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Baytex Energy Corp. Press Release - July 28 , 2021 BAYTEX ENERGY CORP . BAYTEX ANNOUNCES SECOND QUARTER 2021 FINANCIAL AND OPERATING RESULTS , FREE CASH FLOW OF $ 112 MILLION AND REPURCHASE OF LONG - TERM NOTES CALGARY , ALBERTA ( July 28 , 2021 ) - Baytex Energy Corp. ( " Baytex " ) ( TSX : BTE ) reports its operating and financial results for the three and six months ended June 30 , 2021 ( all amounts are in Canadian dollars unless otherwise noted ) . " During the second quarter , we delivered strong operating results and substantial free cash flow . Our free cash flow profile continues to improve resulting in accelerated debt reduction . We are taking proactive measures to reduce our net debt with the repurchase and cancellation of US $ 106 million of our outstanding long - term notes due 2024 during and subsequent to the quarter . At current commodity prices , we now expect to generate over $ 350 million of free cash flow in 2021. In addition , we are drilling our fourth follow up well as we continue to advance our exciting , new , oil discovery in the Clearwater play in Peace River , " commented Ed LaFehr , President and Chief Executive Officer . Q2 2021 Highlights • • • Generated production of 81,162 boe / d ( 81 % oil and NGL ) , a 3 % increase over Q1 / 2021 . Delivered adjusted funds flow of $ 176 million ( $ 0.31 per basic share ) , a 12 % increase compared to $ 157 million ( $ 0.28 per basic share ) in Q1 / 2021 . Generated free cash flow of $ 112 million ( $ 0.20 per basic share ) . Realized an operating netback of $ 33.92 / boe , up from $ 29.80 / boe in Q1 / 2021 . Repurchased and cancelled US $ 5.8 million principal amount of 5.625 % long - term notes . Subsequent to quarter - end , repurchased and cancelled an additional US $ 100 million principal amount of 5.625 % long - term notes . Reduced net debt by $ 129 million through a combination of free cash flow and the Canadian dollar strengthening relative to the U.S. dollar . 2021 Outlook As a result of our strong operating performance through the first half of 2021 , we are increasing our production guidance to 79,000 to 80,000 boe / d , up from 77,000 to 79,000 boe / d , previously . We continue to forecast 2021 exploration and development expenditures of $ 285 to $ 315 million . Our free cash flow profile continues to improve as we benefit from our diversified oil weighted portfolio and our commitment to allocate capital effectively . At current commodity prices , we now expect to deliver over $ 350 million ( $ 0.62 per basic share ) of free cash flow this year , which will accelerate our debt reduction efforts . Five - Year Outlook Our five - year outlook ( 2021 to 2025 ) highlights our financial and operational sustainability and meaningful free cash flow generation . Through this plan period , we are committed to a disciplined and returns based capital allocation philosophy . We have updated year one of our five - year outlook ( 2021 ) to reflect year - to - date commodity prices and the forward strip for the balance of the year . The remaining years ( 2022 to 2025 ) continue to be based on a constant US $ 55 / bbl WTI price . Under the plan , we expect to generate over $ 1 billion of cumulative free cash flow as we target capital expenditures at less than 70 % of our adjusted funds flow , while optimizing production in the 80,000 to 85,000 boe / d range . Under constant US $ 60 / bbl and $ 65 / bbl WTI pricing scenarios , we expect to generate in excess of $ 1.5 billion and $ 2.0 billion of cumulative free cash flow , respectively . Based on the strong pricing environment and free cash flow forecast for 2021 , we have accelerated our debt repayment strategy by approximately one year over the base plan presented last quarter . We now anticipate hitting our net debt target of $ 1.0 to $ 1.2 billion in 2023 at US $ 55 / bbl . Throughout the plan period we will continue to monitor our leverage position and assess market conditions to determine the best methods or combination thereof to enhance shareholder returns . These could include share buy - backs , a dividend and / or reinvestment for organic growth . 1