 2001 ARC ENER
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Annual Report - 2001 - ARC Resources Ltd.

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