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Oil and Gas Properties
 12 Months Ended
Dec. 31, 2021
Property, plant and equipment [abstract]  
Oil and gas properties OIL AND GAS PROPERTIES
CostAccumulated
 depletion		Net book value
Balance, December 31, 2019$11,128,297 $(5,740,408)$5,387,889 
Capital expenditures275,850 — 275,850 
Transfers from exploration and evaluation assets (note 5)8,585 — 8,585 
Change in asset retirement obligations (note 9)94,994 — 94,994 
Property swaps(1,190)178 (1,012)
Impairment— (2,247,162)(2,247,162)
Foreign currency translation(82,860)120,123 37,263 
Depletion— (478,859)(478,859)
Balance, December 31, 2020$11,423,676 $(8,346,128)$3,077,548 
Capital expenditures310,005 — 310,005 
Property acquisitions274 — 274 
Divestitures(37,835)32,844 (4,991)
Property swaps(26,131)25,900 (231)
Transfers from exploration and evaluation assets (note 5)7,727 — 7,727 
Change in asset retirement obligations (note 9)(12,222)— (12,222)
Impairment reversal— 1,542,414 1,542,414 
Foreign currency translation(31,977)34,765 2,788 
Depletion— (458,941)(458,941)
Balance, December 31, 2021$11,633,517 $(7,169,146)$4,464,371 

Baytex recorded total impairment reversals related to oil and gas properties of $1.5 billion for the year ended December 31, 2021 and impairment losses related to oil and gas properties of $2.2 billion for the year ended December 31, 2020.

2021 Impairment Reversals

At December 31, 2021, we identified indicators of impairment reversal for oil and gas properties in five CGUs due to the increase in forecasted commodity prices in addition to changes in proved plus probable reserves. The recoverable amount for three CGUs exceeded their carrying amounts which resulted in an impairment reversal of $416 million recorded at December 31, 2021. The recoverable amount for each CGU was based on its FVLCD which was estimated using a discounted cash flow model of proved plus probable cash flows from an independent reserve report prepared as at December 31, 2021. The after-tax discount rates applied to the cash flows were between 12% and 19%.

At December 31, 2021, the recoverable amount of the five CGUs tested were calculated using the following benchmark reference prices for the years 2022 to 2031 adjusted for commodity differentials specific to the CGU. The prices and costs subsequent to 2031 have been adjusted for inflation at an annual rate of 2.0%.
2022202320242025202620272028202920302031
WTI crude oil (US$/bbl)72.83 68.78 66.76 68.09 69.45 70.84 72.26 73.70 75.18 76.68 
WCS heavy oil ($/bbl)74.42 69.17 66.54 67.87 69.23 70.61 72.02 73.46 74.69 76.19 
LLS crude oil (US$/bbl)74.33 70.28 68.27 69.62 71.01 72.41 73.85 75.32 76.82 78.35 
Edmonton par oil ($/bbl)86.82 80.73 78.01 79.57 81.16 82.78 84.44 86.13 87.85 89.61 
Henry Hub gas (US$/mmbtu)3.85 3.44 3.17 3.24 3.30 3.37 3.44 3.50 3.58 3.65 
AECO gas ($/mmbtu)3.56 3.21 3.05 3.11 3.17 3.23 3.30 3.36 3.43 3.50 
Exchange rate (CAD/USD)1.26 1.26 1.26 1.26 1.26 1.26 1.26 1.26 1.26 1.26 
The following table summarizes the recoverable amount and impairment reversal at December 31, 2021 and demonstrates the sensitivity of the estimated recoverable amount of the five CGUs with respect to reasonably possible changes in key assumptions inherent in the estimate.
Recoverable amountImpairment
 reversal
Change in discount rate of 1%
Change in oil price of $2.50/bbl
Change in gas price of $0.25/mcf
Conventional CGU$77,846 $19,000 $— $3,000 $8,000 
Peace River CGU489,274 251,000 8,500 53,000 3,500 
Lloydminster CGU479,411 146,000 12,500 52,000 — 
Viking CGU1,320,094 — 38,000 85,500 4,500 
Eagle Ford CGU2,008,478 — 97,200 138,800 31,300 
$4,375,103 $416,000 $156,200 $332,300 $47,300 

At June 30, 2021, we identified indicators of impairment reversal for oil and gas properties in each of our six CGUs due to the increase in forecasted commodity prices. The recoverable amount for each of our six CGUs exceeded their carrying amounts which resulted in an impairment reversal of $1.1 billion recorded at June 30, 2021. The recoverable amount for each CGU was based on its FVLCD which was estimated using a discounted cash flow model of proved plus probable cash flows from an independent reserve report prepared as at December 31, 2020 and was adjusted by management for operations between December 31, 2020 and June 30, 2021. The after-tax discount rates applied to the cash flows were between 10% and 16%.

At June 30, 2021, the recoverable amount of the Company's CGUs were calculated using the following benchmark reference prices for the years 2021 to 2030 adjusted for commodity differentials specific to the Company. The prices and costs subsequent to 2030 have been adjusted for inflation at an annual rate of 2.0%.
2021202220232024202520262027202820292030
WTI crude oil (US$/bbl)71.33 67.20 63.95 63.23 64.50 65.79 67.10 68.44 69.81 71.21 
WCS heavy oil ($/bbl)72.22 66.84 61.73 60.70 61.91 63.15 64.42 65.70 67.02 68.36 
LLS crude oil (US$/bbl)72.17 68.53 65.80 65.10 66.39 67.71 69.05 70.42 71.82 73.26 
Edmonton par oil ($/bbl)83.20 78.27 74.06 73.05 74.51 76.00 77.52 79.07 80.66 82.27 
Henry Hub gas (US$/mmbtu)3.42 3.19 2.92 2.96 3.02 3.08 3.14 3.21 3.27 3.34 
AECO gas ($/mmbtu)3.46 3.13 2.72 2.71 2.76 2.82 2.88 2.94 2.99 3.05 
Exchange rate (CAD/USD)1.24 1.25 1.25 1.25 1.25 1.25 1.25 1.25 1.25 1.25 

The following table summarizes the recoverable amount and impairment reversal at June 30, 2021 and demonstrates the sensitivity of the estimated recoverable amount of the Company's CGUs comprising oil and gas properties to reasonably possible changes in key assumptions inherent in the estimate.
Recoverable amountImpairment
 reversal
Change in discount rate of 1%
Change in oil price of $2.50/bbl
Change in gas price of $0.25/mcf
Conventional CGU$57,891 $15,000 $1,000 $1,000 $8,000 
Peace River CGU238,714 154,000 4,000 40,000 2,500 
Lloydminster CGU340,730 154,000 12,500 52,000 — 
Duvernay CGU(1)
115,157 5,000 45,000 44,500 44,500 
Viking CGU1,338,985 356,000 47,000 89,500 4,500 
Eagle Ford CGU2,015,118 442,415 109,400 103,900 24,400 
$4,106,595 $1,126,415 $218,900 $330,900 $83,900 
(1)     The impairment reversal for the Duvernay CGU was limited to total accumulated impairments less subsequent depletion of $5.0 million.
2020 Impairments

At December 31, 2020, the Company estimated the recoverable amount of each of its six CGUs due to the volatility in commodity prices during the year and a reduction in future development costs per well for the Viking and Eagle Ford CGUs. The recoverable amount supported the carrying amount for the Conventional, Peace River, Lloydminster, and Duvernay CGUs and no impairment or impairment reversal was recorded. The recoverable amount for the Viking and Eagle Ford CGUs exceeded their carrying amounts which resulted in an impairment reversal of $341.3 million recorded at December 31, 2020. The recoverable amount for each CGU was based on its FVLCD which was estimated using a discounted cash flow model of proved plus probable cash flows from an independent reserve report prepared as at December 31, 2020. The after-tax discount rates applied to the cash flows were between 10% and 17%.

At December 31, 2020, the recoverable amount of the Company's CGUs were calculated using the following benchmark reference prices for the years 2021 to 2030 adjusted for commodity differentials specific to the Company. The prices and costs subsequent to 2030 have been adjusted for inflation at an annual rate of 2%.
2021202220232024202520262027202820292030
WTI crude oil (US$/bbl)47.17 50.17 53.17 54.97 56.07 57.19 58.34 59.50 60.69 61.91 
WCS heavy oil ($/bbl)44.63 48.18 52.10 54.10 55.19 56.29 57.42 58.57 59.74 60.93 
LLS crude oil (US$/bbl)49.50 52.85 55.87 57.69 58.82 59.97 61.15 62.34 63.56 64.83 
Edmonton par oil ($/bbl)55.76 59.89 63.48 65.76 67.13 68.53 69.95 71.40 72.88 74.34 
Henry Hub gas (US$/mmbtu)2.83 2.87 2.90 2.96 3.02 3.08 3.14 3.20 3.26 3.33 
AECO gas ($/mmbtu)2.78 2.70 2.61 2.65 2.70 2.76 2.81 2.87 2.92 2.98 
Exchange rate (CAD/USD)1.30 1.31 1.31 1.31 1.31 1.31 1.31 1.31 1.31 1.31 

The following table demonstrates the sensitivity of the estimated recoverable amount of the Company's CGUs to reasonably possible changes in key assumptions inherent in the estimate.
Recoverable amountImpairment
reversal
Change in discount rate of 1%
Change in oil price of $2.50/bbl
Change in gas price of $0.25/mcf
Conventional CGU$54,265 $— $1,000 $3,000 $9,000 
Peace River CGU104,225 — 1,000 49,500 3,000 
Lloydminster CGU212,979 — 7,000 57,500 500 
Duvernay CGU70,491 — 5,500 12,000 1,500 
Viking CGU1,026,026 116,000 34,500 106,500 5,000 
Eagle Ford CGU1,609,562 225,326 91,600 157,500 38,400 
$3,077,548 $341,326 $140,600 $386,000 $57,400 
At March 31, 2020, the Company identified indicators of impairment for each of its six CGUs due to a significant decline in forecasted commodity prices. The recoverable amount was not sufficient to support the carrying amount which resulted in an impairment of $2.6 billion recorded at March 31, 2020. The recoverable amount of each CGU was based on its FVLCD which was estimated using a discounted cash flow model of proved plus probable cash flows from an independent reserve report prepared as at December 31, 2019 and was adjusted for operations between December 31, 2019 and March 31, 2020. The after-tax discount rates applied to the cash flows were between 8% and 14%.

At March 31, 2020, the recoverable amount of the Company's CGUs were calculated using the following benchmark reference prices for the years 2020 to 2029 adjusted for commodity differentials specific to the Company. The prices and costs subsequent to 2029 have been adjusted for inflation at an annual rate of 2%.
2020202120222023202420252026202720282029
WTI crude oil (US$/bbl)29.17 40.45 49.17 53.28 55.66 56.87 58.01 59.17 60.35 61.56 
WCS heavy oil ($/bbl)19.21 34.65 46.34 51.25 54.28 55.72 56.96 58.22 59.51 60.82 
LLS crude oil (US$/bbl)32.17 43.80 52.55 56.68 59.10 60.35 61.52 62.72 63.94 65.19 
Edmonton par oil ($/bbl)29.22 46.85 59.27 65.02 68.43 69.81 71.24 72.70 74.19 75.71 
Henry Hub gas (US$/mmbtu)2.10 2.58 2.79 2.86 2.93 3.00 3.07 3.13 3.19 3.25 
AECO gas ($/mmbtu)1.74 2.20 2.38 2.45 2.53 2.60 2.66 2.72 2.79 2.85 
Exchange rate (CAD/USD)1.41 1.37 1.34 1.34 1.34 1.33 1.33 1.33 1.33 1.33 
The following table demonstrates the sensitivity of the estimated recoverable amount of the Company's CGUs to reasonably possible changes in key assumptions inherent in the estimate.
Recoverable amountImpairment
Change in discount rate of 1%
Change in oil price of $2.50/bbl
Change in gas price of $0.25/mcf
Conventional CGU$37,444 $41,000 $3,000 $3,500 $8,500 
Peace River CGU109,631 345,000 9,500 53,500 3,000 
Lloydminster CGU227,967 470,000 25,000 69,500 — 
Duvernay CGU61,197 5,000 5,500 9,500 1,500 
Viking CGU962,134 915,000 57,000 123,000 4,000 
Eagle Ford CGU1,576,423 812,488 120,750 141,500 32,000 
$2,974,796 $2,588,488 $220,750 $400,500 $49,000