10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-39191

Ovintiv Inc.

(Exact name of registrant as specified in its charter)

Delaware	84-4427672
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Suite 1700, 370 17th Street, Denver, Colorado, 80202, U.S.A.

(Address of principal executive offices)

Registrant’s telephone number, including area code (303) 623-2300

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  

Yes ☐    No  ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares	OVV	New York Stock Exchange

Number of registrant’s shares of common stock outstanding as of October 29, 2021 261,084,425

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OVINTIV INC.

FORM 10-Q

TABLE OF CONTENTS

	PART I
Item 1.	Financial Statements	7
	Condensed Consolidated Statement of Earnings	7
	Condensed Consolidated Statement of Comprehensive Income	7
	Condensed Consolidated Balance Sheet	8
	Condensed Consolidated Statement of Changes in Shareholders’ Equity	9
	Condensed Consolidated Statement of Cash Flows	11
	Notes to Condensed Consolidated Financial Statements	12
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	36
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	64
Item 4.	Controls and Procedures	66
	PART II
Item 1.	Legal Proceedings	67
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67
Item 3.	Defaults Upon Senior Securities	67
Item 4.	Mine Safety Disclosures	67
Item 5.	Other Information	67
Item 6.	Exhibits	67
Signatures		69

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DEFINITIONS

Unless the context otherwise indicates, references to “us,” “we,” “our,” “ours,” “Ovintiv,” and the “Company,” refer to Ovintiv Inc. and its consolidated subsidiaries for periods after January 24, 2020 and to Encana Corporation and its consolidated subsidiaries for periods before January 24, 2020. In addition, the following are other abbreviations and definitions of certain terms used within this Quarterly Report on Form 10-Q:

“AECO” means Alberta Energy Company and is the Canadian benchmark price for natural gas.

“ASU” means Accounting Standards Update.

“bbl” or “bbls” means barrel or barrels.

“BOE” means barrels of oil equivalent.

“Btu” means British thermal units, a measure of heating value.

“DD&A” means depreciation, depletion and amortization expenses.

“ESG” means environmental, social and governance.

“FASB” means Financial Accounting Standards Board.

“GHG” means greenhouse gas.

“Mbbls/d” means thousand barrels per day.

“MBOE/d” means thousand barrels of oil equivalent per day.

“Mcf” means thousand cubic feet.

“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations.

“MMBOE” means million barrels of oil equivalent.

“MMBtu” means million Btu.

“MMcf/d” means million cubic feet per day.

“NCIB” means normal course issuer bid.

“NGL” or “NGLs” means natural gas liquids.

“NYMEX” means New York Mercantile Exchange.

“NYSE” means New York Stock Exchange.

“OPEC” means Organization of the Petroleum Exporting Countries.

“SEC” means United States Securities and Exchange Commission.

“SIB” means substantial issuer bid.

“TSX” means Toronto Stock Exchange.

“U.S.”, “United States” or “USA” means United States of America.

“U.S. GAAP” means U.S. Generally Accepted Accounting Principles.

“WTI” means West Texas Intermediate.

CONVERSIONS

In this Quarterly Report on Form 10-Q, a conversion of natural gas volumes to BOE is on the basis of six Mcf to one bbl.  BOE is based on a generic energy equivalency conversion method primarily applicable at the burner tip and does not represent economic value equivalency at the wellhead. Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value, particularly if used in isolation.

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CONVENTIONS

Unless otherwise specified, all dollar amounts are expressed in U.S. dollars, all references to “dollars”, “$” or “US$” are to U.S. dollars and all references to “C$” are to Canadian dollars. All amounts are provided on a before tax basis, unless otherwise stated. In addition, all information provided herein is presented on an after royalties basis.

The terms “include”, “includes”, “including” and “included” are to be construed as if they were immediately followed by the words “without limitation”, except where explicitly stated otherwise.

The term “liquids” is used to represent oil, NGLs and condensate. The term “liquids rich” is used to represent natural gas streams with associated liquids volumes. The term “play” is used to describe an area in which hydrocarbon accumulations or prospects of a given type occur. Ovintiv’s focus of development is on hydrocarbon accumulations known to exist over a large areal expanse and/or thick vertical section and are developed using hydraulic fracturing. This type of development typically has a lower geological and/or commercial development risk and lower average decline rate, when compared to conventional development.

The term “core asset” refers to plays that are the focus of the Company’s current capital investment and development plan. The Company continually reviews funding for development of its plays based on strategic fit, profitability and portfolio diversity and, as such, the composition of plays identified as a core asset may change over time.

References to information contained on the Company’s website at www.ovintiv.com are not incorporated by reference into, and does not constitute a part of, this Quarterly Report on Form 10-Q.

FORWARD-LOOKING STATEMENTS AND RISK

This Quarterly Report on Form 10-Q contains certain forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  All statements, except for statements of historical fact, that relate to the anticipated future activities, plans, strategies, objectives or expectations of the Company are forward-looking statements.  When used in this Quarterly Report on Form 10-Q, the use of words and phrases including “anticipates,” “believes,” “continue,” “could,” “estimates,” “expects,” “focused on,” “forecast,” “guidance,” “intends,” “maintain,” “may,” “opportunities,” “outlook,” “plans,” “potential,” “strategy,” “targets,” “will,” “would” and other similar terminology is intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words or phrases.  Forward-looking statements include statements regarding: expectations of plans, strategies and objectives of the Company, including anticipated activity and investment levels; composition of the Company’s core assets, including allocation of capital and focus of development plans; the Company’s capital allocation strategy, focus of investment, growth in long-term shareholder value, return of capital to shareholders through dividends and/or share buybacks, growth of high margin liquids volumes, operating and capital efficiencies and ability to preserve balance sheet strength; the benefits of the Company’s multi-basin portfolio, including operational flexibility and the ability to repeat and deploy successful operational learnings; the Company’s ability to maximize cash flows and the application of excess cash flows to reduce long-term debt; the ability of the Company to timely meet and maintain certain targets contained in the Company’s corporate guidance, including with respect to capital efficiency, hydrocarbon production, cash flows generation, debt reduction, GHG emissions and ESG performance, and cash returns to shareholders; anticipated cost savings, capital efficiency and sustainability thereof; anticipated oil, NGL and natural gas prices; anticipated success of, and benefits from, technology and innovation, including the cube development approach, Simul-Frac techniques and other new or advanced drilling or well completion designs; anticipated drilling activity, including the number of drilling rigs utilized and success thereof; anticipated well inventory, drilling costs and cycle times; anticipated proceeds and future benefits from various joint venture, partnership and other agreements; estimates of oil and natural gas reserves and recoverable quantities; expected production and product types; expected future interest expense; the Company’s ability to access credit facilities and other methods of funding, meet financial obligations, manage debt and financial ratios, finance growth and comply with financial covenants; the implementation and outcomes of risk management programs, including exposure to certain commodity prices and foreign exchange fluctuations, the volume of production hedged, and the markets or physical sales locations hedged; the impact of changes in laws and regulations; anticipated compliance with environmental legislation; adequacy of provisions for abandonment and site reclamation costs; the Company’s operational and financial flexibility, discipline and ability to respond to evolving market conditions; impacts to the Company as a result of a reduction of its credit rating; the declaration and payment of future dividends, if any; expectations with respect to the Company’s restructuring initiative, including anticipated transition and severance costs and the timing thereof; adequacy of the Company’s provision

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for taxes and legal claims; the Company’s ability to manage cost inflation and expected cost structures, including expected operating, transportation, processing and administrative expenses; competitiveness of the Company against its peers, including with respect to capital, materials, people, assets and production; global oil, NGL and natural gas inventories and global demand for oil, NGL and natural gas; the outlook of the oil and gas industry generally, including impacts from changes to the geopolitical environment; the Company’s commitments and contingencies and anticipated payments thereunder; and the possible impact of accounting pronouncements, rule changes and standards.

Readers are cautioned against unduly relying on forward-looking statements which, by their nature, involve numerous assumptions and are subject to both known and unknown risks and uncertainties (many of which are beyond our control) that may cause such statements not to occur, or actual results to differ materially and/or adversely from those expressed or implied. These assumptions include: future commodity prices and basis differentials; future foreign exchange rates; the ability of the Company to access credit facilities and shelf prospectuses; data contained in key modeling statistics; the availability of attractive commodity or financial hedges and the enforceability of risk management programs; the Company’s ability to capture and maintain gains in productivity and efficiency; benefits from technology and innovations; expectations that counterparties will fulfill their obligations pursuant to gathering, processing, transportation and marketing agreements; access to adequate gathering, transportation, processing and storage facilities; assumed tax, royalty and regulatory regimes; expectations and projections made in light of, and generally consistent with, the Company’s historical experience and its perception of historical industry trends, including with respect to the pace of technological development; and the other assumptions contained herein.

Risks and uncertainties that may affect the Company’s financial or operating performance include: market and commodity price volatility, including widening price or basis differentials, and the associated impact to the Company’s stock price, credit rating, financial condition, oil and natural gas reserves and access to liquidity; uncertainties, costs and risks involved in our operations, including hazards and risks incidental to both the drilling and completion of wells and the production, transportation, marketing and sale of oil, NGL and natural gas; availability of equipment, services, resources and personnel required to perform the Company’s operating activities; suspension of or changes to corporate guidance, and associated impacts to production and cash flows; our ability to generate sufficient cash flows to meet our obligations and reduce debt; the impact of COVID-19 (or other future pandemics) on commodity prices and to the Company’s operations, including maintaining adequate staffing levels, securing operational inputs, executing all or a portion of our business plan and managing cyber-security risks associated with remote work; our ability to secure adequate transportation and storage for oil, NGL and natural gas, as well as access to end markets or physical sales locations; interruptions to oil, NGL and natural gas production, including potential curtailments of gathering, transportation or refining operations; variability and discretion of the Company’s board of directors (the “Board of Directors”) to declare and pay dividends, if any; the timing and costs associated with drilling and completing wells, and the construction of well facilities and gathering and transportation pipelines; business interruption, property and casualty losses (including weather related losses) or unexpected technical difficulties and the extent to which insurance covers any such losses; risks associated with decommissioning activities, including timing and costs thereof; counterparty and credit risk; the impact of changes in our credit rating and access to liquidity, including costs thereof; changes in political or economic conditions in the U.S. and Canada, including fluctuations in foreign exchange rates, interest rates and inflation rates; failure to achieve or maintain our cost and efficiency initiatives; risks associated with technology, including electronic, cyber and physical security breaches; changes in royalty, tax, environmental, GHG, carbon, accounting and other laws or regulations or the interpretations thereof; our ability to timely obtain environmental or other necessary government permits or approvals; the Company’s ability to utilize U.S. net operating loss carryforwards and other tax attributes; risks associated with existing and potential lawsuits and regulatory actions made against the Company; risks related to the purported causes and impact of climate change, and the costs therefrom; the impact of disputes arising with our partners, including suspension of certain obligations and inability to dispose of assets or interests in certain arrangements; the Company’s ability to acquire or find additional oil and natural gas reserves; imprecision of oil and natural gas reserves estimates and estimates of recoverable quantities, including the impact to future net revenue estimates; risks associated with past and future acquisitions or divestitures of oil and natural gas assets, including the receipt of any contingent amounts contemplated in the transaction agreements (such transactions may include third-party capital investments, farm-ins, farm-outs or partnerships, which the Company may refer to from time to time as “partnerships” or “joint ventures” and the funds received in respect thereof which the Company may refer to from time to time as “proceeds”, “deferred purchase price” and/or “carry capital”, regardless of the legal form); our ability to repurchase the Company’s outstanding common shares, including risks associated with obtaining any necessary stock exchange approvals; the existence of alternative uses for the Company’s cash resources which may be superior to the payment of dividends or effecting repurchases of the Company’s outstanding common shares; risks and uncertainties described in Item 1A. Risk Factors of the Company’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the “2020 Annual Report

5

on Form 10-K”) and in this Quarterly Report on Form 10-Q; and other risks and uncertainties impacting the Company’s business as described from time to time in the Company’s other periodic filings with the SEC or Canadian securities regulators.

Readers are cautioned that the assumptions, risks and uncertainties referenced above are not exhaustive. Although the Company believes the expectations represented by its forward-looking statements are reasonable based on the information available to it as of the date such statements are made, forward-looking statements are only predictions and statements of our current beliefs and there can be no assurance that such expectations will prove to be correct.  All forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date of this document and, except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statements. The forward-looking statements contained in this Quarterly Report on Form 10-Q and all subsequent forward-looking statements attributable to the Company, whether written or oral, are expressly qualified by these cautionary statements.

The reader should read carefully the risk factors described in Item 1A. Risk Factors of the 2020 Annual Report on Form 10-K and in this Quarterly Report on Form 10-Q for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements.

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PART I

Item 1. Financial Statements

Condensed Consolidated Statement of Earnings (unaudited)

				Three Months Ended						Nine Months Ended
				September 30,						September 30,
(US$ millions, except per share amounts)				2021			2020			2021			2020
Revenues		(Note 2)
Product and service revenues		(Note 3)		$	2,720		$	1,326		$	7,440		$	3,919
Gains (losses) on risk management, net		(Note 19)			(950	)		(154	)		(2,176	)		587
Sublease revenues		(Note 9)			19			18			55			53
Total Revenues					1,789			1,190			5,319			4,559
Operating Expenses		(Note 2)
Production, mineral and other taxes					77			47			210			126
Transportation and processing					397			365			1,194			1,129
Operating	(Notes 16, 17)				153			133			466			452
Purchased product					759			322			2,096			1,039
Depreciation, depletion and amortization					297			406			916			1,433
Impairments		(Note 8)			-			1,336			-			4,863
Accretion of asset retirement obligation					5			8			17			26
Administrative	(Notes 15, 16, 17)				101			79			346			297
Total Operating Expenses					1,789			2,696			5,245			9,365
Operating Income (Loss)					-			(1,506	)		74			(4,806	)
Other (Income) Expenses
Interest		(Notes 4, 10)			77			97			263			279
Foreign exchange (gain) loss, net		(Notes 5, 19)			-			(25	)		(15	)		51
Other (gains) losses, net		(Notes 6, 10, 17)			(6	)		(18	)		(31	)		(48	)
Total Other (Income) Expenses					71			54			217			282
Net Earnings (Loss) Before Income Tax					(71	)		(1,560	)		(143	)		(5,088	)
Income tax expense (recovery)		(Note 6)			1			(39	)		(175	)		395
Net Earnings (Loss)				$	(72	)	$	(1,521	)	$	32		$	(5,483	)
Net Earnings (Loss) per Share of Common Stock		(Note 12)
Basic				$	(0.28	)	$	(5.85	)	$	0.12		$	(21.10	)
Diluted					(0.28	)		(5.85	)		0.12			(21.10	)
Weighted Average Shares of Common Stock Outstanding (millions)			(Note 12)
Basic					261.1			259.8			260.7			259.8
Diluted					261.1			259.8			265.3			259.8

Condensed Consolidated Statement of Comprehensive Income (unaudited)

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
(US$ millions)		2021			2020			2021			2020
Net Earnings (Loss)		$	(72	)	$	(1,521	)	$	32		$	(5,483	)
Other Comprehensive Income (Loss), Net of Tax
Foreign currency translation adjustment	(Note 13)		(48	)		26			(4	)		(21	)
Pension and other post-employment benefit plans	(Notes 13, 17)		(1	)		(2	)		(4	)		(1	)
Other Comprehensive Income (Loss)			(49	)		24			(8	)		(22	)
Comprehensive Income (Loss)		$	(121	)	$	(1,497	)	$	24		$	(5,505	)

See accompanying Notes to Condensed Consolidated Financial Statements

7

Condensed Consolidated Balance Sheet (unaudited)

			As at			As at
			September 30,			December 31,
(US$ millions)			2021			2020
Assets
Current Assets
Cash and cash equivalents			$	8		$	10
Accounts receivable and accrued revenues (net of allowances      of $3 million (2020: $4 million))		(Note 3)		1,221			928
Risk management		(Notes 18, 19)		1			37
Income tax receivable		(Note 6)		98			272
				1,328			1,247
Property, Plant and Equipment, at cost:		(Note 8)
Oil and natural gas properties, based on full cost accounting
Proved properties				54,684			53,883
Unproved properties				2,217			2,962
Other				897			911
Property, plant and equipment				57,798			57,756
Less: Accumulated depreciation, depletion and amortization				(49,208	)		(48,306	)
Property, plant and equipment, net		(Note 2)		8,590			9,450
Other Assets				1,094			1,143
Risk Management		(Notes 18, 19)		-			4
Goodwill		(Note 2)		2,624			2,625
		(Note 2)	$	13,636		$	14,469
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable and accrued liabilities			$	1,866		$	1,704
Current portion of operating lease liabilities				63			68
Income tax payable				4			3
Risk management		(Notes 18, 19)		1,418			130
Current portion of long-term debt		(Note 10)		-			518
				3,351			2,423
Long-Term Debt		(Note 10)		4,791			6,367
Operating Lease Liabilities				900			938
Other Liabilities and Provisions	(Note 11)			215			358
Risk Management		(Notes 18, 19)		246			125
Asset Retirement Obligation				336			401
Deferred Income Taxes				-			20
				9,839			10,632
Commitments and Contingencies		(Note 21)
Shareholders’ Equity
Share capital - authorized 775 million shares of stock
2021 issued and outstanding: 261.1 million shares (2020: 259.8 million shares)		(Note 12)		3			3
Paid in surplus		(Note 12)		8,553			8,531
Retained earnings (Accumulated deficit)				(5,827	)		(5,773	)
Accumulated other comprehensive income		(Note 13)		1,068			1,076
Total Shareholders’ Equity				3,797			3,837
			$	13,636		$	14,469

See accompanying Notes to Condensed Consolidated Financial Statements

8

Condensed Consolidated Statement of Changes in Shareholders’ Equity (unaudited)

Three Months Ended September 30, 2021 (US$ millions)		Share Capital		Paid in Surplus		Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Income			Total Shareholders’ Equity
Balance, June 30, 2021		$	3	$	8,532	$	(5,718	)	$	1,117		$	3,934
Net Earnings (Loss)			-		-		(72	)		-			(72	)
Dividends on Shares of Common Stock ($0.14 per share)	(Note 12)		-		-		(37	)		-			(37	)
Equity-Settled Compensation Costs			-		21		-			-			21
Other Comprehensive Income (Loss)	(Note 13)		-		-		-			(49	)		(49	)
Balance, September 30, 2021		$	3	$	8,553	$	(5,827	)	$	1,068		$	3,797

Three Months Ended September 30, 2020 (US$ millions)		Share Capital		Paid in Surplus		Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Income		Total Shareholders’ Equity
Balance, June 30, 2020		$	3	$	8,460	$	(3,590	)	$	1,000	$	5,873
Net Earnings (Loss)			-		-		(1,521	)		-		(1,521	)
Dividends on Shares of Common Stock ($0.09375 per share)	(Note 12)		-		-		(24	)		-		(24	)
Other Comprehensive Income (Loss)	(Note 13)		-		-		-			24		24
Balance, September 30, 2020		$	3	$	8,460	$	(5,135	)	$	1,024	$	4,352

See accompanying Notes to Condensed Consolidated Financial Statements

9

Condensed Consolidated Statement of Changes in Shareholders’ Equity (unaudited)

Nine Months Ended September 30, 2021 (US$ millions)		Share Capital		Paid in Surplus		Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Income			Total Shareholders’ Equity
Balance, December 31, 2020		$	3	$	8,531	$	(5,773	)	$	1,076		$	3,837
Net Earnings (Loss)			-		-		32			-			32
Dividends on Shares of Common Stock ($0.3275 per share)	(Note 12)		-		-		(86	)		-			(86	)
Equity-Settled Compensation Costs			-		22		-			-			22
Other Comprehensive Income (Loss)	(Note 13)		-		-		-			(8	)		(8	)
Balance, September 30, 2021		$	3	$	8,553	$	(5,827	)	$	1,068		$	3,797

Nine Months Ended September 30, 2020 (US$ millions)		Share Capital			Paid in Surplus		Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Income			Total Shareholders’ Equity
Balance, December 31, 2019		$	7,061		$	1,402	$	421		$	1,046		$	9,930
Net Earnings (Loss)			-			-		(5,483	)		-			(5,483	)
Dividends on Shares of Common Stock ($0.28125 per share)	(Note 12)		-			-		(73	)		-			(73	)
Other Comprehensive Income (Loss)	(Note 13)		-			-		-			(22	)		(22	)
Reclassification of Share Capital	(Note 12)		(7,058	)		7,058		-			-			-
Balance, September 30, 2020		$	3		$	8,460	$	(5,135	)	$	1,024		$	4,352

See accompanying Notes to Condensed Consolidated Financial Statements

10

Condensed Consolidated Statement of Cash Flows (unaudited)

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
(US$ millions)		2021			2020			2021			2020
Operating Activities
Net earnings (loss)		$	(72	)	$	(1,521	)	$	32		$	(5,483	)
Depreciation, depletion and amortization			297			406			916			1,433
Impairments	(Note 8)		-			1,336			-			4,863
Accretion of asset retirement obligation			5			8			17			26
Deferred income taxes	(Note 6)		1			(42	)		(19	)		393
Unrealized (gain) loss on risk management	(Note 19)		579			243			1,426			18
Unrealized foreign exchange (gain) loss	(Note 5)		14			(21	)		20			30
Foreign exchange on settlements	(Note 5)		(3	)		(2	)		(12	)		18
Other			24			(9	)		88			(61	)
Net change in other assets and liabilities			(10	)		(47	)		(21	)		(167	)
Net change in non-cash working capital	(Note 20)		(23	)		142			(58	)		106
Cash From (Used in) Operating Activities			812			493			2,389			1,176
Investing Activities
Capital expenditures	(Note 2)		(365	)		(351	)		(1,098	)		(1,393	)
Acquisitions	(Note 7)		-			(1	)		(3	)		(19	)
Proceeds from divestitures	(Note 7)		(8	)		39			1,017			69
Net change in investments and other			6			68			(36	)		(74	)
Cash From (Used in) Investing Activities			(367	)		(245	)		(120	)		(1,417	)
Financing Activities
Net issuance (repayment) of revolving long-term debt	(Note 10)		-			(100	)		(950	)		452
Repayment of long-term debt	(Note 10)		(518	)		(109	)		(1,137	)		(224	)
Dividends on shares of common stock	(Note 12)		(37	)		(24	)		(86	)		(73	)
Finance lease payments and other			(2	)		(23	)		(98	)		(67	)
Cash From (Used in) Financing Activities			(557	)		(256	)		(2,271	)		88
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents
and Restricted Cash Held in Foreign Currency			(2	)		1			-			(5	)
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash			(114	)		(7	)		(2	)		(158	)
Cash, Cash Equivalents and Restricted Cash, Beginning of Period			122			39			10			190
Cash, Cash Equivalents and Restricted Cash, End of Period		$	8		$	32		$	8		$	32
Cash, End of Period		$	7		$	22		$	7		$	22
Cash Equivalents, End of Period			1			10			1			10
Restricted Cash, End of Period			-			-			-			-
Cash, Cash Equivalents and Restricted Cash, End of Period		$	8		$	32		$	8		$	32
Supplementary Cash Flow Information	(Note 20)

See accompanying Notes to Condensed Consolidated Financial Statements

11

1. Basis of Presentation and Principles of Consolidation

Ovintiv is in the business of the exploration for, the development of, and the production and marketing of oil, NGLs and natural gas.

The interim Condensed Consolidated Financial Statements include the accounts of Ovintiv and entities in which it holds a controlling interest. All intercompany balances and transactions are eliminated on consolidation. Undivided interests in oil and natural gas exploration and production joint ventures and partnerships are consolidated on a proportionate basis. Investments in non-controlled entities over which the Company has the ability to exercise significant influence are accounted for using the equity method.  

The interim Condensed Consolidated Financial Statements are prepared in conformity with U.S. GAAP and the rules and regulations of the SEC. Pursuant to these rules and regulations, certain information and disclosures normally required under U.S. GAAP have been condensed or have been disclosed on an annual basis only. Accordingly, the interim Condensed Consolidated Financial Statements should be read in conjunction with the annual audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2020, which are included in Item 8 of Ovintiv’s 2020 Annual Report on Form 10-K.

The interim Condensed Consolidated Financial Statements have been prepared following the same accounting policies and methods of computation as the annual audited Consolidated Financial Statements for the year ended December 31, 2020.

These unaudited interim Condensed Consolidated Financial Statements reflect, in the opinion of Management, all normal and recurring adjustments necessary to present fairly the financial position and results of the Company as at and for the periods presented. Interim condensed consolidated financial results are not necessarily indicative of consolidated financial results expected for the fiscal year.

2. Segmented Information

Ovintiv’s reportable segments are determined based on the following operations and geographic locations:

• USA Operations includes the exploration for, development of, and production of oil, NGLs and natural gas and other related activities within the U.S. cost center.

• Canadian Operations includes the exploration for, development of, and production of oil, NGLs and natural gas and other related activities within the Canadian cost center.

• Market Optimization is primarily responsible for the sale of the Company’s proprietary production. These results are reported in the USA and Canadian Operations. Market optimization activities include third-party purchases and sales of product to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. These activities are reflected in the Market Optimization segment. Market Optimization sells substantially all of the Company’s upstream production to third-party customers. Transactions between segments are based on market values and are eliminated on consolidation.

Corporate and Other mainly includes unrealized gains or losses recorded on derivative financial instruments. Once the instruments are settled, the realized gains and losses are recorded in the reporting segment to which the derivative instruments relate. Corporate and Other also includes amounts related to sublease rentals.

12

Results of Operations (For the three months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	1,286		$	670		$	663		$	310	$	771		$	346
Gains (losses) on risk management, net		(265	)		38			(107	)		49		1			2
Sublease revenues		-			-			-			-		-			-
Total Revenues		1,021			708			556			359		772			348
Operating Expenses
Production, mineral and other taxes		75			43			2			4		-			-
Transportation and processing		122			109			231			203		44			53
Operating		122			104			25			24		5			5
Purchased product		-			-			-			-		759			322
Depreciation, depletion and amortization		207			299			83			99		-			-
Impairments		-			1,336			-			-		-			-
Total Operating Expenses		526			1,891			341			330		808			380
Operating Income (Loss)	$	495		$	(1,183	)	$	215		$	29	$	(36	)	$	(32	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	2,720		$	1,326
Gains (losses) on risk management, net		(579	)		(243	)		(950	)		(154	)
Sublease revenues		19			18			19			18
Total Revenues		(560	)		(225	)		1,789			1,190
Operating Expenses
Production, mineral and other taxes		-			-			77			47
Transportation and processing		-			-			397			365
Operating		1			-			153			133
Purchased product		-			-			759			322
Depreciation, depletion and amortization		7			8			297			406
Impairments		-			-			-			1,336
Accretion of asset retirement obligation		5			8			5			8
Administrative		101			79			101			79
Total Operating Expenses		114			95			1,789			2,696
Operating Income (Loss)	$	(674	)	$	(320	)		-			(1,506	)
Other (Income) Expenses
Interest								77			97
Foreign exchange (gain) loss, net								-			(25	)
Other (gains) losses, net								(6	)		(18	)
Total Other (Income) Expenses								71			54
Net Earnings (Loss) Before Income Tax								(71	)		(1,560	)
Income tax expense (recovery)								1			(39	)
Net Earnings (Loss)							$	(72	)	$	(1,521	)

13

Results of Operations (For the nine months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	3,459		$	1,900		$	1,810		$	906	$	2,171		$	1,113
Gains (losses) on risk management, net		(589	)		412			(164	)		188		3			5
Sublease revenues		-			-			-			-		-			-
Total Revenues		2,870			2,312			1,646			1,094		2,174			1,118
Operating Expenses
Production, mineral and other taxes		199			115			11			11		-			-
Transportation and processing		361			345			703			614		130			170
Operating		368			364			78			75		19			15
Purchased product		-			-			-			-		2,096			1,039
Depreciation, depletion and amortization		635			1,092			265			319		-			-
Impairments		-			4,863			-			-		-			-
Total Operating Expenses		1,563			6,779			1,057			1,019		2,245			1,224
Operating Income (Loss)	$	1,307		$	(4,467	)	$	589		$	75	$	(71	)	$	(106	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	7,440		$	3,919
Gains (losses) on risk management, net		(1,426	)		(18	)		(2,176	)		587
Sublease revenues		55			53			55			53
Total Revenues		(1,371	)		35			5,319			4,559
Operating Expenses
Production, mineral and other taxes		-			-			210			126
Transportation and processing		-			-			1,194			1,129
Operating		1			(2	)		466			452
Purchased product		-			-			2,096			1,039
Depreciation, depletion and amortization		16			22			916			1,433
Impairments		-			-			-			4,863
Accretion of asset retirement obligation		17			26			17			26
Administrative		346			297			346			297
Total Operating Expenses		380			343			5,245			9,365
Operating Income (Loss)	$	(1,751	)	$	(308	)		74			(4,806	)
Other (Income) Expenses
Interest								263			279
Foreign exchange (gain) loss, net								(15	)		51
Other (gains) losses, net								(31	)		(48	)
Total Other (Income) Expenses								217			282
Net Earnings (Loss) Before Income Tax								(143	)		(5,088	)
Income tax expense (recovery)								(175	)		395
Net Earnings (Loss)							$	32		$	(5,483	)

14

Intersegment Information

							Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the three months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	2,705		$	1,445		$	(1,933	)	$	(1,097	)	$	772		$	348
Operating Expenses
Transportation and processing		141			148			(97	)		(95	)		44			53
Operating		5			5			-			-			5			5
Purchased product		2,596			1,324			(1,837	)		(1,002	)		759			322
Operating Income (Loss)	$	(37	)	$	(32	)	$	1		$	-		$	(36	)	$	(32	)

	Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the nine months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	7,486		$	4,587		$	(5,312	)	$	(3,469	)	$	2,174		$	1,118
Operating Expenses
Transportation and processing		427			468			(297	)		(298	)		130			170
Operating		19			15			-			-			19			15
Purchased product		7,111			4,210			(5,015	)		(3,171	)		2,096			1,039
Operating Income (Loss)	$	(71	)	$	(106	)	$	-		$	-		$	(71	)	$	(106	)

Capital Expenditures

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
USA Operations	$	265	$	244	$	805	$	1,090
Canadian Operations		99		106		291		300
Corporate & Other		1		1		2		3
	$	365	$	351	$	1,098	$	1,393

Goodwill, Property, Plant and Equipment and Total Assets by Segment

	Goodwill					Property, Plant and Equipment					Total Assets
	As at					As at					As at
	September 30,		December 31,			September 30,		December 31,			September 30,		December 31,
	2021			2020		2021			2020		2021			2020
USA Operations	$	1,938		$	1,938	$	7,479		$	8,103	$	10,185		$	10,646
Canadian Operations		686			687		920			1,142		1,861			2,031
Market Optimization		-			-		-			2		293			233
Corporate & Other		-			-		191			203		1,297			1,559
	$	2,624		$	2,625	$	8,590		$	9,450	$	13,636		$	14,469

15

3. Revenues from Contracts with Customers

The following tables summarize Ovintiv’s revenues from contracts with customers.

Revenues (For the three months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	866	$	504	$	1	$	1	$	609	$	131
NGLs		250		98		303		139		8		-
Natural gas		172		71		360		172		150		210
Service revenues
Gathering and processing		-		-		1		-		-		-
Product and Service Revenues	$	1,288	$	673	$	665	$	312	$	767	$	341

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	1,476	$	636
NGLs		-		-		561		237
Natural gas		-		-		682		453
Service revenues
Gathering and processing		-		-		1		-
Product and Service Revenues	$	-	$	-	$	2,720	$	1,326

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

Revenues (For the nine months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	2,468	$	1,453	$	7	$	5	$	1,596	$	500
NGLs		587		244		844		406		34		4
Natural gas		413		208		963		501		519		596
Service revenues
Gathering and processing		-		1		4		1		5		-
Product and Service Revenues	$	3,468	$	1,906	$	1,818	$	913	$	2,154	$	1,100

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	4,071	$	1,958
NGLs		-		-		1,465		654
Natural gas		-		-		1,895		1,305
Service revenues
Gathering and processing		-		-		9		2
Product and Service Revenues	$	-	$	-	$	7,440	$	3,919

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

16

The Company’s revenues from contracts with customers consists of product sales including oil, NGLs and natural gas, as well as the provision of gathering and processing services to third parties. Ovintiv had no contract asset or liability balances during the periods presented. As at September 30, 2021, receivables and accrued revenues from contracts with customers were $1,110 million ($814 million as at December 31, 2020).

Ovintiv’s product sales are sold under short-term contracts with terms that are less than one year at either fixed or market index prices or under long-term contracts exceeding one year at market index prices.

The Company’s gathering and processing services are provided on an interruptible basis with transaction prices that are for fixed prices and/or variable consideration. Variable consideration received is related to recovery of plant operating costs or escalation of the fixed price based on a consumer price index. As the service contracts are interruptible, with service provided on an “as available” basis, there are no unsatisfied performance obligations remaining at September 30, 2021.

As at September 30, 2021, all remaining performance obligations are priced at market index prices or are variable volume delivery contracts. As such, the variable consideration is allocated entirely to the wholly unsatisfied performance obligation or promise to deliver units of production, and revenue is recognized at the amount for which the Company has the right to invoice the product delivered. As the period between when the product sales are transferred and Ovintiv receives payments is generally 30 to 60 days, there is no financing element associated with customer contracts. In addition, Ovintiv does not disclose unsatisfied performance obligations for customer contracts with terms less than 12 months or for variable consideration related to unsatisfied performance obligations.

4. Interest

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Interest Expense on:
Debt	$	74	$	91	$	251	$	262
Finance leases		1		2		3		7
Other		2		4		9		10
	$	77	$	97	$	263	$	279

Interest expense on debt for the nine months ended September 30, 2021 includes a one-time make-whole interest payment of $19 million resulting from the June 2021 early redemption of the Company’s $600 million, 5.75 percent senior notes due January 30, 2022 as discussed in Note 10.

17

5. Foreign Exchange (Gain) Loss, Net

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Unrealized Foreign Exchange (Gain) Loss on:
Translation of U.S. dollar financing debt issued from Canada	$	-		$	(6	)	$	1		$	56
Translation of U.S. dollar risk management contracts issued from Canada		14			(15	)		19			1
Translation of intercompany notes		-			-			-			(27	)
		14			(21	)		20			30
Foreign Exchange (Gain) Loss on Settlements of:
U.S. dollar financing debt issued from Canada		-			(2	)		(9	)		15
U.S. dollar risk management contracts issued from Canada		(7	)		(2	)		(25	)		7
Intercompany notes		(3	)		-			(3	)		3
Other Monetary Revaluations		(4	)		-			2			(4	)
	$	-		$	(25	)	$	(15	)	$	51

Following the completion of the corporate reorganization and U.S. domestication in 2020, the U.S. dollar denominated unsecured notes issued by Encana Corporation from Canada were assumed by Ovintiv Inc., a company incorporated in Delaware with a U.S. dollar functional currency. Accordingly, these U.S. dollar denominated unsecured notes, along with certain intercompany notes, no longer attract foreign exchange translation gains or losses.

6. Income Taxes

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Current Tax
United States	$	-		$	4		$	-		$	3
Canada		-			(1	)		(156	)		(1	)
Total Current Tax Expense (Recovery)		-			3			(156	)		2
Deferred Tax
United States		1			(41	)		1			(180	)
Canada		-			-			(20	)		573
Other Countries		-			(1	)		-			-
Total Deferred Tax Expense (Recovery)		1			(42	)		(19	)		393
Income Tax Expense (Recovery)	$	1		$	(39	)	$	(175	)	$	395
Effective Tax Rate		(1.4	%)		2.5	%		122.4	%		(7.8	%)

Ovintiv’s interim income tax expense is determined using the estimated annual effective income tax rate applied to year-to-date net earnings before income tax plus the effect of legislative changes and amounts in respect of prior periods. The estimated annual effective income tax rate is impacted by expected annual earnings, changes in valuation allowances, income tax related to foreign operations, state tax, the effect of legislative changes, non-taxable capital gains and losses, and tax differences on divestitures and transactions, which can produce interim effective tax rate fluctuations.

During the nine months ended September 30, 2021, the current income tax recovery was primarily due to the resolution of prior year tax items. The resolution, along with other items, resulted in a $222 million reduction of unrecognized tax benefits, offset by a $66 million reduction in valuation allowance. The Company also recognized related interest income of $12 million in other (gains) losses, net. During the nine months ended September 30, 2021, the deferred tax recovery was primarily due to the change in valuation allowances recorded relating to the current year net loss before tax and from the resolution of prior year tax items. During the nine months ended September 30, 2020, the deferred tax expense was primarily due to the recognition of a valuation allowance to reduce the associated deferred tax assets in the United States and Canada.

The effective tax rate of 122.4 percent for the nine months ended September 30, 2021 is higher than the U.S. federal statutory tax rate of 21 percent primarily due to the resolution of certain tax items relating to prior taxation years and the change in

18

valuation allowances recorded relating to the current year net loss before tax. The effective tax rate of (7.8) percent for the nine months ended September 30, 2020 was lower than the U.S. federal statutory tax rate of 21 percent primarily due to valuation allowances recorded due to net losses arising from ceiling test impairments and an increase in the valuation allowance of $568 million in Canada related to prior years’ deferred tax assets which was recorded as a discrete item. See Note 8 for further discussion related to the ceiling test impairments.

7. Acquisitions and Divestitures

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2021		2020			2021			2020
Acquisitions
USA Operations	$	-	$	1		$	3		$	19
Total Acquisitions		-		1			3			19
Divestitures
USA Operations		7		(36	)		(767	)		(63	)
Canadian Operations		1		(3	)		(250	)		(6	)
Total Divestitures		8		(39	)		(1,017	)		(69	)
Net Acquisitions & (Divestitures)	$	8	$	(38	)	$	(1,014	)	$	(50	)

Acquisitions

For the nine months ended September 30, 2020, acquisitions in the USA Operations were $19 million, which primarily included property purchases with oil and liquids rich potential.

Divestitures

For the nine months ended September 30, 2021, divestitures in the USA Operations were $767 million, which primarily included the sale of the Eagle Ford assets located in south Texas for proceeds of approximately $762 million, after closing and other adjustments. For the nine months ended September 30, 2020, divestitures in the USA Operations were $63 million, which primarily included the sale of certain properties that did not complement Ovintiv’s existing portfolio of assets.

For the nine months ended September 30, 2021, divestitures in the Canadian Operations were $250 million, which primarily included the sale of the Duvernay assets located in west central Alberta for proceeds of approximately $238 million, after closing and other adjustments.

Amounts received from the Company’s divestiture transactions have been deducted from the respective U.S. and Canadian full cost pools.

As part of the Duvernay asset divestiture, the Company agreed to a contingent consideration arrangement, which is payable to Ovintiv in the amount of C$5 million at the end of 2021 and an additional C$10 million at the end of 2022, if the annual average of the WTI reference price for each calendar year is greater than $56 per barrel and $62 per barrel, respectively. The contingent consideration was determined to be an embedded derivative and accordingly, the Company recorded the contingent consideration at its fair value of $6 million on the closing date. Subsequent changes in the fair value of the contingent consideration are recognized as a gain or loss and presented in gains (losses) on risk management, net in the Condensed Consolidated Statement of Earnings. The fair value is presented in accounts receivable and accrued revenues, and other assets in the Condensed Consolidated Balance Sheet. See Notes 18 and 19 for further information on the contingent consideration.

19

8. Property, Plant and Equipment, Net

	As at September 30, 2021							As at December 31, 2020
			Accumulated							Accumulated
	Cost		DD&A			Net		Cost		DD&A			Net
USA Operations
Proved properties	$	38,530	$	(33,217	)	$	5,313	$	37,875	$	(32,581	)	$	5,294
Unproved properties		2,153		-			2,153		2,785		-			2,785
Other		13		-			13		24		-			24
		40,696		(33,217	)		7,479		40,684		(32,581	)		8,103
Canadian Operations
Proved properties		16,154		(15,307	)		847		16,008		(15,056	)		952
Unproved properties		64		-			64		177		-			177
Other		9		-			9		13		-			13
		16,227		(15,307	)		920		16,198		(15,056	)		1,142
Market Optimization		7		(7	)		-		9		(7	)		2
Corporate & Other		868		(677	)		191		865		(662	)		203
	$	57,798	$	(49,208	)	$	8,590	$	57,756	$	(48,306	)	$	9,450

USA and Canadian Operations’ property, plant and equipment include internal costs directly related to exploration, development and construction activities of $124 million, which have been capitalized during the nine months ended September 30, 2021 (2020 - $133 million).

For the three and nine months ended September 30, 2021, Ovintiv did not recognize ceiling test impairments in the USA Operations (2020 - $1,336 million and $4,863 million before tax, respectively) or Canadian Operations (2020 - nil, respectively). The non-cash ceiling test impairments recognized in the USA Operations in 2020 are included with accumulated DD&A in the table above and primarily resulted from the decline in the 12-month average trailing prices, which reduced proved reserves.

The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices presented below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.

	Oil & NGLs				Natural Gas
	WTI		Edmonton Condensate		Henry Hub		AECO
	($/bbl)		(C$/bbl)		($/MMBtu)		(C$/MMBtu)
12-Month Average Trailing Reserves Pricing (1)
September 30, 2021	$	57.69	$	72.45	$	2.94	$	2.79
December 31, 2020		39.62		49.77		1.98		2.13
September 30, 2020		43.69		53.93		1.97		2.01

(1) All prices were held constant in all future years when estimating net revenues and reserves.

9. Leases

The following table outlines Ovintiv’s estimated future sublease income as at September 30, 2021. All subleases are classified as operating leases.

(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Sublease Income	$	13	$	48	$	46	$	46	$	46	$	521	$	720

For the three and nine months ended September 30, 2021, operating lease income was $15 million and $42 million, respectively (2020 - $14 million and $40 million, respectively), and variable lease income was $4 million and $13 million, respectively (2020 - $4 million and $13 million, respectively).

20

10. Long-Term Debt

	As at			As at
	September 30,			December 31,
	2021			2020
U.S. Dollar Denominated Debt
Revolving credit and term loan borrowings	$	-		$	950
U.S. Unsecured Notes:
3.90% due November 15, 2021		-			518
5.75% due January 30, 2022		-			600
5.625% due July 1, 2024		1,000			1,000
5.375% due January 1, 2026		688			688
8.125% due September 15, 2030		300			300
7.20% due November 1, 2031		350			350
7.375% due November 1, 2031		500			500
6.50% due August 15, 2034		750			750
6.625% due August 15, 2037		462			462
6.50% due February 1, 2038		488			488
5.15% due November 15, 2041		203			203
Total Principal		4,741			6,809
Increase in Value of Debt Acquired		82			111
Unamortized Debt Discounts and Issuance Costs		(32	)		(35	)
Total Long-Term Debt	$	4,791		$	6,885
Current Portion	$	-		$	518
Long-Term Portion		4,791			6,367
	$	4,791		$	6,885

On June 18, 2021, the Company completed the redemption of its $600 million, 5.75 percent senior notes due January 30, 2022. Ovintiv paid approximately $632 million in cash including accrued and unpaid interest of $13 million and a one-time make-whole payment of $19 million, which is included in interest expense as discussed in Note 4.

On August 16, 2021, the Company completed the redemption of its $518 million, 3.90 percent senior notes due November 15, 2021. The Company redeemed the notes at par and paid approximately $523 million in cash including accrued and unpaid interest of $5 million.

The Company used the net proceeds from its Eagle Ford and Duvernay asset sales, as discussed in Note 7, and cash on hand to complete the senior note redemptions.

During the three and nine months ended September 30, 2020, the Company repurchased in the open market approximately $115 million and $252 million, respectively, in principal amount of its senior notes. The aggregate cash payments related to the note repurchases were $109 million and $224 million, respectively, plus accrued interest, and net gains of approximately $6 million and $28 million, respectively, were recognized in other (gains) losses, net in the Condensed Consolidated Statement of Earnings.

As at September 30, 2021, total long-term debt had a carrying value of $4,791 million and a fair value of $5,989 million (as at December 31, 2020 - carrying value of $6,885 million and a fair value of $7,379 million). The estimated fair value of long-term borrowings is categorized within Level 2 of the fair value hierarchy and has been determined based on market information of long-term debt with similar terms and maturity, or by discounting future payments of interest and principal at interest rates expected to be available to the Company at period end.

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11. Other Liabilities and Provisions

	As at		As at
	September 30,		December 31,
	2021		2020
Finance Lease Obligations	$	35	$	39
Unrecognized Tax Benefits (See Note 6)		-		158
Pensions and Other Post-Employment Benefits		129		129
Long-Term Incentive Costs (See Note 16)		31		9
Other Derivative Contracts (See Notes 18, 19)		5		7
Other		15		16
	$	215	$	358

12. Share Capital

Authorized

Ovintiv is authorized to issue 750 million shares of common stock, par value $0.01 per share, and 25 million shares of preferred stock, par value $0.01 per share. No shares of preferred stock are outstanding.

Issued and Outstanding

	As at September 30, 2021				As at December 31, 2020
	Number (millions)		Amount		Number (millions)		Amount
Shares of Common Stock Outstanding, Beginning of Year		259.8	$	3		259.8	$	7,061
Shares of Common Stock Issued (See Note 16)		1.3		-		-		-
Reclassification of Share Capital		-		-		-		(7,058	)
Shares of Common Stock Outstanding, End of Period		261.1	$	3		259.8	$	3

In conjunction with the corporate reorganization and U.S. domestication completed in 2020, the amount recognized in share capital in excess of Ovintiv’s established par value of $0.01 per share was reclassified to paid in surplus. Accordingly, approximately $7,058 million was reclassified.

On September 28, 2021, the Company announced it had received regulatory approval to purchase, for cancellation, up to approximately 26.0 million shares of common stock, pursuant to a NCIB over a 12-month period from October 1, 2021 to September 30, 2022.

Dividends

During the three months ended September 30, 2021, the Company declared and paid dividends of $0.14 per share of Ovintiv common stock totaling $37 million (2020 - $0.09375 per share of Ovintiv common stock totaling $24 million).

During the nine months ended September 30, 2021, the Company declared and paid dividends of $0.3275 per share of Ovintiv common stock totaling $86 million (2020 - $0.28125 per share of Ovintiv common stock totaling $73 million).

On November 2, 2021, the Board of Directors declared a dividend of $0.14 per share of Ovintiv common stock payable on December 31, 2021 to stockholders of record as of December 15, 2021.

22

Earnings Per Share of Common Stock

The following table presents the computation of net earnings (loss) per share of common stock:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(US$ millions, except per share amounts)	2021			2020			2021		2020
Net Earnings (Loss)	$	(72	)	$	(1,521	)	$	32	$	(5,483	)
Number of Shares of Common Stock:
Weighted average shares of common stock outstanding - Basic		261.1			259.8			260.7		259.8
Effect of dilutive securities (1) (2)		-			-			4.6		-
Weighted Average Shares of Common Stock Outstanding - Diluted		261.1			259.8			265.3		259.8
Net Earnings (Loss) per Share of Common Stock
Basic	$	(0.28	)	$	(5.85	)	$	0.12	$	(21.10	)
Diluted (1) (2)		(0.28	)		(5.85	)		0.12		(21.10	)

(1) During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain Performance Share Units (“PSUs”) and Restricted Share Units (“RSUs”) with the issuance of the Company’s common stock. As a result, the stock-based compensation awards were modified and reclassified as equity-settled awards.

(2) For the three months ended September 30, 2021, all of Ovintiv’s equity-settled awards were determined to be antidilutive and therefore are excluded from the calculation of fully diluted net earnings (loss) per share of common stock.

Shares issued as a result of awards granted from stock-based compensation plans are generally funded out of the common stock authorized for issuance as approved by the Company’s shareholders.

Stock-Based Compensation Plans

Ovintiv’s PSU and RSU stock-based compensation plans allow the Company to settle the awards either in cash or in the Company’s common stock. The PSUs and RSUs are classified as equity-settled if the Company has sufficient common stock held in reserve for issuance. These awards are included in the computation of diluted net earnings (loss) per share of common stock if dilutive.

Ovintiv’s stock options with associated Tandem Stock Appreciation Rights (“TSARs”) give the employee the right to purchase shares of common stock of the Company or receive cash. Historically, most holders of options have elected to exercise their TSARs in exchange for a cash payment. As a result, outstanding options are not considered potentially dilutive securities.

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13. Accumulated Other Comprehensive Income

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Foreign Currency Translation Adjustment
Balance, Beginning of Period	$	1,086		$	957		$	1,042		$	1,004
Change in Foreign Currency Translation Adjustment		(48	)		26			(4	)		(21	)
Balance, End of Period	$	1,038		$	983		$	1,038		$	983
Pension and Other Post-Employment Benefit Plans
Balance, Beginning of Period	$	31		$	43		$	34		$	42
Amounts Reclassified from Other Comprehensive Income:
Reclassification of net actuarial (gains) and losses to net earnings (See Note 17)		(1	)		(2	)		(5	)		(6	)
Income taxes		-			-			1			1
Curtailment in net defined periodic benefit cost (See Note 17)		-			-			-			5
Income taxes		-			-			-			(1	)
Balance, End of Period	$	30		$	41		$	30		$	41
Total Accumulated Other Comprehensive Income	$	1,068		$	1,024		$	1,068		$	1,024

14. Variable Interest Entities

Veresen Midstream Limited Partnership

Veresen Midstream Limited Partnership (“VMLP”) provides gathering, compression and processing services under various agreements related to the Company’s development of liquids and natural gas production in the Montney play. As at September 30, 2021, VMLP provides approximately 1,167 MMcf/d of natural gas gathering and compression and 925 MMcf/d of natural gas processing under long-term service agreements with remaining terms ranging from 10 to 24 years and have various renewal terms providing up to a potential maximum of 10 years.

Ovintiv has determined that VMLP is a VIE and that Ovintiv holds variable interests in VMLP. Ovintiv is not the primary beneficiary as the Company does not have the power to direct the activities that most significantly impact VMLP’s economic performance. These key activities relate to the construction, operation, maintenance and marketing of the assets owned by VMLP. The variable interests arise from certain terms under the various long-term service agreements and include: i) a take or pay for volumes in certain agreements; ii) an operating fee of which a portion can be converted into a fixed fee once VMLP assumes operatorship of certain assets; and iii) a potential payout of minimum costs in certain agreements. The potential payout of minimum costs will be assessed in the eighth year of the assets’ service period and is based on whether there is an overall shortfall of total system cash flows from natural gas gathered and compressed under certain agreements. The potential payout amount can be reduced in the event VMLP markets unutilized capacity to third-party users. Ovintiv is not required to provide any financial support or guarantees to VMLP.

As a result of Ovintiv’s involvement with VMLP, the maximum total exposure to loss related to the commitments under the agreements is estimated to be $1,782 million as at September 30, 2021. The estimate comprises the take or pay volume commitments and the potential payout of minimum costs. The take or pay volume commitments associated with certain gathering and processing assets are included in Note 21 under Transportation and Processing. The potential payout requirement is highly uncertain as the amount is contingent on future production estimates, pace of development and the amount of capacity contracted to third parties. As at September 30, 2021, accounts payable and accrued liabilities included $0.5 million related to the take or pay commitment.

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15. Restructuring Charges

In June 2020, Ovintiv undertook a plan to reduce its workforce by approximately 25 percent as part of a company-wide reorganization in response to the low commodity price environment resulting from the global pandemic and the Company’s planned reductions in capital spending. During the three and nine months ended September 30, 2021, the Company incurred restructuring charges of $2 million and $13 million, respectively (2020 - $7 million and $88 million, respectively), before tax, primarily related to severance costs. Of the $103 million in restructuring charges incurred to date, $3 million remains accrued as at September 30, 2021 ($14 million as at December 31, 2020). The majority of the remaining amounts accrued are expected to be paid in 2021 and total transition and severance costs are expected to be approximately $104 million, before tax.

Restructuring charges are included in administrative expense presented in the Corporate and Other segment in the Condensed Consolidated Statement of Earnings.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Severance and Benefits	$	2	$	6	$	13	$	86
Outplacement, Moving and Other Expenses		-		1		-		2
Restructuring Expenses	$	2	$	7	$	13	$	88

	As at			As at
	September 30,			December 31,
	2021			2020
Outstanding Restructuring Accrual, Beginning of Year	$	14		$	8
Restructuring Expenses Incurred		13			90
Restructuring Costs Paid		(24	)		(84	)
Outstanding Restructuring Accrual, End of Period (1)	$	3		$	14

(1) Included in accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheet.

16. Compensation Plans

Ovintiv has a number of compensation arrangements under which the Company awards various types of long-term incentive grants to eligible employees and Directors. They may include TSARs, Stock Appreciation Rights (“SARs”), PSUs, Deferred Share Units (“DSUs”) and RSUs.

Ovintiv accounts for PSUs and RSUs as equity-settled stock-based payment transactions provided there is sufficient common stock held in reserve for issuance. TSARs, SARs and DSUs are accounted for as cash-settled stock-based payment transactions. The Company accrues compensation costs over the vesting period based on the fair value of the rights determined using the Black-Scholes-Merton or other appropriate fair value models.

During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain PSU awards and RSU awards with the issuance of the Company’s common stock. Historically, the Company settled PSU and RSU awards in cash. As a result, the respective awards were modified and reclassified as equity-settled share-based payment transactions at the modification date. The modified awards accrue compensation expense using the modification date fair value of the awards over the remaining vesting period. Common stock used to settle the PSU and RSU awards will be issued from Ovintiv’s common stock authorized and held in reserve for issuance under the Company’s stock-based compensation plans.

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The following weighted average assumptions were used to determine the fair value of TSAR and SAR units outstanding:  

	As at September 30, 2021		As at September 30, 2020
	US$ SAR Share Units	C$ TSAR Share Units	US$ SAR Share Units	C$ TSAR Share Units
Risk Free Interest Rate	0.49%	0.49%	0.22%	0.22%
Dividend Yield	1.70%	1.68%	4.60%	4.66%
Expected Volatility Rate (1)	106.19%	105.03%	102.43%	101.65%
Expected Term	1.5 yrs	1.5 yrs	2.5 yrs	2.0 yrs
Market Share Price	US$32.88	C$41.62	US$8.16	C$10.89
Weighted Average Grant Date Fair Value	US$37.63	C$50.46	US$38.11	C$48.28

(1) Volatility was estimated using historical rates.

The Company has recognized the following share-based compensation costs:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Total Compensation Costs of Transactions Classified as Cash-Settled	$	33		$	4		$	115		$	(12	)
Total Compensation Costs of Transactions Classified as Equity-Settled		7			-			25			-
Less: Total Share-Based Compensation Costs Capitalized		(7	)		(2	)		(23	)		3
Total Share-Based Compensation Expense (Recovery)	$	33		$	2		$	117		$	(9	)
Recognized in the Condensed Consolidated Statement of Earnings in:
Operating	$	8		$	1		$	26		$	(3	)
Administrative		25			1			91			(6	)
	$	33		$	2		$	117		$	(9	)

As at September 30, 2021, the liability for cash-settled share-based payment transactions totaled $109 million ($34 million as at December 31, 2020), of which $78 million ($25 million as at December 31, 2020) is recognized in accounts payable and accrued liabilities and $31 million ($9 million as at December 31, 2020) is recognized in other liabilities and provisions in the Condensed Consolidated Balance Sheet.

The following units were granted primarily in conjunction with the Company’s annual grant of long-term incentive awards. The PSUs and RSUs were granted at the volume-weighted average trading price of shares of Ovintiv common stock for the five days prior to the grant date.

Nine Months Ended September 30, 2021 (thousands of units)
RSUs	2,748
PSUs	934
DSUs	14

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17. Pension and Other Post-Employment Benefits

The Company has recognized total benefit plans expense which includes pension benefits and other post-employment benefits (“OPEB”) for the nine months ended September 30 as follows:

	Pension Benefits				OPEB					Total
	2021		2020		2021			2020		2021			2020
Net Defined Periodic Benefit Cost	$	-	$	-	$	(2	)	$	2	$	(2	)	$	2
Defined Contribution Plan Expense		19		24		-			-		19			24
Total Benefit Plans Expense	$	19	$	24	$	(2	)	$	2	$	17		$	26

Of the total benefit plans expense, $18 million (2020 - $22 million) was included in operating expense and $4 million (2020 - $5 million) was included in administrative expense. Excluding service costs, net defined periodic benefit gains of $5 million (2020 - $1 million) were recorded in other (gains) losses, net.

The net defined periodic benefit cost for the nine months ended September 30 is as follows:

	Defined Benefits						OPEB						Total
	2021			2020			2021			2020			2021			2020
Service Cost	$	-		$	-		$	3		$	3		$	3		$	3
Interest Cost		3			4			1			2			4			6
Expected Return on Plan Assets		(4	)		(5	)		-			-			(4	)		(5	)
Amounts Reclassified from Accumulated Other     Comprehensive Income:
Amortization of net actuarial (gains) and losses		1			1			(6	)		(7	)		(5	)		(6	)
Curtailment from net prior service costs		-			-			-			5			-			5
Curtailment		-			-			-			(1	)		-			(1	)
Total Net Defined Periodic Benefit Cost (1)	$	-		$	-		$	(2	)	$	2		$	(2	)	$	2

(1) The components of total net defined periodic benefit cost, excluding the service cost component, are included in other (gains) losses, net.

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18. Fair Value Measurements

The fair values of cash and cash equivalents, accounts receivable and accrued revenues, and accounts payable and accrued liabilities approximate their carrying amounts due to the short-term maturity of those instruments. The fair values of restricted cash and marketable securities included in other assets approximate their carrying amounts due to the nature of the instruments held.

Recurring fair value measurements are performed for risk management assets and liabilities and other derivative contracts, as discussed further in Note 19. These items are carried at fair value in the Condensed Consolidated Balance Sheet and are classified within the three levels of the fair value hierarchy in the following tables.

Fair value changes and settlements for amounts related to risk management assets and liabilities are recognized in revenues and foreign exchange gains and losses according to their purpose.

As at September 30, 2021	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	41	$	-	$	41	$	(41	)	$	-
Long-term assets		-		2		-		2		(2	)		-
Foreign Currency Derivatives:
Current assets		-		7		-		7		(6	)		1
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	4	$	1,163	$	298	$	1,465	$	(41	)	$	1,424
Long-term liabilities		-		211		37		248		(2	)		246
Foreign Currency Derivatives:
Current liabilities		-		-		-		-		(6	)		(6	)
Other Derivative Contracts (2)
Current in accounts receivable and accrued revenues	$	-	$	-	$	4	$	4	$	-		$	4
Long-term in other assets		-		-		5		5		-			5
Current in accounts payable and accrued liabilities		-		1		-		1		-			1
Long-term in other liabilities and provisions		-		5		-		5		-			5

As at December 31, 2020	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	70	$	-	$	70	$	(59	)	$	11
Long-term assets		-		7		-		7		(3	)		4
Foreign Currency Derivatives:
Current assets		-		26		-		26		-			26
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	1	$	114	$	74	$	189	$	(59	)	$	130
Long-term liabilities		-		128		-		128		(3	)		125
Other Derivative Contracts (2)
Current in accounts payable and accrued liabilities	$	-	$	1	$	-	$	1	$	-		$	1
Long-term in other liabilities and provisions		-		7		-		7		-			7

(1) Netting to offset derivative assets and liabilities where the legal right and intention to offset exists, or where counterparty master netting arrangements contain provisions for net settlement.

(2) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

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The Company’s Level 1 and Level 2 risk management assets and liabilities consist of commodity fixed price contracts, NYMEX fixed price swaptions, NYMEX three-way options, NYMEX costless collars, NYMEX call options, foreign currency swaps and basis swaps with terms to 2025. Level 2 also includes financial guarantee contracts as discussed in Note 19. The fair values of these contracts are estimated using inputs which are either directly or indirectly observable from active markets, such as exchange and other published prices, broker quotes and observable trading activity throughout the term of the instruments.

Level 3 Fair Value Measurements

As at September 30, 2021, the Company’s Level 3 risk management assets and liabilities consist of WTI three-way options, WTI costless collars and contingent consideration derivative contracts tied to WTI with terms to 2022. The WTI three-way options are a combination of a sold call, bought put and a sold put. The WTI costless collars are a combination of a sold call and a bought put. These contracts allow the Company to participate in the upside of commodity prices to the ceiling of the call option and provide the Company with complete (collars) or partial (three-way) downside price protection through the put options. The fair values of these contracts are determined using an option pricing model using observable and unobservable inputs such as implied volatility. The unobservable inputs are obtained from third parties whenever possible and reviewed by the Company for reasonableness.

A summary of changes in Level 3 fair value measurements for risk management positions is presented below:

	Nine Months Ended
	September 30,
	2021			2020
Balance, Beginning of Year	$	(74	)	$	(52	)
Total Gains (Losses)		(637	)		214
Purchases, Sales, Issuances and Settlements:
Purchases, sales and issuances (1)		6			-
Settlements		379			(83	)
Transfers Out of Level 3		-			-
Balance, End of Period	$	(326	)	$	79
Change in Unrealized Gains (Losses) During the    Period Included in Net Earnings (Loss)	$	(258	)	$	131

(1) Relates to the contingent consideration associated with the Duvernay divestiture discussed in Note 7.

Quantitative information about unobservable inputs used in Level 3 fair value measurements is presented below as at September 30, 2021:

	Valuation Technique	Unobservable Input	Range	Weighted Average (1)
Risk Management - WTI Options	Option Model	Implied Volatility	34% - 138%	48%

(1) Unobservable inputs were weighted by the relative fair value of the instruments.

A 10 percent increase or decrease in implied volatility for the WTI options would cause an approximate corresponding $17 million ($6 million as at December 31, 2020) increase or decrease to net risk management assets and liabilities.

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19. Financial Instruments and Risk Management

A)  Financial Instruments

Ovintiv’s financial assets and liabilities are recognized in cash and cash equivalents, accounts receivable and accrued revenues, other assets, accounts payable and accrued liabilities, risk management assets and liabilities, long-term debt, and other liabilities and provisions.

B)  Risk Management Activities

Ovintiv uses derivative financial instruments to manage its exposure to cash flow variability from commodity prices and fluctuating foreign currency exchange rates. The Company does not apply hedge accounting to any of its derivative financial instruments. As a result, gains and losses from changes in the fair value are recognized in net earnings (loss).

Commodity Price Risk

Commodity price risk arises from the effect that fluctuations in future commodity prices may have on future cash flows. To partially mitigate exposure to commodity price risk, the Company has entered into various derivative financial instruments.  The use of these derivative instruments is governed under formal policies and is subject to limits established by the Board of Directors.

Crude Oil and NGLs - To partially mitigate crude oil and NGL commodity price risk, the Company uses WTI- and NGL-based contracts such as fixed price contracts, options and costless collars. Ovintiv has also entered into basis swaps to manage against widening price differentials between various production areas, products and price points.

Natural Gas - To partially mitigate natural gas commodity price risk, the Company uses NYMEX-based contracts such as fixed price contracts, fixed price swaptions, options and costless collars. Ovintiv has also entered into basis swaps to manage against widening price differentials between various production areas and benchmark price points.

Foreign Exchange Risk

Foreign exchange risk arises from changes in foreign currency exchange rates that may affect the fair value or future cash flows of the Company’s financial assets or liabilities. To partially mitigate the effect of foreign exchange fluctuations on future commodity revenues and expenses, the Company may enter into foreign currency derivative contracts. As at September 30, 2021, the Company has entered into $88 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.3720 to US$1, which mature monthly through the remainder of 2021 and $100 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.2820 to US$1, which mature monthly throughout 2022.

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Risk Management Positions as at September 30, 2021

	Notional Volumes	Term	Average Price		Fair Value
Crude Oil and NGL Contracts			US$/bbl
Fixed Price Contracts
WTI Fixed Price	30.0 Mbbls/d	2021		46.37	$	(77	)
WTI Fixed Price	5.0 Mbbls/d	2022		60.16		(18	)
Ethane Fixed Price	8.0 Mbbls/d	2021		11.05		(5	)
Propane Fixed Price	12.0 Mbbls/d	2021		25.78		(38	)
Butane Fixed Price	5.0 Mbbls/d	2021		24.83		(19	)
WTI Three-Way Options
Sold call / bought put / sold put	85.0 Mbbls/d	2021	53.92 / 44.66 / 34.79			(136	)
Sold call / bought put / sold put	75.0 Mbbls/d	2022	70.79 / 60.82 / 49.33			(164	)
WTI Costless Collars
Sold call / bought put	15.0 Mbbls/d	2021	45.84 / 35.00			(35	)
Basis Contracts (1)		2021				(4	)
		2022				(1	)
Other Crude Financial Positions						-
Crude Oil and NGLs Fair Value Position						(497	)
Natural Gas Contracts			US$/Mcf
Fixed Price Contracts
NYMEX Fixed Price	165 MMcf/d	2021		2.51		(52	)
NYMEX Fixed Price	200 MMcf/d	2022		2.67		(125	)
NYMEX Fixed Price Swaptions (2)	165 MMcf/d	2022		2.51		(113	)
NYMEX Three-Way Options
Sold call / bought put / sold put	980 MMcf/d	2021	3.36 / 2.89 / 2.50			(230	)
Sold call / bought put / sold put	398 MMcf/d	2022	3.02 / 2.75 / 2.00			(205	)
NYMEX Costless Collars
Sold call / bought put	200 MMcf/d	2022	2.85 / 2.55			(116	)
NYMEX Call Options
Sold call	330 MMcf/d	2022		2.38		(244	)
Basis Contracts (3)		2021				(9	)
		2022				(29	)
		2023 - 2025				(34	)
Other Financial Positions						(16	)
Natural Gas Fair Value Position						(1,173	)
Other Derivative Contracts
Fair Value Position (4)						3
Foreign Currency Contracts
Fair Value Position (5)		2021 - 2022				7
Total Fair Value Position					$	(1,660	)

(1) Ovintiv has entered into crude and NGL differential swaps associated with Canadian condensate and WTI.

(2) NYMEX Fixed Price Swaptions give the counterparty the option to extend certain 2021 Fixed Price swaps to 2022.

(3) Ovintiv has entered into natural gas basis swaps associated with AECO, Dawn, Malin, Waha, Houston Ship Channel and NYMEX.

(4) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

(5) Ovintiv has entered into U.S. dollar denominated fixed-for-floating average currency swaps to protect against fluctuations between the Canadian and U.S. dollars.

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Earnings Impact of Realized and Unrealized Gains (Losses) on Risk Management Positions

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Realized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (1)	$	(371	)	$	89		$	(750	)	$	605
Foreign Currency Derivatives:
Foreign exchange		7			2			25			(7	)
	$	(364	)	$	91		$	(725	)	$	598
Unrealized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (2)	$	(579	)	$	(243	)	$	(1,426	)	$	(18	)
Foreign Currency Derivatives:
Foreign exchange		(11	)		15			(19	)		(1	)
	$	(590	)	$	(228	)	$	(1,445	)	$	(19	)
Total Realized and Unrealized Gains (Losses) on Risk Management, net
Commodity and Other Derivatives:
Revenues (1) (2)	$	(950	)	$	(154	)	$	(2,176	)	$	587
Foreign Currency Derivatives:
Foreign exchange		(4	)		17			6			(8	)
	$	(954	)	$	(137	)	$	(2,170	)	$	579

(1) Includes realized gains of nil and $1 million for the three and nine months ended September 30, 2021, respectively (2020 - gains of nil and $2 million, respectively), related to other derivative contracts.

(2) Includes unrealized gains of $1 million and $4 million for the three and nine months ended September 30, 2021, respectively (2020 - losses of nil and $4 million, respectively), related to other derivative contracts.

Reconciliation of Unrealized Risk Management Positions from January 1 to September 30

	2021						2020
	Fair Value			Total Unrealized Gain (Loss)			Total Unrealized Gain (Loss)
Fair Value of Contracts, Beginning of Year	$	(222	)
Change in Fair Value of Contracts in Place at Beginning of Year    and Contracts Entered into During the Period		(2,170	)	$	(2,170	)	$	579
Settlement of Other Derivative Contracts		1
Fair Value of Other Derivative Contract Assets Entered into    During the Period (See Note 7)		6
Fair Value of Contracts Realized During the Period		725			725			(598	)
Fair Value of Contracts, End of Period	$	(1,660	)	$	(1,445	)	$	(19	)

Risk management assets and liabilities arise from the use of derivative financial instruments and are measured at fair value.  See Note 18 for a discussion of fair value measurements.

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Unrealized Risk Management Positions

	As at			As at
	September 30,			December 31,
	2021			2020
Risk Management Assets
Current	$	1		$	37
Long-term		-			4
		1			41
Risk Management Liabilities
Current		1,418			130
Long-term		246			125
		1,664			255
Other Derivative Contract Assets
Current in accounts receivable and accrued revenues		4			-
Long-term in other assets		5			-
		9			-
Other Derivative Contract Liabilities
Current in accounts payable and accrued liabilities		1			1
Long-term in other liabilities and provisions		5			7
		6			8
Net Risk Management Assets (Liabilities) and Other Derivative Contracts	$	(1,660	)	$	(222	)

C)  Credit Risk

Credit risk arises from the potential that the Company may incur a loss if a counterparty to a financial instrument fails to meet its obligation in accordance with agreed terms. While exchange-traded contracts are subject to nominal credit risk due to the financial safeguards established by the NYSE and the TSX, over-the-counter traded contracts expose Ovintiv to counterparty credit risk. Counterparties to the Company’s derivative financial instruments consist primarily of major financial institutions and companies within the energy industry. This credit risk exposure is mitigated through the use of credit policies approved by the Board of Directors governing the Company’s credit portfolio including credit practices that limit transactions according to counterparties’ credit quality. Mitigation strategies may include master netting arrangements, requesting collateral, purchasing credit insurance and/or transacting credit derivatives. The Company executes commodity derivative financial instruments under master agreements that have netting provisions that provide for offsetting payables against receivables. Ovintiv actively evaluates the creditworthiness of its counterparties, assigns appropriate credit limits and monitors credit exposures against those assigned limits. As at September 30, 2021, Ovintiv’s maximum exposure of loss due to credit risk from derivative financial instrument assets on a gross and net fair value basis was $59 million and $10 million, respectively, as disclosed in Note 18. The Company had no significant credit derivatives in place and held no collateral at September 30, 2021.

As at September 30, 2021, cash equivalents include high-grade, short-term securities, placed primarily with financial institutions with strong investment grade ratings. Any foreign currency agreements entered into are with major financial institutions that have investment grade credit ratings.  

A substantial portion of the Company’s accounts receivable are with customers and working interest owners in the oil and gas industry and are subject to normal industry credit risks. As at September 30, 2021, approximately 91 percent (89 percent as at December 31, 2020) of Ovintiv’s accounts receivable and financial derivative credit exposures were with investment grade counterparties.

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During 2015 and 2017, the Company entered into agreements resulting from divestitures, which may require Ovintiv to fulfill certain payment obligations on the take or pay volume commitments assumed by the purchasers. The circumstances that would require Ovintiv to perform under the agreements include events where a purchaser fails to make payment to the guaranteed party and/or a purchaser is subject to an insolvency event. The agreements have remaining terms of less than three years with a fair value recognized of $6 million as at September 30, 2021 ($8 million as at December 31, 2020). The maximum potential amount of undiscounted future payments is $63 million as at September 30, 2021, and is considered unlikely.

20. Supplementary Information

Supplemental disclosures to the Condensed Consolidated Statement of Cash Flows are presented below:

A) Net Change in Non-Cash Working Capital

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Operating Activities
Accounts receivable and accrued revenues	$	(25	)	$	78		$	(287	)	$	289
Accounts payable and accrued liabilities		13			42			211			(212	)
Current portion of operating lease liabilities		(9	)		(4	)		(5	)		(10	)
Income tax receivable and payable		(2	)		26			23			39
	$	(23	)	$	142		$	(58	)	$	106

B) Non-Cash Activities

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Non-Cash Operating Activities
ROU operating lease assets and liabilities	$	(4	)	$	(5	)	$	(22	)	$	(6	)
Non-Cash Investing Activities
Asset retirement obligation incurred	$	-		$	2		$	-		$	11
Asset retirement obligation change in estimated future cash outflows		-			(10	)		-			12
Property, plant and equipment accruals		4			68			(33	)		(62	)
Capitalized long-term incentives		5			2			12			(7	)
Property additions/dispositions (swaps)		18			212			24			229
Contingent consideration (See Note 7)		-			-			6			-

21. Commitments and Contingencies

Commitments

The following table outlines the Company’s commitments as at September 30, 2021:

	Expected Future Payments
(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Transportation and Processing	$	181	$	745	$	689	$	493	$	429	$	2,334	$	4,871
Drilling and Field Services		32		44		24		24		24		-		148
Building Leases		3		10		6		6		6		2		33
Total	$	216	$	799	$	719	$	523	$	459	$	2,336	$	5,052

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Operating leases with terms greater than one year are not included in the commitments table above. The table above includes short-term leases with contract terms less than 12 months, such as drilling rigs and field office leases, as well as non-lease operating cost components associated with building leases.

Included within transportation and processing in the table above are certain commitments associated with midstream service agreements with VMLP as described in Note 14. Divestiture transactions can reduce certain commitments disclosed above.

Contingencies

Ovintiv is involved in various legal claims and actions arising in the normal course of the Company’s operations. Although the outcome of these claims cannot be predicted with certainty, the Company does not expect these matters to have a material adverse effect on Ovintiv’s financial position, cash flows or results of operations. Management’s assessment of these matters may change in the future as certain of these matters are in early stages or are subject to a number of uncertainties. For material matters that the Company believes an unfavorable outcome is reasonably possible, the Company discloses the nature and a range of potential exposures. If an unfavorable outcome were to occur, there exists the possibility of a material impact on the Company’s consolidated net earnings or loss for the period in which the effect becomes reasonably estimable. The Company accrues for such items when a liability is both probable and the amount can be reasonably estimated. Such accruals are based on the Company’s information known about the matters, estimates of the outcomes of such matters and experience in handling similar matters.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The MD&A is intended to provide a narrative description of the Company’s business from management’s perspective. This MD&A should be read in conjunction with the unaudited interim Condensed Consolidated Financial Statements and accompanying notes for the period ended September 30, 2021 (“Consolidated Financial Statements”), which are included in Part I, Item 1 of this Quarterly Report on Form 10-Q and the audited Consolidated Financial Statements and accompanying notes and MD&A for the year ended December 31, 2020, which are included in Items 8 and 7, respectively, of the 2020 Annual Report on Form 10‑K.

Common industry terms and abbreviations are used throughout this MD&A and are defined in the Definitions, Conversions and Conventions sections of this Quarterly Report on Form 10-Q. This MD&A includes the following sections:

• Executive Overview

• Results of Operations

• Liquidity and Capital Resources

• Non-GAAP Measures

Executive Overview

Strategy

Ovintiv is a leading North American energy producer that is focused on developing its multi-basin portfolio of oil, NGLs and natural gas producing plays. Ovintiv is committed to growing long-term shareholder value by delivering on its strategic priorities and pursuing the key business objectives of preserving financial strength, maintaining disciplined capital allocation and maximizing profitability through execution excellence, commercial acumen, and risk management, while driving environmental, social and governance progress.

In support of the Company’s commitment to growing shareholder value, Ovintiv announced a capital allocation framework that outlines increasing returns to shareholders as well as continuing the Company’s progress on debt reduction.

Ovintiv is delivering results in a socially and environmentally responsible manner. Thoughtfully developed best practices are deployed across its assets, allowing the Company to capitalize on operational efficiencies and decrease emissions intensity. The Company’s sustainability reporting, which outlines its key metrics and progress achieved relating to ESG practices can be found on the Company’s website.

In executing its strategy, Ovintiv focuses on its core values of One, Agile, Innovative and Driven, which guide the organization to be flexible, responsive and determined. The Company is committed to excellence with a passion to drive corporate financial performance and succeed as a team.

Ovintiv continually reviews and evaluates its strategy and changing market conditions in order to maximize cash flow generation from its top tier assets located in some of the best plays in North America, referred to as the “Core Assets”. As at September 30, 2021, the Core Assets comprised Permian and Anadarko in the U.S., and Montney in Canada. These Core Assets form a multi-basin portfolio of oil, NGLs and natural gas producing plays enabling flexible and efficient investment of capital that support the Company’s strategy.

For additional information on Ovintiv’s strategy, its reporting segments and the plays in which the Company operates, refer to Items 1 and 2 of the 2020 Annual Report on Form 10-K.

In evaluating its operations and assessing its leverage, Ovintiv reviews performance-based measures such as Non‑GAAP Cash Flow, Non-GAAP Cash Flow Margin, Total Costs and debt-based metrics such as Debt to Adjusted Capitalization, Net Debt and Net Debt to Adjusted EBITDA, which are non-GAAP measures and do not have any standardized meaning under U.S. GAAP. These measures may not be similar to measures presented by other issuers and should not be viewed as a substitute for measures reported under U.S. GAAP. Additional information regarding these measures, including reconciliations to the closest GAAP measure, can be found in the Non-GAAP Measures section of this MD&A.

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Highlights

During the first nine months of 2021, the Company focused on executing its 2021 capital plan aimed at maximizing profitability through operational and capital efficiencies, delivering cash from operating activities and using excess cash flows to reduce total long-term debt. Higher upstream product revenues in the first nine months of 2021 compared to 2020 resulted from higher average realized prices, excluding the impact of risk management activities. Increases in average realized liquids and natural gas prices of 91 percent and 88 percent, respectively, were primarily due to higher benchmark prices. Ovintiv continues to focus on optimizing realized prices from the diversification of the Company’s downstream markets.

The Company continued to deliver significant cash from operating activities while reducing its total long-term debt balance. Cash from operating activities of $2,389 million included a net realized loss of $725 million on settlement of risk management positions and a current income tax recovery of $156 million primarily due to the resolution of certain tax items relating to prior taxation years. The Company used excess cash flows to reduce its total long-term debt balance by $2,094 million in the first nine months of 2021.

Significant Developments

• On April 28, 2021, the Company closed the sale of its previously announced Duvernay assets and received proceeds of approximately $238 million, after closing and other adjustments. The transaction had an effective date of January 1, 2021.

• On May 19, 2021, the Company closed the sale of its previously announced Eagle Ford assets and received proceeds of approximately $762 million, after closing and other adjustments. The transaction had an effective date of January 1, 2021.

• On May 19, 2021, the Company announced its intention to redeem the Company’s $600 million, 5.75 percent senior notes due January 30, 2022, and its $518 million, 3.90 percent senior notes due November 15, 2021. The senior notes were redeemed on June 18, 2021 and August 16, 2021, respectively. The combined debt redemptions are expected to result in annualized interest savings of over $50 million.

• On July 27, 2021, Ovintiv announced an increase of about 50 percent to its quarterly dividend payment representing an annualized dividend of $0.56 per share of common stock as part of the Company’s commitment to returning capital to shareholders.

• On September 9, 2021, Ovintiv announced a new capital allocation framework to support the Company’s strategy of increasing shareholder returns as well as reducing Net Debt.

• On September 28, 2021, Ovintiv announced it received regulatory approval to commence a NCIB that enables the Company to purchase, for cancellation, up to approximately 26 million shares of common stock over a 12-month period from October 1, 2021 to September 30, 2022. The number of shares authorized for purchase represents approximately 10 percent of Ovintiv’s issued and outstanding shares of common stock as at September 20, 2021. The Company plans to fund the NCIB through its new capital allocation framework.

• On October 6, 2021, Ovintiv launched its sustainability website, which highlights the Company’s progress on ESG metrics and initiatives, and announced several sustainability milestones related to emission reductions, social responsibility, and corporate governance. The Company announced it expects to achieve a 33 percent reduction in methane emissions intensity in 2021, four years ahead of schedule, and set a target to reduce Ovintiv’s GHG emissions intensity by greater than 20 percent compared to 2019 levels by the end of 2021.

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Financial Results

Three months ended September 30, 2021

• Reported net loss of $72 million, including net losses on risk management in revenues of $950 million, before tax.

• Generated cash from operating activities of $812 million, Non-GAAP Cash Flow of $845 million and Non‑GAAP Cash Flow Margin of $17.17 per BOE.

• Paid dividends of $0.14 per share of common stock totaling $37 million.

• Reduced total long-term debt by $523 million.

Nine months ended September 30, 2021

• Reported net earnings of $32 million, including net losses on risk management in revenues of $2,176 million, before tax and a current income tax recovery of $156 million.

• Generated cash from operating activities of $2,389 million, Non-GAAP Cash Flow of $2,468 million and Non‑GAAP Cash Flow Margin of $16.66 per BOE.

• Paid dividends of $0.3275 per share of common stock totaling $86 million.

• Had $4.3 billion in total liquidity as at September 30, 2021, which included available credit facilities of $4.0 billion, available uncommitted demand lines of $278 million, and cash and cash equivalents of $8 million.

• Reduced total long-term debt by $2,094 million.

• Reported Net Debt to Adjusted EBITDA of 1.5 times.

Capital Investment

• Continued to execute the Company’s 2021 capital plan with expenditures totaling $1,098 million of which $1,012 million, or 92 percent, was directed to the Core Assets.

• Focused on highly efficient capital activity and short-cycle high margin and/or low-cost projects providing flexibility to respond to fluctuations in commodity prices.

Production

Three months ended September 30, 2021

• Produced average liquids volumes of 273.6 Mbbls/d, which accounted for 51 percent of total production volumes. Average oil and plant condensate volumes of 188.7 Mbbls/d, represented 69 percent of total liquids production volumes.

• Produced average natural gas volumes of 1,566 MMcf/d, which accounted for 49 percent of total production volumes.

Nine months ended September 30, 2021

• Produced average liquids volumes of 278.7 Mbbls/d, which accounted for 51 percent of total production volumes. Average oil and plant condensate volumes of 195.8 Mbbls/d, represented 70 percent of total liquids production volumes.

• Produced average natural gas volumes of 1,583 MMcf/d, which accounted for 49 percent of total production volumes.

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Operating Expenses

• Incurred Total Costs in the first nine months of 2021 of $1,918 million, or $12.97 per BOE, an increase of $178 million and an increase of $1.20 per BOE compared to the first nine months of 2020. Total Costs is defined in the Non-GAAP Measures section of this MD&A. Significant items in the first nine months of 2021 compared to 2020 impacting Total Costs include:

o Higher upstream transportation and processing expenses of $105 million, primarily due to higher production volumes in Montney and a higher U.S./Canadian dollar exchange rate;

o Higher production, mineral and other taxes of $84 million, primarily due to higher commodity prices; and

o Lower upstream operating expenses, excluding long-term incentive costs, of $16 million primarily due to durable cost savings including workforce reductions in 2020.

• Total Operating Expenses in the first nine months of 2021 of $5,245 million decreased by $4,120 million, primarily due to the non-cash ceiling test impairment of $4,863 million recognized in the first nine months of 2020.

Additional information on Total Costs items and Total Operating Expenses above can be found in the Results of Operations section of this MD&A.

2021 Outlook

Industry Outlook

Oil Markets

The oil and gas industry is cyclical and commodity prices are inherently volatile. Oil prices reflect global supply and demand dynamics as well as the geopolitical and macroeconomic environment.

Oil prices during 2021 will continue to be impacted by the global containment of the coronavirus (“COVID-19”), pace of economic recovery, OPEC+ production levels, and the potential for higher U.S. production.  The distribution of COVID-19 vaccines continues to drive optimism and oil demand as countries reopen their economies. Upward pressures on oil prices and the tightening of global oil inventories during the first nine months of 2021 were mainly caused by OPEC+ production cuts and increasing global demand for oil.

In July, OPEC+ announced monthly production increases starting from August until December 2021, and in October, reconfirmed production adjustments for November. OPEC+ plans to assess market developments in December and continues to meet regularly to review the state of global oil supply, demand and inventory levels.

Oil markets are expected to remain volatile as economic recovery centers on the COVID-19 vaccine rollouts and OPEC+ production cuts. COVID-19 variants may threaten the reopening of economies in certain countries while the gradual easing of OPEC+ oil production cuts, the potential for higher U.S. oil production, and macroeconomic risks could contribute to commodity market uncertainty.

Natural Gas Markets

Natural gas prices are primarily affected by structural changes in supply and demand as well as deviations from seasonally normal weather. In combination, these factors contributed to increased drawdowns of natural gas inventory and generally supported natural gas prices in the first nine months of 2021. Limited supply growth from U.S. producers combined with supportive weather conditions has contributed to a significant increase in natural gas prices during the third quarter of 2021. Natural gas prices for the remainder of 2021 are expected to be impacted by the interplay between gas production and associated gas from oil production, as well as changes in demand from the power generation sector, changes in export levels of liquified natural gas and impacts from seasonal weather.

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Company Outlook

The Company continues to exercise discretion and discipline to optimize capital allocation throughout 2021 as oil demand recovers and the commodity price environment evolves. Ovintiv pursues innovative ways to reduce upstream operating and administrative expenses and expects to benefit from durable cost savings and efficiencies to maximize cash flows.

Markets for crude oil and natural gas are exposed to different price risks and are inherently volatile. While the market price for crude oil tends to move in the same direction as the global market, regional differentials may develop. Natural gas prices may vary between geographic regions depending on local supply and demand conditions. To mitigate price volatility and help sustain revenues, particularly during periods of low commodity prices, the Company enters into derivative financial instruments. As at September 30, 2021, the Company has hedged approximately 130.0 Mbbls/d of expected crude oil and condensate production and 1,145 MMcf/d of expected natural gas production for the remainder of the year. In addition, Ovintiv proactively utilizes transportation contracts to diversify the Company’s sales markets, thereby reducing significant exposure to any given market and regional pricing.

Additional information on Ovintiv’s hedging program can be found in Note 19 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Capital Investment

The Company is on track to meet its $1.5 billion 2021 capital investment program, the majority of which is allocated to the Core Assets with a focus on maximizing returns from high margin liquids to optimize cash flows. During the first nine months of 2021, the Company invested $1,098 million, of which $475 million was directed to Permian, $289 million was directed to Montney, $248 million was directed to Anadarko and the remainder was primarily directed to other upstream assets. Ovintiv will continue to evaluate its capital investment plans as the global economic environment evolves.

Ovintiv continually strives to improve well performance and lower costs through innovative techniques. Initiatives such as applying Simul-Frac techniques, a process of fracking pairs of wells at the same time instead of a single well, increases operational efficiencies and contributes to well cost savings. Ovintiv's large-scale cube development model utilizes multi-well pads and advanced completion designs to maximize returns and resource recovery from its reservoirs. The impact of Ovintiv’s disciplined capital program and continuous innovation create flexibility to allocate capital in changing commodity markets and to maximize cash flows while preserving the long-term value of the Company’s multi-basin portfolio.

Production

Ovintiv is strategically positioned in the current environment to maintain a flat liquids production profile while generating significant cash flows in excess of capital expenditures. During the first nine months 2021, average liquids production volumes were 278.7 Mbbls/d, or 51 percent of total production volumes, and average oil and plant condensate production volumes were 195.8 Mbbls/d, or 70 percent of total liquids production volumes. Average natural gas production volumes were 1,583 MMcf/d, or 49 percent of total production volumes. During the second quarter of 2021, the Company updated its full year 2021 guidance for oil and plant condensate production volumes to approximately 190.0 Mbbls/d to 195.0 Mbbls/d, other NGLs production volumes to approximately 80.0 Mbbls/d to 85.0 Mbbls/d and natural gas production volumes to approximately 1,550 MMcf/d to 1,575 MMcf/d. The updated guidance reflects the divestitures completed in the second quarter of 2021. During the third quarter of 2021, the Company narrowed its updated guidance range for oil and plant condensate production volumes to approximately 191.0 Mbbs/d to 194.0 Mbbs/d, other NGLs production volumes to approximately 82.0 Mbbls/d to 83.0 Mbbls/d and natural gas production volumes to approximately 1,555 MMcf/d to 1,570 MMcf/d. The Company expects to meet or exceed all of its production targets.

Operating Expenses

The Company will continue to benefit from cost savings measures implemented in 2020 which included workforce reductions and operating efficiencies. Ovintiv continues to pursue innovative ways to reduce upstream operating and administrative expenses. With rising activity in the oil and gas industry and the recovery of commodity prices, service and supply costs are expected to increase. The Company strives to minimize any inflationary pressures with efficiency improvements and effective supply chain management.

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In the second quarter of 2021, Ovintiv revised its expectation of Total Costs to approximately $12.95 per BOE to $13.20 per BOE to reflect higher than expected changes in foreign exchange rates and increased production taxes resulting from higher than expected commodity prices. Total Costs were $12.97 per BOE in the first nine months of 2021 and are expected to remain well within the guidance range. Total Costs is defined in the Non-GAAP Measures section of this MD&A.

Long-term Debt Reduction

Ovintiv remains focused on strengthening its balance sheet. Since the second quarter of 2020, the Company has allocated $2,575 million in excess cash flows to reduce its total long-term debt balance, which included proceeds from the Duvernay and Eagle Ford asset divestitures. The Company is targeting a Net Debt balance of approximately $3.0 billion by the end of 2023.

In June 2021, the Company redeemed its $600 million, 5.75 percent senior notes due January 30, 2022, and in August 2021, redeemed its $518 million, 3.90 percent senior notes due November 15, 2021. The combined debt redemptions are expected to result in annualized interest savings of over $50 million.

As at September 30, 2021, the Company had no outstanding balances under its revolving credit facilities and U.S. dollar commercial paper programs.

Additional information on Ovintiv’s long-term debt and liquidity position can be found in Note 10 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q and the Liquidity and Capital Resources section of this MD&A, respectively.

Additional information on Ovintiv’s 2021 Corporate Guidance can be accessed on the Company’s website at www.ovintiv.com.

Environmental, Social and Governance

Ovintiv recognizes the importance of reducing its environmental footprint and voluntarily participates in emission reduction programs. The Company has adopted a range of strategies to help reduce emissions from its operations. These strategies include incorporating new and proven technologies and optimized processes in its drilling and completions operations, and working closely with third-party providers to develop best practices. The Company continues to look for innovative techniques and efficiencies to help maintain its commitment to emission reductions.  

By the end of 2021, the Company is expected to deliver on its targeted 33 percent reduction in methane emissions intensity four years ahead of schedule and expects to achieve a greater than 20 percent reduction in GHG emissions intensity compared to 2019 levels. In 2022, the Company plans to set further GHG emissions reduction targets, which will be tied to its annual compensation program for all employees.

As of September 1, 2021, the Company is in full alignment with the World Bank Zero Routine Flaring initiative, which requires participants to end routine flaring by 2030. Ovintiv does not engage in routine flaring by ensuring natural gas gathering infrastructure is in place for all of its producing wells.

Ovintiv maintains a commitment on protecting the health and safety of its workforce. Despite the challenges presented by COVID-19, the Company reported its seventh consecutive safest year in 2020 and is on track to report its eighth consecutive safest year for 2021.

Ovintiv is committed to diversity, equity and inclusion. In 2021, the Company developed a new social commitment framework, which is rooted in the Company’s foundational values of Trust, Respect, Integrity, Safety and Sustainability. The framework focuses on respecting stakeholders, strengthening communities and fostering a culture of inclusion.

Additional information on Ovintiv’s ESG practices can be found on the Company’s sustainability website at https://sustainability.ovintiv.com.

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Results of Operations

Selected Financial Information

	Three months ended September 30,							Nine months ended September 30,
($ millions)		2021			2020				2021			2020
Product and Service Revenues
Upstream product revenues		$	1,948		$	980			$	5,265		$	2,804
Market optimization			771			346				2,171			1,113
Service revenues (1)			1			-				4			2
Total Product and Service Revenues			2,720			1,326				7,440			3,919
Gains (Losses) on Risk Management, Net			(950	)		(154	)			(2,176	)		587
Sublease Revenues			19			18				55			53
Total Revenues			1,789			1,190				5,319			4,559
Total Operating Expenses (2)			1,789			2,696				5,245			9,365
Operating Income (Loss)			-			(1,506	)			74			(4,806	)
Total Other (Income) Expenses			71			54				217			282
Net Earnings (Loss) Before Income Tax			(71	)		(1,560	)			(143	)		(5,088	)
Income Tax Expense (Recovery)			1			(39	)			(175	)		395
Net Earnings (Loss)		$	(72	)	$	(1,521	)		$	32		$	(5,483	)

(1) Service revenues include amounts related to the USA and Canadian Operations.

(2) Total Operating Expenses include non-cash items such as DD&A, impairments, accretion of asset retirement obligations and long-term incentive costs.

Revenues

Ovintiv’s revenues are substantially derived from sales of oil, NGLs and natural gas production. Increases or decreases in Ovintiv’s revenue, profitability and future production are highly dependent on the commodity prices the Company receives. Prices are market driven and fluctuate due to factors beyond the Company’s control, such as supply and demand, seasonality and geopolitical and economic factors. The USA Operations realized prices generally reflect WTI and NYMEX benchmark prices, as well as other downstream oil benchmarks, including Houston. The Canadian Operations realized prices are linked to Edmonton Condensate and AECO, as well as other downstream natural gas benchmarks, including Dawn. The other downstream benchmarks reflect the diversification of the Company’s markets. Recent trends in benchmark prices relevant to the Company are shown in the table below.

Benchmark Prices

	Three months ended September 30,				Nine months ended September 30,
(average for the period)	2021		2020		2021		2020
Oil & NGLs
WTI ($/bbl)	$	70.56	$	40.93	$	64.82	$	38.32
Houston ($/bbl)		71.01		41.89		65.80		40.27
Edmonton Condensate (C$/bbl)		87.26		50.00		80.75		47.48
Natural Gas
NYMEX ($/MMBtu)	$	4.01	$	1.98	$	3.18	$	1.88
AECO (C$/Mcf)		3.54		2.15		3.11		2.07
Dawn (C$/MMBtu)		5.13		2.42		4.18		2.35

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Production Volumes and Realized Prices

	Three months ended September 30,										Nine months ended September 30,
	Production Volumes (1)					Realized Prices (2)					Production Volumes (1)						Realized Prices (2)
	2021		2020				2021		2020		2021			2020				2021		2020
Oil (Mbbls/d, $/bbl)
USA Operations		136.7		138.5			$	68.69	$	39.41		143.5			148.7			$	62.82	$	35.51
Canadian Operations		0.1		0.4				64.95		34.38		0.4			0.6				55.51		29.79
Total		136.8		138.9				68.69		39.40		143.9			149.3				62.80		35.49
NGLs – Plant Condensate (Mbbls/d, $/bbl)
USA Operations		11.3		11.4				62.84		27.98		10.5			11.1				56.84		25.05
Canadian Operations		40.6		35.8				68.78		36.71		41.4			39.4				63.62		33.69
Total		51.9		47.2				67.49		34.60		51.9			50.5				62.25		31.79
NGLs – Other (Mbbls/d, $/bbl)
USA Operations		69.4		70.2				28.77		10.47		66.6			71.7				23.29		8.52
Canadian Operations		15.5		13.6				31.73		13.16		16.3			14.5				27.38		9.68
Total		84.9		83.8				29.31		10.91		82.9			86.2				24.09		8.72
Total Oil & NGLs (Mbbls/d, $/bbl)
USA Operations		217.4		220.1				55.63		29.59		220.6			231.5				50.59		26.66
Canadian Operations		56.2		49.8				58.57		30.27		58.1			54.5				53.41		27.24
Total		273.6		269.9				56.23		29.72		278.7			286.0				51.18		26.77
Natural Gas (MMcf/d, $/Mcf)
USA Operations		495		507				3.80		1.52		484			537				3.13		1.42
Canadian Operations		1,071		935				3.63		1.96		1,099			983				3.18		1.83
Total		1,566		1,442				3.69		1.81		1,583			1,520				3.17		1.69
Total Production (MBOE/d, $/BOE)
USA Operations		300.0		304.6				46.59		23.91		301.2			320.9				42.08		21.60
Canadian Operations		234.7		205.6				30.61		16.22		241.3			218.4				27.38		15.05
Total		534.7		510.2				39.57		20.81		542.5			539.3				35.54		18.94
Production Mix (%)
Oil & Plant Condensate		35		37								36			37
NGLs – Other		16		16								15			16
Total Oil & NGLs		51		53								51			53
Natural Gas		49		47								49			47
Production Change
Year Over Year (%) (3)
Total Oil & NGLs		1		(18	)							(3	)		(3	)
Natural Gas		9		(13	)							4			(3	)
Total Production		5		(16	)							1			(3	)
Core Assets Production
Oil (Mbbls/d)		112.2		99.4								109.9			106.2
NGLs – Plant Condensate (Mbbls/d)		50.8		41.5								49.5			44.5
NGLs – Other (Mbbls/d)		78.8		75.0								75.6			76.8
Total Oil & NGLs (Mbbls/d)		241.8		215.9								235.0			227.5
Natural Gas (MMcf/d)		1,487		1,291								1,473			1,362
Total Production (MBOE/d)		489.6		431.1								480.5			454.6
% of Total Production		92		84								89			84

(1) Average daily.

(2) Average per-unit prices, excluding the impact of risk management activities.

(3) Includes production impacts from acquisitions and divestitures.

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Upstream Product Revenues

	Three months ended September 30,
($ millions)	Oil			NGLs - Plant Condensate		NGLs - Other			Natural Gas		Total
2020 Upstream Product Revenues (1)	$	503		$	151	$	84		$	241	$	979
Increase (decrease) due to:
Sales prices		369			155		144			268		936
Production volumes		(7	)		16		2			21		32
2021 Upstream Product Revenues	$	865		$	322	$	230		$	530	$	1,947
	Nine months ended September 30,
($ millions)	Oil			NGLs - Plant Condensate		NGLs - Other			Natural Gas		Total
2020 Upstream Product Revenues (1)	$	1,452		$	441	$	205		$	705	$	2,803
Increase (decrease) due to:
Sales prices		1,072			428		348			631		2,479
Production volumes		(57	)		12		(8	)		32		(21	)
2021 Upstream Product Revenues	$	2,467		$	881	$	545		$	1,368	$	5,261

(1) Revenues for the third quarter and first nine months of 2021 exclude certain other revenue and royalty adjustments with no associated production volumes of $1 million and $4 million, respectively (2020 - $1 million and $1 million, respectively).

Oil Revenues

Three months ended September 30, 2021 versus September 30, 2020

Oil revenues increased $362 million compared to the third quarter of 2020 primarily due to:

• Higher average realized oil prices of $29.29 per bbl, or 74 percent, increased revenues by $369 million. The increase reflected higher WTI and Houston benchmark prices which were up 72 percent and 70 percent, respectively, and the strengthening of regional pricing relative to the WTI benchmark price in the USA Operations; and

• Lower average oil production volumes of 2.1 Mbbls/d decreased revenues by $7 million. Lower volumes were primarily due to the sale of the Eagle Ford assets in the second quarter of 2021 (13.7 Mbbls/d), partially offset by successful drilling in Permian (11.4 Mbbls/d).

Nine months ended September 30, 2021 versus September 30, 2020

Oil revenues increased $1,015 million compared to the first nine months of 2020 primarily due to:

• Higher average realized oil prices of $27.31 per bbl, or 77 percent, increased revenues by $1,072 million. The increase reflected higher WTI and Houston benchmark prices which were up 69 percent and 63 percent, respectively, and the strengthening of regional pricing relative to the WTI benchmark price in the USA Operations; and

• Lower average oil production volumes of 5.4 Mbbls/d decreased revenues by $57 million. Lower volumes were primarily due to natural declines surpassing incremental production in Anadarko, Eagle Ford and Bakken (8.9 Mbbls/d) and the sale of the Eagle Ford assets in the second quarter of 2021 (6.8 Mbbls/d), partially offset by successful drilling in Permian (7.6 Mbbls/d) and production shut-ins due to the economic downturn in 2020 (3.6 Mbbls/d).

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NGL Revenues

Three months ended September 30, 2021 versus September 30, 2020

NGL revenues increased $317 million compared to the third quarter of 2020 primarily due to:

• Higher average realized plant condensate prices of $32.89 per bbl, or 95 percent, increased revenues by $155 million. The increase reflected higher Edmonton Condensate and WTI benchmark prices which were up 75 percent and 72 percent, respectively, as well as higher regional pricing relative to the WTI benchmark price;

• Higher average realized other NGL prices of $18.40 per bbl, or 169 percent, increased revenues by $144 million reflecting higher other NGL benchmark prices and higher regional pricing; and

• Higher average plant condensate production volumes of 4.7 Mbbls/d increased revenues by $16 million. Higher volumes were primarily due to successful drilling in Montney (7.7 Mbbls/d), partially offset by the sales of the Duvernay and Eagle Ford assets in the second quarter of 2021 (3.5 Mbbls/d).

Nine months ended September 30, 2021 versus September 30, 2020

NGL revenues increased $780 million compared to the first nine months of 2020 primarily due to:

• Higher average realized plant condensate prices of $30.46 per bbl, or 96 percent, increased revenues by $428 million. The increase reflected higher Edmonton Condensate and WTI benchmark prices which were up 70 percent and 69 percent, respectively, as well as higher regional pricing relative to the WTI benchmark price;

• Higher average realized other NGL prices of $15.37 per bbl, or 176 percent, increased revenues by $348 million reflecting higher other NGL benchmark prices and higher regional pricing;

• Higher average plant condensate production volumes of 1.4 Mbbls/d increased revenues by $12 million. Higher volumes were primarily due to successful drilling in Montney (4.4 Mbbls/d), partially offset by natural declines in Duvernay (1.9 Mbbls/d), and the sales of the Duvernay and Eagle Ford assets in the second quarter of 2021 (1.9 Mbbls/d); and

• Lower average other NGL production volumes of 3.3 Mbbls/d decreased revenues by $8 million. Lower volumes were primarily due to natural declines in Anadarko (5.2 Mbbls/d) and the sale of the Eagle Ford assets in the second quarter of 2021 (1.8 Mbbls/d), partially offset by successful drilling in Montney and Permian (4.2 Mbbls/d).

Natural Gas Revenues

Three months ended September 30, 2021 versus September 30, 2020

Natural gas revenues increased $289 million compared to the third quarter of 2020 primarily due to:

• Higher average realized natural gas prices of $1.88 per Mcf, or 104 percent, increased revenues by $268 million. The increase reflected higher Dawn, NYMEX and AECO benchmark prices which were up 112 percent, 103 percent and 65 percent, respectively, and higher regional pricing; and

• Higher average natural gas production volumes of 124 MMcf/d increased revenues by $21 million primarily due to successful drilling in Montney (155 MMcf/d) and decreased third-party plant down-time in Montney (36 MMcf/d), partially offset by the sales of the Duvernay and Eagle Ford assets in the second quarter of 2021 (56 MMcf/d).

Nine months ended September 30, 2021 versus September 30, 2020

Natural gas revenues increased $663 million compared to the first nine months of 2020 primarily due to:

• Higher average realized natural gas prices of $1.48 per Mcf, or 88 percent, increased revenues by $631 million. The increase reflected higher Dawn, NYMEX and AECO benchmark prices which were up 78 percent, 69 percent and 50 percent, respectively, and higher regional pricing; and

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• Higher average natural gas production volumes of 63 MMcf/d increased revenues by $32 million primarily due to successful drilling in Montney (154 MMcf/d) and production shut-ins due to the economic downturn in 2020 (11 MMcf/d), partially offset by natural declines in Anadarko and Duvernay (58 MMcf/d) and the sales of the Duvernay and Eagle Ford assets in the second quarter of 2021 (30 MMcf/d).

Gains (Losses) on Risk Management, Net

As a means of managing commodity price volatility, Ovintiv enters into commodity derivative financial instruments on a portion of its expected oil, NGL and natural gas production volumes. The Company’s commodity price mitigation program reduces volatility and helps sustain revenues during periods of lower prices. Additional information on the Company’s commodity price positions as at September 30, 2021 can be found in Note 19 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

The following tables provide the effects of the Company’s risk management activities on revenues.

	Three months ended September 30,						Nine months ended September 30,
($ millions)	2021			2020			2021			2020
Realized Gains (Losses) on Risk Management
Commodity Price (1)
Oil	$	(194	)	$	26		$	(478	)	$	331
NGLs - Plant Condensate		(39	)		23			(99	)		105
NGLs - Other		(42	)		(7	)		(81	)		5
Natural Gas		(97	)		45			(96	)		157
Other (2)		1			2			4			7
Total		(371	)		89			(750	)		605
Unrealized Gains (Losses) on Risk Management		(579	)		(243	)		(1,426	)		(18	)
Total Gains (Losses) on Risk Management, Net	$	(950	)	$	(154	)	$	(2,176	)	$	587
	Three months ended September 30,						Nine months ended September 30,
(Per-unit)	2021			2020			2021			2020
Realized Gains (Losses) on Risk Management
Commodity Price (1)
Oil ($/bbl)	$	(15.38	)	$	1.99		$	(12.16	)	$	8.09
NGLs - Plant Condensate ($/bbl)	$	(8.15	)	$	5.39		$	(7.01	)	$	7.62
NGLs - Other ($/bbl)	$	(5.45	)	$	(0.92	)	$	(3.59	)	$	0.20
Natural Gas ($/Mcf)	$	(0.67	)	$	0.34		$	(0.22	)	$	0.38
Total ($/BOE)	$	(7.57	)	$	1.85		$	(5.09	)	$	4.04

(1) Includes realized gains and losses related to the USA and Canadian Operations.

(2) Other primarily includes realized gains or losses from Market Optimization and other derivative contracts with no associated production volumes.

Ovintiv recognizes fair value changes from its risk management activities each reporting period. The changes in fair value result from new positions and settlements that occur during each period, as well as the relationship between contract prices and the associated forward curves. Realized gains or losses on risk management activities related to commodity price mitigation are included in the USA Operations, Canadian Operations and Market Optimization revenues as the contracts are cash settled. Unrealized gains or losses on fair value changes of unsettled contracts are included in the Corporate and Other segment.

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Market Optimization Revenues

Market Optimization product revenues relate to activities that provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. Ovintiv also purchases and sells third-party volumes under marketing arrangements associated with the Company’s previous divestitures.

	Three months ended September 30,				Nine months ended September 30,
($ millions)	2021		2020		2021		2020
Market Optimization	$	771	$	346	$	2,171	$	1,113

Three months ended September 30, 2021 versus September 30, 2020

Market Optimization product revenues increased $425 million compared to the third quarter of 2020 primarily due to:

• Higher oil and natural gas benchmark prices ($350 million) and higher sales of third-party purchased liquids volumes primarily relating to price optimization activities in the USA Operations ($204 million);

partially offset by:

• Lower sales of third-party purchased natural gas volumes primarily relating to marketing arrangements for assets divested in prior years ($129 million).

Nine months ended September 30, 2021 versus September 30, 2020

Market Optimization product revenues increased $1,058 million compared to the first nine months of 2020 primarily due to:

• Higher oil and natural gas benchmark prices ($1,041 million) and higher sales of third-party purchased liquids volumes primarily relating to price optimization activities in the USA Operations ($354 million);

partially offset by:

• Lower sales of third-party purchased natural gas volumes primarily relating to marketing arrangements for assets divested in prior years ($337 million).

Sublease Revenues

Sublease revenues primarily include amounts related to the sublease of office space in The Bow office building recorded in the Corporate and Other segment. Additional information on office sublease income can be found in Note 9 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Operating Expenses

Production, Mineral and Other Taxes

Production, mineral and other taxes include production and property taxes. Production taxes are generally assessed as a percentage of oil, NGLs and natural gas production revenues. Property taxes are generally assessed based on the value of the underlying assets.

	Three months ended September 30,				Nine months ended September 30,
($ millions)	2021		2020		2021		2020
USA Operations	$	75	$	43	$	199	$	115
Canadian Operations		2		4		11		11
Total	$	77	$	47	$	210	$	126
	Three months ended September 30,				Nine months ended September 30,
($/BOE)	2021		2020		2021		2020
USA Operations	$	2.71	$	1.54	$	2.42	$	1.31
Canadian Operations	$	0.13	$	0.18	$	0.17	$	0.18
Production, Mineral and Other Taxes	$	1.57	$	0.99	$	1.42	$	0.85

Three months ended September 30, 2021 versus September 30, 2020

Production, mineral and other taxes increased $30 million compared to the third quarter of 2020 primarily due to:

• Higher production tax in USA Operations due to higher commodity prices ($38 million), partially offset by the sale of the Eagle Ford assets in the second quarter of 2021 ($7 million).

Nine months ended September 30, 2021 versus September 30, 2020

Production, mineral and other taxes increased $84 million compared to the first nine months of 2020 primarily due to:

• Higher production tax in USA Operations due to higher commodity prices ($99 million), partially offset by the sale of the Eagle Ford assets in the second quarter of 2021 ($10 million).

Transportation and Processing

Transportation and processing expense includes transportation costs incurred to move product from production points to sales points including gathering, compression, pipeline tariffs, trucking and storage costs. Ovintiv also incurs costs related to processing provided by third parties or through ownership interests in processing facilities.

	Three months ended September 30,				Nine months ended September 30,
($ millions)	2021		2020		2021		2020
USA Operations	$	122	$	109	$	361	$	345
Canadian Operations		231		203		703		614
Upstream Transportation and Processing		353		312		1,064		959
Market Optimization		44		53		130		170
Total	$	397	$	365	$	1,194	$	1,129
	Three months ended September 30,				Nine months ended September 30,
($/BOE)	2021		2020		2021		2020
USA Operations	$	4.43	$	3.85	$	4.40	$	3.92
Canadian Operations	$	10.68	$	10.71	$	10.68	$	10.24
Upstream Transportation and Processing	$	7.17	$	6.62	$	7.19	$	6.48

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Three months ended September 30, 2021 versus September 30, 2020

Transportation and processing expense increased $32 million compared to the third quarter of 2020 primarily due to:

• Higher volumes in Montney ($29 million), higher variable rates in Permian due to higher natural gas prices ($13 million), a higher U.S./Canadian dollar exchange rate ($11 million), and higher costs relating to the diversification of the Company’s downstream markets ($6 million);

partially offset by:

• The sales of the Eagle Ford and Duvernay assets in the second quarter of 2021 ($14 million), expired contracts relating to previously divested assets ($9 million) and the decommissioning of Deep Panuke ($8 million).

Nine months ended September 30, 2021 versus September 30, 2020

Transportation and processing expense increased $65 million compared to the first nine months of 2020 primarily due to:

• Higher volumes in Montney ($78 million), a higher U.S./Canadian dollar exchange rate ($49 million), higher variable rates in Permian and Anadarko due to higher natural gas prices ($31 million) and higher costs relating to the diversification of the Company’s downstream markets ($11 million);

partially offset by:

• The expiration of certain transportation contracts in the USA Operations as well as expired contracts relating to previously divested assets ($41 million), the sales of the Eagle Ford and Duvernay assets in the second quarter of 2021 ($27 million), the decommissioning of Deep Panuke ($23 million), lower natural gas volumes in Anadarko ($16 million) and recoveries of amounts related to certain transportation contracts ($8 million).

Operating

Operating expense includes costs paid by the Company, net of amounts capitalized, on oil and natural gas properties in which the Company has a working interest. These costs primarily include labor, service contract fees, chemicals, fuel, water hauling, electricity and workovers.

	Three months ended September 30,				Nine months ended September 30,
($ millions)	2021		2020		2021		2020
USA Operations	$	122	$	104	$	368	$	364
Canadian Operations		25		24		78		75
Upstream Operating Expense		147		128		446		439
Market Optimization		5		5		19		15
Corporate & Other		1		-		1		(2	)
Total	$	153	$	133	$	466	$	452
	Three months ended September 30,				Nine months ended September 30,
($/BOE)	2021		2020		2021		2020
USA Operations	$	4.38	$	3.73	$	4.47	$	4.14
Canadian Operations	$	1.20	$	1.22	$	1.17	$	1.23
Upstream Operating Expense (1)	$	2.98	$	2.72	$	3.00	$	2.96

(1) Upstream Operating Expense per BOE for the third quarter and first nine months of 2021 include long-term incentive costs of $0.13/BOE and $0.14/BOE, respectively (2020 - long-term incentive costs of $0.03/BOE and a recovery of long-term incentive costs of $0.02/BOE, respectively).

Three months ended September 30, 2021 versus September 30, 2020

Operating expense increased $20 million compared to the third quarter of 2020 primarily due to:

• Increased activity resulting from higher production in Permian and improved commodity prices ($17 million), higher long-term incentive costs resulting from an increase in the Company’s share price in the third quarter of 2021 compared to 2020 ($7 million) and lower capitalization of directly attributable internal costs ($7 million);

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partially offset by:

• The sales of the Eagle Ford and Duvernay assets in the second quarter of 2021 ($16 million).

Nine months ended September 30, 2021 versus September 30, 2020

Operating expense increased $14 million compared to the first nine months of 2020 primarily due to:

• Lower capitalization of directly attributable internal costs ($38 million), higher long-term incentive costs resulting from an increase in the Company’s share price in the first nine months of 2021 compared to a decrease in 2020 ($29 million) and increased activity resulting from higher production in Permian and improved commodity prices ($18 million);

partially offset by:

• Lower salaries and benefits due to decreased headcount resulting from workforce reductions in the second quarter of 2020 ($47 million) and the sales of the Eagle Ford and Duvernay assets in the second quarter of 2021 ($26 million).

Additional information on the Company’s long-term incentives can be found in Note 16 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Purchased Product

Purchased product expense includes purchases of oil, NGLs and natural gas from third parties that are used to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. The Company also purchases and sells third-party volumes under marketing arrangements associated with the Company’s previous divestitures.

	Three months ended September 30,					Nine months ended September 30,
($ millions)		2021		2020		2021		2020
Market Optimization		$	759	$	322	$	2,096	$	1,039

Three months ended September 30, 2021 versus September 30, 2020

Purchased product expense increased $437 million compared to the third quarter of 2020 primarily due to:

• Higher oil and natural gas benchmark prices ($349 million) and higher third-party purchased liquids volumes primarily relating to price optimization activities in the USA Operations ($206 million);

partially offset by:

• Lower third-party purchased natural gas volumes primarily relating to marketing arrangements for assets divested in prior years ($118 million).

Nine months ended September 30, 2021 versus September 30, 2020

Purchased product expense increased $1,057 million compared to the first nine months of 2020 primarily due to:

• Higher oil and natural gas benchmark prices ($1,005 million) and higher third-party purchased liquids volumes primarily relating to price optimization activities in the USA Operations ($356 million);

partially offset by:

• Lower third-party purchased natural gas volumes primarily relating to marketing arrangements for assets divested in prior years ($304 million).

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Depreciation, Depletion & Amortization

Proved properties within each country cost centre are depleted using the unit-of-production method based on proved reserves as discussed in Note 1 to the Consolidated Financial Statements included in Item 8 of the 2020 Annual Report on Form 10-K. Depletion rates are impacted by impairments, acquisitions, divestitures and foreign exchange rates, as well as fluctuations in 12-month average trailing prices which affect proved reserves volumes. Corporate assets are carried at cost and depreciated on a straight-line basis over the estimated service lives of the assets.

Additional information can be found under Upstream Assets and Reserve Estimates in the Critical Accounting Estimates section of the MD&A included in Item 7 of the 2020 Annual Report on Form 10-K.

	Three months ended September 30,				Nine months ended September 30,
($ millions)	2021		2020		2021		2020
USA Operations	$	207	$	299	$	635	$	1,092
Canadian Operations		83		99		265		319
Upstream DD&A		290		398		900		1,411
Corporate & Other		7		8		16		22
Total	$	297	$	406	$	916	$	1,433
	Three months ended September 30,				Nine months ended September 30,
($/BOE)	2021		2020		2021		2020
USA Operations	$	7.52	$	10.66	$	7.73	$	12.42
Canadian Operations	$	3.82	$	5.23	$	4.02	$	5.31
Upstream DD&A	$	5.90	$	8.47	$	6.08	$	9.54

Three months ended September 30, 2021 versus September 30, 2020

DD&A decreased $109 million compared to the third quarter of 2020 primarily due to:

• Lower depletion rates in the USA and Canadian Operations ($87 million and $37 million, respectively) and lower production volumes in USA Operations ($5 million), partially offset by higher production volumes in the Canadian Operations ($14 million) and a higher U.S./Canadian dollar exchange rate ($6 million).

The depletion rate in the USA Operations decreased $3.14 per BOE compared to the third quarter of 2020 primarily due to the ceiling test impairments recognized in 2020 and the sale of the Eagle Ford assets in the second quarter of 2021. The depletion rate in the Canadian Operations decreased $1.41 per BOE compared to the third quarter of 2020 primarily due to a lower depletable base and the sale of the Duvernay assets in the second quarter of 2021.

Nine months ended September 30, 2021 versus September 30, 2020

DD&A decreased $517 million compared to the first nine months of 2020 primarily due to:

• Lower depletion rates in the USA and Canadian Operations ($386 million and $114 million, respectively) and lower production volumes in USA Operations ($71 million), partially offset by higher production volumes in the Canadian Operations ($34 million) and a higher U.S./Canadian dollar exchange rate ($29 million).

The depletion rate in the USA Operations decreased $4.69 per BOE compared to the first nine months of 2020 primarily due to the ceiling test impairments recognized in 2020 and the sale of the Eagle Ford assets in the second quarter of 2021. The depletion rate in the Canadian Operations decreased $1.29 per BOE compared to the first nine months of 2020 primarily due to a lower depletable base and the sale of the Duvernay assets in the second quarter of 2021.

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Impairments

Under full cost accounting, the carrying amount of Ovintiv’s oil and natural gas properties within each country cost centre is subject to a ceiling test performed quarterly. Ceiling test impairments are recognized when the capitalized costs, net of accumulated depletion and the related deferred income taxes, exceed the sum of the estimated after-tax future net cash flows from proved reserves as calculated under SEC requirements using the 12‑month average trailing prices and discounted at 10 percent. The 12-month average trailing price is calculated as the average of the price on the first day of each month within the trailing 12-month period.

In the third quarter and first nine months of 2021, the Company did not recognize ceiling test impairments (2020 - $1,336 million before tax, and $4,863 million before tax, respectively, in the USA Operations). The non-cash ceiling test impairments in 2020 primarily resulted from the decline in the 12-month average trailing prices, which reduced proved reserves.

The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.

	Oil & NGLs				Natural Gas
	WTI ($/bbl)		Edmonton Condensate (C$/bbl)		Henry Hub ($/MMBtu)		AECO (C$/MMBtu)
12-Month Average Trailing Reserves Pricing (1)
September 30, 2021		57.69		72.45		2.94		2.79
December 31, 2020		39.62		49.77		1.98		2.13
September 30, 2020		43.69		53.93		1.97		2.01

(1) All prices were held constant in all future years when estimating net revenues and reserves.

The Company believes that the discounted after-tax future net cash flows from proved reserves required to be used in the ceiling test calculation are not indicative of the fair market value of Ovintiv’s oil and natural gas properties or the future net cash flows expected to be generated from such properties. The discounted after-tax future net cash flows do not consider the fair market value of unamortized unproved properties, or probable or possible liquids and natural gas reserves. In addition, there is no consideration given to the effect of future changes in commodity prices. Ovintiv manages its business using estimates of reserves and resources based on forecast prices and costs. Additional information on the ceiling test calculation can be found in Note 8 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Administrative

Administrative expense represents costs associated with corporate functions provided by Ovintiv staff. Costs primarily include salaries and benefits, operating lease, office, information technology, restructuring and long-term incentive costs.

	Three months ended September 30,					Nine months ended September 30,
($ millions)	2021		2020			2021			2020
Administrative, excluding Long-Term Incentive,
Restructuring and Legal Costs, and Current
Expected Credit Losses (1)	$	70	$	72		$	219		$	214
Long-term incentive costs		25		1			91			(6	)
Restructuring and legal costs		6		7			37			88
Current expected credit losses		-		(1	)		(1	)		1
Total Administrative (2)	$	101	$	79		$	346		$	297
	Three months ended September 30,					Nine months ended September 30,
($/BOE)	2021		2020			2021			2020
Administrative, excluding Long-Term Incentive,
Restructuring and Legal Costs, and Current
Expected Credit Losses (1)	$	1.44	$	1.55		$	1.50		$	1.46
Long-term incentive costs		0.51		0.02			0.61			(0.04	)
Restructuring and legal costs		0.11		0.14			0.24			0.59
Current expected credit losses		-		(0.03	)		(0.01	)		-
Total Administrative	$	2.06	$	1.68		$	2.34		$	2.01

(1) The third quarter and first nine months of 2021 include costs related to The Bow office lease of $30 million and $88 million, respectively, (2020 - $28 million and $82 million, respectively), half of which is recovered from sublease revenues.

(2) The third quarter and first nine months of 2021 reflect a higher U.S./Canadian dollar exchange rate of $3 million and $13 million, respectively.

Three months ended September 30, 2021 versus September 30, 2020

Administrative expense increased $22 million compared to the third quarter of 2020 primarily due to:

• Higher long-term incentive costs resulting from an increase in the Company’s share price in the third quarter of 2021 compared to 2020 ($24 million);

partially offset by:

• A decrease in restructuring costs related to workforce reductions in 2020 ($5 million).

Nine months ended September 30, 2021 versus September 30, 2020

Administrative expense increased $49 million compared to the first nine months of 2020 primarily due to:

• Higher long-term incentive costs resulting from an increase in the Company’s share price in the first nine months of 2021 compared to a decrease in 2020 ($97 million) and higher legal and consulting costs ($31 million);

partially offset by:

• A decrease in restructuring costs, and lower salaries and benefits related to workforce reductions in 2020 ($75 million and $9 million, respectively).

During 2020, the Company completed workforce reductions as part of a company-wide reorganization in response to the low commodity price environment resulting from the global pandemic and the Company’s planned reductions in capital spending. Additional information on restructuring charges can be found in Note 15 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Other (Income) Expenses

	Three months ended September 30,						Nine months ended September 30,
($ millions)	2021			2020			2021			2020
Interest	$	77		$	97		$	263		$	279
Foreign exchange (gain) loss, net		-			(25	)		(15	)		51
Other (gains) losses, net		(6	)		(18	)		(31	)		(48	)
Total Other (Income) Expenses	$	71		$	54		$	217		$	282

Interest

Interest expense primarily includes interest on Ovintiv’s long-term debt. Additional information on changes in interest can be found in Note 4 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Three months ended September 30, 2021 versus September 30, 2020

Interest expense decreased $20 million compared to the third quarter of 2020 primarily due to the redemption of the Company’s 2021 and 2022 senior notes ($12 million), and open market repurchases of long-term debt completed in 2020 and decreased amounts drawn from the Company’s credit facilities ($5 million).

Nine months ended September 30, 2021 versus September 30, 2020

Interest expense decreased $16 million compared to the first nine months of 2020 primarily due to open market repurchases of long-term debt completed in 2020 and decreased amounts drawn from the Company’s credit facilities ($16 million), and the redemption of the Company’s 2021 and 2022 senior notes ($14 million), partially offset by a one-time make-whole interest payment of $19 million resulting from the June 2021 early redemption of the Company’s $600 million, 5.75 percent senior notes due January 30, 2022.

Foreign Exchange (Gain) Loss, Net

Foreign exchange gains and losses primarily result from the impact of fluctuations in the Canadian to U.S. dollar exchange rate. Additional information on changes in foreign exchange gains or losses can be found in Note 5 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Following the completion of the corporate reorganization and U.S. domestication in the first quarter of 2020, the U.S. dollar denominated unsecured notes issued by Encana Corporation from Canada were assumed by Ovintiv Inc., a company incorporated in Delaware with a U.S. dollar functional currency. Accordingly, these U.S. dollar denominated unsecured notes, along with certain intercompany notes, no longer attract foreign exchange translation gains or losses.

Three months ended September 30, 2021 versus September 30, 2020

Net foreign exchange was nil compared to a gain of $25 million in the third quarter of 2020 primarily due to:

• Unrealized foreign exchange losses on the translation of U.S. dollar risk management contracts and financing debt issued from Canada compared to gains in 2020 ($29 million and $6 million, respectively);

partially offset by:

• Higher realized foreign exchange gains on the settlement of U.S. dollar risk management contracts issued from Canada compared to 2020 ($5 million).

Nine months ended September 30, 2021 versus September 30, 2020

Net foreign exchange gain was $15 million compared to a loss of $51 million in the first nine months of 2020 primarily due to:

• Lower unrealized foreign exchange losses on the translation of U.S. dollar financing debt issued from Canada ($55 million) and realized foreign exchange gains on the settlement of U.S. dollar risk management contracts and financing debt issued from Canada compared to losses in 2020 ($32 million and $24 million, respectively);

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partially offset by:

• Lower unrealized foreign exchange gains on the translation of intercompany notes ($27 million) and higher unrealized foreign exchange losses on U.S. dollar risk managements contracts issued from Canada ($18 million).

Other (Gains) Losses, Net

Other (gains) losses, net, primarily includes other non-recurring revenues or expenses and may also include items such as interest income, interest received from tax authorities, transaction costs relating to acquisitions, reclamation charges relating to decommissioned assets, gains on debt repurchases, government stimulus programs and adjustments related to other assets.

Other gains in the first nine months of 2021 includes interest income of $13 million primarily associated with the resolution of prior year tax items.

Other gains in the third quarter and first nine months of 2020 primarily included a gain of $6 million and $28 million, respectively, relating to the repurchase of the Company’s fixed long-term debt on the open market.

Income Tax

	Three months ended September 30,					Nine months ended September 30,
($ millions)	2021		2020			2021			2020
Current Income Tax Expense (Recovery)	$	-	$	3		$	(156	)	$	2
Deferred Income Tax Expense (Recovery)		1		(42	)		(19	)		393
Income Tax Expense (Recovery)	$	1	$	(39	)	$	(175	)	$	395
Effective Tax Rate	(1.4%)		2.5%			122.4%			(7.8%)

Income Tax Expense (Recovery)

Three months ended September 30, 2021 versus September 30, 2020

In the third quarter of 2021, Ovintiv recorded an income tax expense of $1 million compared to an income tax recovery of $39 million in 2020, primarily due to the change in valuation allowances.

Nine months ended September 30, 2021 versus September 30, 2020

In the first nine months of 2021, Ovintiv recorded an income tax recovery of $175 million compared to an income tax expense of $395 million in 2020, primarily due to the resolution of certain tax items relating to prior taxation years and the change in valuation allowances.

Effective Tax Rate

Ovintiv’s interim income tax expense is determined using the estimated annual effective income tax rate applied to year‑to‑date net earnings before income tax plus the effect of legislative changes and amounts in respect of prior periods. The estimated annual effective income tax rate is impacted by expected annual earnings, changes in valuation allowances, state taxes, income tax related to foreign operations, the effect of legislative changes, non-taxable capital gains and losses, and tax differences on divestitures and transactions, which can produce interim effective tax rate fluctuations.

The Company’s effective tax rate was (1.4) percent for the third quarter of 2021, which is lower than the U.S. federal statutory tax rate of 21 percent primarily due to the change in valuation allowances recorded relating to the current year net loss before tax.

The Company’s effective tax rate was 122.4 percent for the first nine months of 2021, which is higher than the U.S. federal statutory tax rate of 21 percent primarily due to the resolution of certain tax items relating to prior taxation years and the change in valuation allowances recorded relating to the current year net loss before tax.

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The Company’s effective tax rate was 2.5 percent for the third quarter and (7.8) percent for the first nine months of 2020, which were lower than the U.S. statutory tax rate of 21 percent primarily due to valuation allowances recorded due to net losses arising from ceiling test impairments, and an increase in the valuation allowance of $568 million in Canada related to prior year’s deferred tax assets, which was recorded as a discrete item.

The determination of income and other tax liabilities of the Company and its subsidiaries requires interpretation of complex domestic and foreign tax laws and regulations, that are subject to change. The Company’s interpretation of taxation laws may differ from the interpretation of the tax authorities. As a result, there are tax matters under review for which the timing of resolution is uncertain. The Company believes that the provision for income taxes is adequate.

Liquidity and Capital Resources

Sources of Liquidity

The Company has the flexibility to access cash equivalents and a range of funding alternatives at competitive rates through committed revolving credit facilities as well as debt and equity capital markets. Ovintiv closely monitors the accessibility of cost-effective credit and ensures that sufficient liquidity is in place to fund capital expenditures and dividend payments. In addition, the Company may use cash and cash equivalents, cash from operating activities, or proceeds from asset divestitures to fund its operations or to manage its capital structure as discussed below.

The Company’s capital structure consists of total shareholders’ equity plus long-term debt, including any current portion. The Company’s objectives when managing its capital structure are to maintain financial flexibility to preserve Ovintiv’s access to capital markets and its ability to meet financial obligations and execute its strategy. Ovintiv has a practice of maintaining capital discipline and strategically managing its capital structure by adjusting capital spending, adjusting dividends paid to shareholders, issuing new shares of common stock, purchasing shares of common stock for cancellation, issuing new debt and repaying or repurchasing existing debt.

	As at September 30,
($ millions, except as indicated)	2021		2020
Cash and Cash Equivalents	$	8	$	32
Available Credit Facilities (1)		4,000		2,990
Available Uncommitted Demand Lines (2)		278		186
Issuance of U.S. Commercial Paper		-		(140	)
Total Liquidity	$	4,286	$	3,068
Long-Term Debt, including current portion	$	4,791	$	7,142
Total Shareholders’ Equity	$	3,797	$	4,352
Debt to Capitalization (%) (3)		56		62
Debt to Adjusted Capitalization (%) (4)		29		37

(1) Includes available credit facilities of $2.5 billion (2020 - $1.77 billion) in the U.S. and $1.5 billion (2020 - $1.22 billion) in Canada as at September 30, 2021 (collectively, the “Credit Facilities”).

(2) Includes three uncommitted demand lines totaling $335 million, net of $57 million in related undrawn letters of credit (2020 - $325 million and $139 million, respectively).

(3) Calculated as long-term debt, including the current portion, divided by shareholders’ equity plus long-term debt, including the current portion.

(4) A non-GAAP measure which is defined in the Non-GAAP Measures section of this MD&A.

The Company has access to two committed revolving U.S. dollar denominated credit facilities totaling $4.0 billion, which include a $2.5 billion revolving credit facility for Ovintiv Inc. and a $1.5 billion revolving credit facility for a Canadian subsidiary, both maturing in July 2024. The Credit Facilities provide financial flexibility and allow the Company to fund its operations or capital program. At September 30, 2021, there were no outstanding amounts under the revolving credit facility for Ovintiv Inc. and for the Canadian subsidiary.

Ovintiv currently has both investment and non-investment grade credit ratings and has full access to its Credit Facilities and U.S. commercial paper (“U.S. CP”) programs.

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Depending on the Company’s credit rating and market demand, the Company may issue from its two U.S. CP programs, which include a $1.5 billion program for Ovintiv Inc. and a $1.0 billion program for a Canadian subsidiary. As at September 30, 2021, the Company had no commercial paper outstanding under its U.S. CP programs.

The Credit Facilities, uncommitted demand lines, and cash and cash equivalents provide Ovintiv with total liquidity of approximately $4.3 billion. At September 30, 2021, Ovintiv also had approximately $57 million in undrawn letters of credit issued in the normal course of business primarily as collateral security, related to transportation arrangements and to support future abandonment liabilities.

Ovintiv has a U.S. shelf registration statement and a Canadian shelf prospectus, under which the Company may issue from time to time, debt securities, common stock, preferred stock, warrants, units, share purchase contracts and share purchase units in the U.S. and/or Canada. At September 30, 2021, $6.0 billion remained accessible under the Canadian shelf prospectus. The ability to issue securities under the U.S. shelf registration statement or Canadian shelf prospectus is dependent upon market conditions and securities law requirements.

Ovintiv is currently in compliance with, and expects that it will continue to be in compliance with, all financial covenants under the Credit Facilities. Management monitors Debt to Adjusted Capitalization, which is a non-GAAP measure defined in the Non-GAAP Measures section of this MD&A, as a proxy for Ovintiv’s financial covenant under the Credit Facilities, which requires Debt to Adjusted Capitalization to be less than 60 percent. As at September 30, 2021, the Company’s Debt to Adjusted Capitalization was 29 percent. The definitions used in the covenant under the Credit Facilities adjust capitalization for cumulative historical ceiling test impairments recorded in conjunction with the Company’s January 1, 2012 adoption of U.S. GAAP. Ovintiv does not expect the current COVID-19 pandemic to impact the Company’s ability to remain in compliance with its financial covenants under the Credit Facilities. Additional information on financial covenants can be found in Note 15 to the Consolidated Financial Statements included in Item 8 of the 2020 Annual Report on Form 10‑K.

Sources and Uses of Cash

In the third quarter and first nine months of 2021, Ovintiv primarily generated cash through operating activities and divestitures. The following table summarizes the sources and uses of the Company’s cash and cash equivalents.

		Three months ended September 30,						Nine months ended September 30,
($ millions)	Activity Type	2021			2020			2021			2020
Sources of Cash, Cash Equivalents and Restricted Cash
Cash from operating activities	Operating	$	812		$	493		$	2,389		$	1,176
Proceeds from divestitures	Investing		(8	)		39			1,017			69
Net issuance of revolving long-term debt	Financing		-			-			-			452
Other	Investing		6			68			-			-
			810			600			3,406			1,697
Uses of Cash and Cash Equivalents
Capital expenditures	Investing		365			351			1,098			1,393
Acquisitions	Investing		-			1			3			19
Net repayment of revolving long-term debt	Financing		-			100			950			-
Repayment of long-term debt (1)	Financing		518			109			1,137			224
Dividends on shares of common stock	Financing		37			24			86			73
Other	Financing/Investing		2			23			134			141
			922			608			3,408			1,850
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents     and Restricted Cash Held in Foreign Currency			(2	)		1			-			(5	)
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash		$	(114	)	$	(7	)	$	(2	)	$	(158	)

(1) Includes open market repurchases in 2020.

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Operating Activities

Net cash from operating activities in the third quarter and first nine months of 2021 was $812 million and $2,389 million, respectively, and was primarily a reflection of the impacts from higher average realized commodity prices, partially offset by the effects of the commodity price mitigation program and changes in non‑cash working capital.

Additional detail on changes in non-cash working capital can be found in Note 20 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Ovintiv expects it will continue to meet the payment terms of its suppliers.

Non-GAAP Cash Flow in the third quarter and first nine months of 2021 was $845 million and $2,468 million, respectively, and was primarily impacted by the items affecting cash from operating activities which are discussed below and in the Results of Operations section of this MD&A.

Three months ended September 30, 2021 versus September 30, 2020

Net cash from operating activities increased $319 million compared to the third quarter of 2020 primarily due to:

• Higher realized commodity prices ($936 million), lower decommissioning payments primarily related to Deep Panuke ($37 million) and higher production volumes ($32 million);

partially offset by:

• Realized losses on risk management in revenues compared to gains in 2020 ($460 million), changes in non-cash working capital ($165 million), higher transportation and processing expense ($32 million), higher production, mineral and other taxes ($30 million) and higher operating expense, excluding non-cash long-term incentive costs ($13 million).

Nine months ended September 30, 2021 versus September 30, 2020

Net cash from operating activities increased $1,213 million compared to the first nine months of 2020 primarily due to:

• Higher realized commodity prices ($2,479 million), a current income tax recovery mainly due to the resolution of certain tax items relating to prior taxation years ($156 million), lower decommissioning payments primarily related to Deep Panuke ($134 million), lower administrative expenses, excluding non-cash long-term incentive costs and current expected credit losses ($38 million), lower operating expense, excluding non-cash long-term incentive costs ($15 million) and higher interest income ($9 million);

partially offset by:

• Realized losses on risk management in revenues compared to gains in 2020 ($1,355 million), changes in non-cash working capital ($164 million), higher production, mineral and other taxes ($84 million), higher transportation and processing expense ($65 million) and lower production volumes ($21 million).

Investing Activities

Cash used in investing activities in the first nine months of 2021 was $120 million primarily due to capital expenditures, partially offset by proceeds from divestitures. Capital expenditures decreased $295 million compared to the first nine months of 2020 due to the Company’s reduced capital program in response to the volatile market conditions that commenced at the end of the first quarter of 2020.

Acquisitions in the first nine months of 2021 were $3 million (2020 - $19 million), which primarily included property purchases with oil and liquids rich potential.

Divestitures in the first nine months of 2021 were $1,017 million (2020 - $69 million), which primarily included the sale of the Eagle Ford assets in south Texas and Duvernay assets in west central Alberta, totaling approximately $1.0 billion, after closing and other adjustments, as well as certain properties that did not complement Ovintiv’s existing portfolio of assets.

Capital expenditures and acquisition and divestiture activity are summarized in Notes 2 and 7 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Financing Activities

Net cash used in financing activities has been impacted by the Company’s strategy to enhance liquidity, strengthen its balance sheet by repaying or repurchasing existing debt, and returning value to shareholders by paying dividends.

Net cash used in financing activities in the first nine months of 2021 was $2,271 million compared to net cash from financing activities of $88 million in 2020. The change was primarily due to a net repayment of revolving long-term debt in 2021 of $950 million compared to a net issuance in 2020 of $452 million and higher repayment of long-term debt ($913 million) associated with the early redemption of the Company’s senior notes as discussed below.

From time to time, Ovintiv may seek to retire or purchase the Company’s outstanding debt through cash purchases and/or exchanges for other debt or equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, the Company’s liquidity requirements, contractual restrictions and other factors.

The Company’s long-term debt totaled $4,791 million at September 30, 2021. There was no current portion outstanding at September 30, 2021. The Company’s long-term debt at December 31, 2020 totaled $6,885 million, which included the current portion of $518 million. In June 2021, the Company redeemed its $600 million, 5.75 percent senior notes due January 30, 2022, and in August 2021, redeemed its $518 million, 3.90 percent senior notes due November 15, 2021. The combined debt redemptions are expected to result in annualized interest savings of over $50 million. As at September 30, 2021, the Company has no fixed rate long-term debt due until 2024 and beyond.

Since the second quarter of 2020, the Company has allocated $2,575 million in excess cash flows to reduce its total long-term debt balance, which includes proceeds from the Duvernay and Eagle Ford asset divestitures. The Company is targeting a Net Debt balance of approximately $3.0 billion by the end of 2023.

In support of the Company’s commitment to growing shareholder value, Ovintiv announced a new capital allocation framework in the third quarter that outlines increasing returns to shareholders as well as continuing the Company’s progress on debt reduction.

For additional information on long-term debt, refer to Note 10 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Dividends

Ovintiv pays quarterly dividends to common stockholders at the discretion of the Board of Directors.

	Three months ended September 30,					Nine months ended September 30,
($ millions, except as indicated)		2021		2020		2021		2020
Dividend Payments		$	37	$	24	$	86	$	73
Dividend Payments ($/share)		$	0.14	$	0.09375	$	0.3275	$	0.28125

On November 2, 2021, the Board of Directors declared a dividend of $0.14 per share of common stock payable on December 31, 2021 to common stockholders of record as of December 15, 2021.

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Normal Course Issuer Bid

On September 28, 2021, Ovintiv announced it received regulatory approval to commence a NCIB that enables the Company to purchase, for cancellation, up to approximately 26 million shares of common stock over a 12-month period from October 1, 2021 to September 30, 2022. The number of shares authorized for purchase represent approximately 10 percent of Ovintiv’s issued and outstanding shares of common stock as at September 20, 2021. The Company plans to fund the NCIB through its new capital allocation framework as discussed above.

Off-Balance Sheet Arrangements

For information on off-balance sheet arrangements and transactions, refer to the Off-Balance Sheet Arrangements section of the MD&A included in Item 7 of the 2020 Annual Report on Form 10-K.

Commitments and Contingencies

For information on commitments and contingencies, refer to Note 21 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Non-GAAP Measures

Certain measures in this document do not have any standardized meaning as prescribed by U.S. GAAP and, therefore, are considered non-GAAP measures. These measures may not be comparable to similar measures presented by other issuers and should not be viewed as a substitute for measures reported under U.S. GAAP. These measures are commonly used in the oil and gas industry and by Ovintiv to provide shareholders and potential investors with additional information regarding the Company’s liquidity and its ability to generate funds to finance its operations. Non-GAAP measures include: Non-GAAP Cash Flow, Non-GAAP Cash Flow Margin, Total Costs, Debt to Adjusted Capitalization, Net Debt and Net Debt to Adjusted EBITDA. Management’s use of these measures is discussed further below.

Non-GAAP Cash Flow and Non-GAAP Cash Flow Margin

Non-GAAP Cash Flow is a non-GAAP measure defined as cash from (used in) operating activities excluding net change in other assets and liabilities, net change in non-cash working capital and current tax on sale of assets.

Non-GAAP Cash Flow Margin is a non-GAAP measure defined as Non-GAAP Cash Flow per BOE of production.

Management believes these measures are useful to the Company and its investors as a measure of operating and financial performance across periods and against other companies in the industry, and are an indication of the Company’s ability to generate cash to finance capital programs, to service debt and to meet other financial obligations. These measures are used, along with other measures, in the calculation of certain performance targets for the Company’s management and employees.

	Three months ended September 30,						Nine months ended September 30,
($ millions, except as indicated)	2021			2020			2021			2020
Cash From (Used in) Operating Activities	$	812		$	493		$	2,389		$	1,176
(Add back) deduct:
Net change in other assets and liabilities		(10	)		(47	)		(21	)		(167	)
Net change in non-cash working capital		(23	)		142			(58	)		106
Current tax on sale of assets		-			-			-			-
Non-GAAP Cash Flow (1)	$	845		$	398		$	2,468		$	1,237
Divided by:
Production Volumes (MMBOE)		49.2			46.9			148.1			147.8
Non-GAAP Cash Flow Margin ($/BOE)	$	17.17		$	8.49		$	16.66		$	8.37

(1) The third quarter and first nine months of 2021 include restructuring costs of $2 million and $13 million, respectively (2020 - $7 million and $88 million, respectively).

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Total Costs

Total Costs is a non-GAAP measure which includes the summation of production, mineral and other taxes, upstream transportation and processing expense, upstream operating expense and administrative expense, excluding the impact of long-term incentive, restructuring and legal costs, and current expected credit losses. It is calculated as total operating expenses excluding non-upstream operating costs and non-cash items which include operating expenses from the Market Optimization and Corporate and Other segments, depreciation, depletion and amortization, impairments, accretion of asset retirement obligation, long-term incentive, restructuring and legal costs, and current expected credit losses. When presented on a per BOE basis, Total Costs is divided by production volumes. Management believes this measure is useful to the Company and its investors as a measure of operational efficiency across periods.

	Three months ended September 30,					Nine months ended September 30,
($ millions, except as indicated)	2021		2020			2021			2020
Total Operating Expenses	$	1,789	$	2,696		$	5,245		$	9,365
Deduct (add back):
Market optimization operating expenses		808		380			2,245			1,224
Corporate & other operating expenses		1		-			1			(2	)
Depreciation, depletion and amortization		297		406			916			1,433
Impairments		-		1,336			-			4,863
Accretion of asset retirement obligation		5		8			17			26
Long-term incentive costs		31		2			112			(8	)
Restructuring and legal costs		6		7			37			88
Current expected credit losses		-		(1	)		(1	)		1
Total Costs	$	641	$	558		$	1,918		$	1,740
Divided by:
Production Volumes (MMBOE)		49.2		46.9			148.1			147.8
Total Costs ($/BOE) (1)	$	13.03	$	11.85		$	12.97		$	11.77

(1) Calculated using whole dollars and volumes.

Debt to Adjusted Capitalization

Debt to Adjusted Capitalization is a non-GAAP measure which adjusts capitalization for historical ceiling test impairments that were recorded as at December 31, 2011. Management monitors Debt to Adjusted Capitalization as a proxy for the Company’s financial covenant under the Credit Facilities which require debt to adjusted capitalization to be less than 60 percent. Adjusted Capitalization includes debt, total shareholders’ equity and an equity adjustment for cumulative historical ceiling test impairments recorded as at December 31, 2011 in conjunction with the Company’s January 1, 2012 adoption of U.S. GAAP.

($ millions, except as indicated)	September 30, 2021		December 31, 2020
Long-Term Debt, including current portion	$	4,791	$	6,885
Total Shareholders’ Equity		3,797		3,837
Equity Adjustment for Impairments at December 31, 2011		7,746		7,746
Adjusted Capitalization	$	16,334	$	18,468
Debt to Adjusted Capitalization	29%		37%

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Net Debt and Net Debt to Adjusted EBITDA

Net Debt and Net Debt to Adjusted EBITDA are non-GAAP measures whereby Net Debt is defined as long-term debt, including the current portion, less cash and cash equivalents and Adjusted EBITDA is defined as trailing 12-month net earnings (loss) before income taxes, depreciation, depletion and amortization, impairments, accretion of asset retirement obligation, interest, unrealized gains/losses on risk management, foreign exchange gains/losses, gains/losses on divestitures and other gains/losses.

Management believes this measure is useful to the Company and its investors as a measure of financial leverage and the Company’s ability to service its debt and other financial obligations. This measure is used, along with other measures, in the calculation of certain financial performance targets for the Company’s management and employees.

($ millions, except as indicated)	September 30, 2021			December 31, 2020
Long-Term Debt, including current portion	$	4,791		$	6,885
Less:
Cash and cash equivalents		8			10
Net Debt		4,783			6,875
Net Earnings (Loss)		(582	)		(6,097	)
Add back (deduct):
Depreciation, depletion and amortization		1,317			1,834
Impairments		717			5,580
Accretion of asset retirement obligation		20			29
Interest		355			371
Unrealized (gains) losses on risk management		1,612			204
Foreign exchange (gain) loss, net		(49	)		17
(Gain) loss on divestitures, net		-			-
Other (gains) losses, net		(38	)		(55	)
Income tax expense (recovery)		(203	)		367
Adjusted EBITDA (trailing 12-month)	$	3,149		$	2,250
Net Debt to Adjusted EBITDA (times)		1.5			3.1

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Item 3: Quantitative and Qualitative Disclosures About Market Risk

The primary objective of the following information is to provide forward-looking quantitative and qualitative information about Ovintiv’s potential exposure to market risks. The term “market risk” refers to the Company’s risk of loss arising from adverse changes in oil, NGL and natural gas prices, foreign currency exchange rates and interest rates. The following disclosures are not meant to be precise indicators of expected future losses but rather indicators of reasonably possible losses. The forward-looking information provides indicators of how the Company views and manages ongoing market risk exposures.

COMMODITY PRICE RISK

Commodity price risk arises from the effect fluctuations in future commodity prices, including oil, NGLs and natural gas, may have on future revenues, expenses and cash flows. Realized pricing is primarily driven by the prevailing worldwide price for crude oil and spot market prices applicable to the Company’s natural gas production. Pricing for oil, NGLs and natural gas production is volatile and unpredictable as discussed in Part 1, Item 2 of this Quarterly Report on Form 10-Q in the Executive Overview section in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Item 1A. “Risk Factors” of the 2020 Annual Report on Form 10-K. To partially mitigate exposure to commodity price risk, the Company may enter into various derivative financial instruments including futures, forwards, swaps, options and costless collars. The use of these derivative instruments is governed under formal policies and is subject to limits established by the Board of Directors and may vary from time to time. Both exchange traded and over-the-counter traded derivative instruments may be subject to margin-deposit requirements, and the Company may be required from time to time to deposit cash or provide letters of credit with exchange brokers or counterparties to satisfy these margin requirements. For additional information relating to the Company’s derivative and financial instruments, see Note 19 under Part I, Item 1 of this Quarterly Report on Form 10-Q.

The table below summarizes the sensitivity of the fair value of the Company’s risk management positions to fluctuations in commodity prices, with all other variables held constant. The Company has used a 10 percent variability to assess the potential impact of commodity price changes. Fluctuations in commodity prices could have resulted in unrealized gains (losses) impacting pre-tax net earnings as follows:

	September 30, 2021
(US$ millions)	10% Price Increase			10% Price Decrease
Crude oil price	$	(241	)	$	221
NGL price		(12	)		12
Natural gas price		(260	)		256

FOREIGN EXCHANGE RISK

Foreign exchange risk arises from changes in foreign exchange rates that may affect the fair value or future cash flows of the Company’s financial assets or liabilities. As Ovintiv operates primarily in the United States and Canada, fluctuations in the exchange rate between the U.S. and Canadian dollars can have a significant effect on the Company’s reported results.

The table below summarizes selected foreign exchange impacts on Ovintiv’s financial results when compared to the same periods in 2020.

	Three Months Ended September 30,				Nine Months Ended September 30,
	$ millions		$/BOE		$ millions		$/BOE
Increase (Decrease) in:
Capital Investment	$	5			$	19
Transportation and Processing Expense (1)		11	$	0.22		49	$	0.33
Operating Expense (1)		1		0.03		6		0.04
Administrative Expense		3		0.06		13		0.09
Depreciation, Depletion and Amortization (1)		6		0.12		27		0.18

(1) Reflects upstream operations.

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Foreign exchange gains and losses also arise when monetary assets and monetary liabilities denominated in foreign currencies are translated and settled, and primarily include:

• U.S. dollar denominated financing debt issued from Canada

• U.S. dollar denominated risk management assets and liabilities held in Canada

• U.S. dollar denominated cash and short-term investments held in Canada

• Foreign denominated intercompany loans

To partially mitigate the effect of foreign exchange fluctuations on future commodity revenues and expenses, the Company may enter into foreign currency derivative contracts. As at September 30, 2021, Ovintiv has entered into $88 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.3720 to US$1, which mature monthly through the remainder of 2021 and $100 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.2820 to US$1, which mature monthly throughout 2022.

As at September 30, 2021, Ovintiv did not have any U.S. dollar denominated long-term debt or finance lease obligations issued from Canada that were subject to foreign exchange exposure.

The table below summarizes the sensitivity to foreign exchange rate fluctuations, with all other variables held constant. The Company has used a 10 percent variability to assess the potential impact from Canadian to U.S. foreign currency exchange rate changes. Fluctuations in foreign currency exchange rates could have resulted in unrealized gains (losses) impacting pre-tax net earnings as follows:

	September 30, 2021
(US$ millions)	10% Rate Increase			10% Rate Decrease
Foreign currency exchange	$	(83	)	$	102

INTEREST RATE RISK

Interest rate risk arises from changes in market interest rates that may affect the fair value or future cash flows from the Company’s financial assets or liabilities. The Company may partially mitigate its exposure to interest rate changes by holding a mix of both fixed and floating rate debt and may also enter into interest rate derivatives to partially mitigate effects of fluctuations in market interest rates.

As at September 30, 2021, the Company had no floating rate debt and there were no interest rate derivatives outstanding.

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Item 4: Controls and Procedures

DISCLOSURE CONTROLS AND PROCEDURES

Ovintiv’s Chief Executive Officer and Chief Financial Officer performed an evaluation of the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”). The Company’s disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in reports it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and to ensure that the information required to be disclosed by the Company in reports that it files or submits under the Exchange Act, is accumulated and communicated to the Company’s management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2021.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in Ovintiv’s internal control over financial reporting during the third quarter of 2021 that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

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PART II

Item 1. Legal Proceedings

Please refer to Item 3 of the 2020 Annual Report on Form 10-K and Note 21 of Ovintiv’s Condensed Consolidated Financial Statements under Part I, Item 1 of this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors

There have been no material changes from the risk factors disclosed in Item 1A. Risk Factors in the 2020 Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

a) On November 1, 2021, Ovintiv entered into that certain Change in Control Agreement (effective August 1, 2021) with Brendan M. McCracken, President and Chief Executive Officer.  A copy of the Change in Control Agreement is attached as an exhibit hereto and incorporated herein by reference.

b) On November 1, 2021, Ovintiv entered into an amendment to Section 4 of the previously filed Change in Control Agreement with each of the following executives:

i. Corey D. Code, Executive Vice President and Chief Financial Officer

ii. Gregory D. Givens, Executive Vice President and Chief Operating Officer

iii. Joanne L. Cox, Executive Vice President, General Counsel and Corporate Secretary

iv. Rachel M. Moore, Executive Vice President, Corporate Services

v. Renee E. Zemljak, Executive Vice President, Midstream, Marketing and Fundamentals

Each amendment, among other things, modifies the calculation of the lump sum bonus payment entitled to each executive, as applicable, following a change in control event at the Corporation. Copies of each amendment are attached as exhibits hereto and incorporated herein by reference.

Item 6. Exhibits

Exhibit No	Description
10.1*	Change in Control Agreement between Ovintiv Inc. and Brendan M. McCracken effective August 1, 2021.
10.2*	First Amendment to Change in Control Agreement between Ovintiv Inc. and Corey D. Code effective November 1, 2021.
10.3*	First Amendment to Change in Control Agreement between Ovintiv Inc. and Gregory D. Givens effective November 1, 2021.
10.4*	First Amendment to Change in Control Agreement between Ovintiv Inc. and Joanne L. Cox effective November 1, 2021.
10.5*	First Amendment to Change in Control Agreement between Ovintiv Inc. and Rachel M. Moore effective November 1, 2021.
10.6*	First Amendment to Change in Control Agreement between Ovintiv Inc. and Renee E. Zemljak effective November 1, 2021.
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

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101.SCH	Inline XBRL Taxonomy Schema Document.
101.CAL	Inline XBRL Calculation Linkbase Document.
101.DEF	Inline XBRL Definition Linkbase Document.
101.LAB	Inline XBRL Label Linkbase Document.
101.PRE	Inline XBRL Presentation Linkbase Document.
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021, has been formatted in Inline XBRL.

* Management contract or compensatory arrangement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Ovintiv Inc.
By:	/s/ Corey D. Code
	Name:	Corey D. Code
	Title:	Executive Vice-President & Chief Financial Officer

Dated: November 4, 2021

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EX-10.1

Exhibit 10.1

CHANGE IN CONTROL AGREEMENT

This Change in Control Agreement (this “Agreement”) is made effective as of August 1, 2021 between Ovintiv Inc., a corporation incorporated under the laws of the State of Delaware (the “Corporation”), and Brendan McCracken of the City of Denver in the State of Colorado (the “Executive”).

AND WHEREAS the Board of Directors of the Corporation (the “Board”) has determined that it is in the best interests of the Corporation and its shareholders to assure that the Corporation will have the continued dedication of the Executive, notwithstanding the possibility or threat of a Change in Control (as defined herein);

AND WHEREAS the Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and dedication to the Corporation in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control that ensure that the compensation and benefits expectations of the Executive will be satisfied and that provide the Executive with compensation and benefits arrangements that are competitive with those of other companies;

AND WHEREAS to accomplish these objectives, the Board has caused the Corporation to enter into this Agreement.

NOW THEREFORE, in consideration of the covenants and agreements hereinafter set forth and for other good and valuable consideration (the receipt and sufficiency whereof are hereby acknowledged by each of the Executive and the Corporation (each, a “Party” and collectively, the “Parties”), the Parties hereby mutually covenant and agree as follows:

1.0 Term of Agreement

1.1 Term. This Agreement shall commence on the date hereof and shall continue in effect during the Executive’s employment with the Corporation as an executive officer until such time as there shall occur a Change in Control of the Corporation and for a period of two years following the Effective Date (as defined below) of such Change in Control (the “Term”); provided, however, that the payment of compensation and benefits to the Executive under this Agreement may continue beyond the end of the Term in accordance with the applicable provisions of this Agreement.

2.0 Definitions

For purposes of this Agreement, the following definitions shall apply:

2.1 “Affiliate”: means any corporation, partnership or other entity in which the Corporation, directly or indirectly, has a majority ownership interest or which controls, or is under common control with, the Corporation.

2.2 “Cause” means:

(a) the willful and continued failure by the Executive to substantially perform his or her duties with the Corporation or an Affiliate after a written demand for substantial performance is

delivered to the Executive by the Board, which demand specifically identifies the manner in which the Board believes the Executive has not substantially performed his or her duties, and the Executive fails to correct such failure to perform his or her duties within thirty (30) days after such written demand is delivered to the Executive; provided, however, that if such failure occurs after the occurrence of an event or circumstance which would entitle the Executive to resign for Good Reason, such alleged failure shall not constitute the basis for “Cause”; or

(b) the willful engaging by the Executive in conduct which is demonstrably and materially injurious to the Corporation or an Affiliate, monetarily or otherwise.

For purposes of this Section 2.2, (i) any action by the Executive or any failure on the Executive’s part to act, shall be deemed “willful” only when done (or omitted to be done) by the Executive not in good faith and only if, when done (or omitted to be done), the Executive had or ought to have had the reasonable belief that the Executive’s action or omission would not be in the best interests of the Corporation or an Affiliate, and (ii) if the Corporation is not the ultimate parent corporation of the group that includes the Corporation and all of its Affiliates after a Change in Control, references to the “Board” shall mean the board of directors (or equivalent governing body) of the ultimate parent entity of such group.

Notwithstanding the foregoing, the Executive shall not be deemed to have been terminated for Cause unless and until (A) the Executive has been provided with the opportunity, after reasonable advance notice, to appear before the Board, together with the Executive’s legal counsel, prior to a determination by the Board regarding the existence of “Cause”, and (B) there shall have been delivered to the Executive a copy of a resolution duly adopted by a vote of at least two-thirds (2/3) of the members of the Board, finding that in the good faith opinion of the Board, the Executive was guilty of conduct set forth in clause (a) or (b) of this Section 2.2 and specifying the particulars thereof. A determination of “Cause” made by the Board that is challenged by the Executive in a court of competent jurisdiction shall be subject to “de novo” standard of review by such court.

2.3 “Change in Control” means:

(a) any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity, or any persons acting jointly or in concert with the foregoing (each, a “Person”), is or becomes the beneficial owner directly or indirectly of 30% or more of either (A) the then-outstanding shares of common stock of the Corporation (the “Outstanding Corporation Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); provided, however, that, for purposes of this Section 2.3(a), the following acquisitions of shares or other voting securities of the Corporation shall not constitute a Change in Control: (i) any acquisition directly from the Corporation, (ii) any acquisition made by the Corporation, (iii) any acquisition by any employee plan (or related trust) sponsored or maintained by the Corporation or any of its subsidiaries, or (iv) any acquisition pursuant to a transaction that complies with Sections 2.3(b)(1), 2.3(b)(2) and 2.3(b)(3);

(b) consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the Corporation or any of its subsidiaries, a sale or other

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disposition of all or substantially all of the assets of the Corporation, or the acquisition of assets or securities of another entity by the Corporation or any of its subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Corporation Common Stock and the Outstanding Corporation Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Corporation Common Stock and the Outstanding Corporation Voting Securities, as the case may be, (2) no Person (excluding any entity resulting from such Business Combination or any employee plan (or related trust) of the Corporation or of such entity resulting from such Business Combination) beneficially owns, directly or indirectly, 30% or more of, respectively, the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that such ownership existed prior to the Business Combination, and (3) at least a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of the entity resulting from such Business Combination were members of the Incumbent Board (as defined below) at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination;

(c) individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Corporation's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual was a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person or entity other than the Board; or

(d) approval by the shareholders of the Corporation of a complete liquidation or dissolution of the Corporation.

For purposes of this Section 2.3:

(i) the term “acting jointly or in concert” shall be interpreted in accordance with Section 159 of the Securities Act (Alberta), as amended; and

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(ii) the term “beneficial ownership” shall be interpreted in accordance with Sections 5 and 6 of the Securities Act (Alberta) and “beneficial owner” shall have a corresponding meaning, except that for purposes of this Agreement, options and convertible securities granted by the Corporation to employees, officers or directors shall not be included in determining the percentage of beneficial ownership of any Person.

2.4 “Effective Date” means the date of the occurrence of a Change in Control.

2.5 “Good Reason” means the occurrence of any of the following on or after a Change in Control, unless the Executive shall have given express written consent thereto:

(a) Changed Status, Position, Authorities, Duties or Responsibilities. The occurrence of any of the following:

(i) any adverse change to the Executive’s status or position as in effect immediately prior to the Change in Control, including, without limitation, the Executive ceasing to serve as the sole chief executive officer of a publicly traded company, reporting directly and exclusively to the board of directors of a publicly traded company; and

(ii) assignment to the Executive of any authorities, duties or responsibilities materially inconsistent with the Executive’s position and status as of immediately prior to the Change in Control; and

(iii) any diminution in the Executive’s authorities, duties or responsibilities from those in effect immediately prior to the Change in Control; or

(b) Reduced Salary. A reduction by the Corporation in the Executive’s annual base salary as in effect immediately prior to the Change in Control; or

(c) Relocation. The Corporation requiring the Executive to be based more than 50 miles from where the Executive is based immediately prior to the Change in Control, except for: (i) required travel on the Corporation’s business to an extent substantially consistent with the Executive’s business travel obligations in the ordinary course of business immediately prior to the Change in Control; or (ii) if the Executive has been relocated or repatriated by the Corporation prior to the Change in Control, such relocation as may be required by applicable law or performed in accordance with an agreement (whether written or unwritten) entered into between the Corporation (or an Affiliate) and the Executive prior to the Change in Control; or

(d) Incentive Compensation Plans. The occurrence of any of the following: (i) a material reduction by the Corporation in the Executive’s (A) annual incentive compensation target or maximum opportunity, or (B) long-term incentive compensation target or maximum opportunity (measured based on grant date fair value of any equity-based awards), in each case, as in effect immediately prior to the Change in Control, or (ii) a change in the performance conditions, vesting, or other material terms and conditions applicable to annual and/or long-term incentive compensation awards granted to Executive after the Change in Control which would have the effect of materially reducing the Executive’s aggregate

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potential incentive compensation from the level in effect immediately prior to the Change in Control; or

(e) Pension Plan, Benefit Plans and Perquisites. The failure by the Corporation to continue to provide the Executive:

(i) with pension and other retirement benefits substantially similar to those provided to the Executive under the applicable pension and retirement plans and arrangements of the Corporation as of immediately prior to the Change in Control; or

(ii) with benefits substantially similar to the benefits provided to the Executive as of immediately prior to the Change in Control under the Corporation’s life insurance, medical, health and accident, disability or investment plans; or

(iii) with executive perquisites substantially similar to the material perquisites provided to the Executive by the Corporation as of immediately prior to the Change in Control; or

(iv) with the number of paid vacation days to which the Executive is entitled in accordance with the normal vacation policy of the Corporation in effect in respect of the Executive as of immediately prior to the Change in Control; or

(f) Deferred Compensation. The failure by the Corporation to pay the Executive (i) any portion of the Executive’s then current compensation, except pursuant to an across-the-board compensation deferral similarly affecting all senior executives of the Corporation and required by applicable law or (ii) any installment of deferred compensation at the time such installment is due under any deferred compensation program of the Corporation; or

(g) No Assumption by Successor. The failure of the Corporation to obtain a satisfactory agreement from a successor to assume and agree to perform this Agreement as contemplated by Section 7.1 hereof.

3.0 Notice of Termination; Date of Termination

3.1 Notice of Termination. Any termination of the Executive’s employment either by the Executive for Good Reason or by the Corporation for Cause or without Cause, as applicable, shall be communicated by written Notice of Termination to the Executive or to the Corporation, as the case may be, in accordance with Section 8.0 hereof.

3.2 Content of Notice of Termination. The “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon by the Executive or the Corporation, as the case may be, and shall set forth in reasonable detail the facts and circumstances claimed as the basis for the Executive terminating the Executive’s employment or the Corporation terminating the Executive’s employment, as the case may be. The Executive’s failure to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of “Good Reason” shall not result in a waiver of the Executive’s rights hereunder or preclude the Executive from subsequently asserting such fact or circumstance in enforcing the Executive’s rights hereunder.

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3.3 Date of Termination.The “Date of Termination” shall mean (a) if the Executive’s employment is terminated by the Corporation without Cause or by the Executive for Good Reason, the date specified in the Notice of Termination (which, in the case of termination by the Executive for Good Reason, shall be not more than sixty (60) days following the date such Notice of Termination is given), or (b) if the Executive’s employment is terminated by the Corporation for Cause, the date on which the Board resolution referenced in Section 2.2 is delivered to the Executive.

3.4 Notice Required. For the purposes of this Agreement, any purported termination of the Executive’s employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Section 3.2 hereof shall not be effective.

4.0 Compensation and Benefits following Change in Control

Upon the termination of the Executive’s employment by the Corporation without Cause or by the Executive for Good Reason, in accordance with the terms of this Agreement, in each case, on or after the Effective Date and prior to the end of the Term, the Corporation shall cause to be provided to the Executive, the following payments and benefits:

(a) Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Severance Payment, Severance Period and Severance Salary Rate. The Corporation shall pay to the Executive, on account of both compensation in lieu of notice and loss of office, on the Payment Date, in cash, in a lump sum, on the Payment Date, a severance payment (the “Severance Payment”) equal to the amount of base salary the Executive would have earned had he continued to be employed until the end of the twenty-fourth (24^th) full calendar month following the Date of Termination (the “Severance Period”) assuming that the Executive’s rate of monthly base salary during the Severance Period would be equal to the highest monthly rate of base salary which was payable to the Executive by the Corporation or an Affiliate during the twenty-four (24)-month period immediately preceding the Date of

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Termination (disregarding any reduction thereto that constitutes Good Reason) (the “Severance Salary Rate”).

(c) Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s target bonus as of the Date of Termination or (ii) two times the average of the annual bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

(d) Retirement and Investment Plans. The Corporation shall pay the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the maximum contribution that the Corporation or a subsidiary thereof would have been required to make on behalf of the Executive to the Corporation’s retirement or investment plans in which the Executive participates as of immediately prior to the Effective Date (other than any amount covered by Section 4.0(e)) if the Executive had remained fully employed during the Severance Period and elected to have the Corporation or a subsidiary thereof match the Executive’s contributions to such plans, determined as if the Executive continued to make contributions to such plans at a rate equal to the contributions actually made by the Executive under such plans in the last complete calendar year immediately preceding the Date of Termination.

(e) PensionBenefits.TheCorporationshallpaytotheExecutivethemaximumcontributionthat the Corporation or a subsidiary thereof would have been required to make on behalf of the Executive under the U.S. Retirement Plan at the percentage of salary specified therein in respect to the Severance Period basedon:

(i) The Executive’s annual base salary (using the Severance Salary Rate) if he was fully employed until the end of the 24^th calendar month following the Date of Termination; and

(ii) The lesser of the Applicable Bonus and 67% of the amount of the annual base salary (using the Severance Salary Rate) the Executive would have earned had he continued to be employed until the end of the 24^th calendar month following the Date of Termination.

This payment will be made to the Executive in a lump sum on the Payment Date.

(f) Equity Awards. Each outstanding equity and equity-based compensation award granted by the Corporation to the Executive shall be treated in accordance with the terms of the plan and award agreement under which it was originally granted.

(g) Insurance Benefits. The Corporation shall continue to provide the Executive with the same level of life, disability, accident, dental and health insurance benefits the Executive was receiving or entitled to receive from the Corporation immediately prior to the Date of Termination until the end of the Severance Period. The contributions or premiums required to be paid by the Executive under such programs shall be payable by the Executive to the

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Corporation or to the insurer, as applicable, on the same basis as if the Executive continued to be employed during the Severance Period.

(h) Career Counselling. At the Executive’s request, the Corporation shall provide the Executive with career counselling services, at a maximum cost to the Corporation of $15,000 per annum, until the Executive obtains subsequent employment or establishes the Executive’s own business activity or the end of the Severance Period, whichever is earliest. The Executive shall be entitled to obtain such services from the recognized professional career counselling firm of the Executive’s choice in the major metropolitan area in or nearest to where the Executive resides at the time the Executive begins to use such services.

(i) Annual Allowance. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date an amount equal to two times the annual allowance to which the Executive is entitled as of the date of the Date of Termination (or, if higher, as of immediately prior to the Effective Date).

(j) Financial Counselling. The Corporation shall, during the Severance Period, continue to provide the Executive with the same financial counselling benefits as those to which the Executive was entitled as of immediately prior to the Date of Termination (or, if more favorable to the Executive, as of immediately prior to the Effective Date). Such services shall be provided throughout the Severance Period, including the preparation of the Executive’s tax return(s) for the tax year during which the Severance Period ends.

(k) Executive Medical. The Corporation shall continue to provide the Executive with the same executive physical examination benefits as those to which the Executive was entitled as of immediately prior to the Date of Termination (or, if more favorable to the Executive, as of immediately prior to the Effective Date). Such benefits shall be provided for the duration of the Severance Period.

(l) Professional Membership Fees. The Corporation shall pay the Executive, in cash, in a lump sum, on the Payment Date, an after-tax amount equal to two times the amount reimbursed or paid by the Corporation (separate from the annual allowance) in respect of membership fees for membership in professional organizations related to the Executive’s position and duties with the Corporation for the year preceding the year in which the Date of Termination occurs (or, if greater, preceding the year in which the Effective Date occurs).

5.0 Legal Fees and Expenses

The Corporation shall pay the Executive's actual legal or professional fees and expenses incurred by the Executive in seeking to obtain or enforce any right or benefit provided by this Agreement up to US$100,000 (and, if a court or other tribunal finds in favor of the Executive, any such fees or expenses that are in excess of US$100,000). Such fees or expenses shall be reimbursed by the Corporation reasonably promptly following receipt of a copy of any invoice from the Executive evidencing the payment by the Executive of such fees or expenses. If such fees or expenses are paid in Canadian dollars, the application of the US$100,000 cap under this Section 5.0 shall be

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applied by converting the reimbursed amounts to U.S. dollars based on the spot exchange rate at the time of the reimbursement.

6.0 Entire Agreement

6.1 This Agreement, including schedules hereto, constitutes the entire agreement between the Parties hereto concerning change in control benefits and obligations and supersedes all prior agreements or understandings, including the Prior Agreement, except that each outstanding equity and equity-based compensation award granted by the Corporation to the Executive shall be treated in accordance with the terms of the plan and award agreement under which it was granted, including any such terms that relate to change in control benefits.

6.2 The Parties acknowledge and agree that this Agreement supersedes and replaces the Change in Control Agreement between Encana Corporation and the Executive dated February 14, 2018 (the “Prior Agreement”) in its entirety, which such Prior Agreement shall be of no further force and effect as of the date hereof.

7.0 Successors; Binding Agreement

7.1 Assumption by Successors. The Corporation will require any successor (whether direct or indirect, and whether by purchase, merger, consolidation or otherwise) to (a) all or substantially all of the business and/or assets of the Corporation in a transaction that constitutes a Change in Control, or (b) on or after the Effective Date and prior to the end of the Term, to the business in connection with which the Executive’s services are principally performed after a Change in Control in circumstances where the Executive’s employment is transferred to such successor, to expressly assume and to agree to perform this Agreement in the same manner and to the same extent as the Corporation, as if no such succession had taken place. Failure of the Corporation to obtain such assumption and agreement prior to the effectiveness of any such succession shall constitute Good Reason for purposes of this Agreement. As used in this Agreement, “Corporation” shall mean the Corporation as defined herein and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

7.2 Assignment; Binding Agreement.

(a) This Agreement is personal to the Executive, and, without the prior written consent of the Corporation, shall not be assignable by the Executive. This Agreement shall inure to the benefit of and be enforceable by the Executive and the Executive’s legal representatives and, and if the Executive should die while any amount remains due to the Executive under this Agreement, such amount shall be paid in accordance with the terms of this Agreement to the Executive’s legatee, if there is no such legatee, to the Executive’s estate.

(b) Except as provided in Section 7.1, without the prior written consent of the Executive, this Agreement shall not be assignable by the Corporation. This Agreement shall inure to the benefit of and be binding upon the Corporation and its successors and permitted assigns.

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8.0 Notices

8.1 Notices. For purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given (a) when hand delivered, (b) upon confirmation of receipt when sent by facsimile or email, or (c) on the third business day after having been sent by registered mail, postage prepaid, as follows:

If to the Corporation:

Ovintiv Inc.

370 17^th Street, Suite 1700

Denver, CO 80202

Attention: Executive Vice-President, Corporate Services

Facsimile: (303) 623-2400

If to the Executive:

At the Executive’s most recent address, facsimile number, or email address, as applicable, on file with the Corporation.

Each of the Corporation and the Executive may from time to time change its contact information for notice by notice to the other Party given in the manner aforesaid.

9.0 Section 409A Compliance

9.1 To the extent that Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) (together with any related regulations or other guidance promulgated by the U.S. Department of the Treasury or the Internal Revenue Service, “Section 409A”) is applicable to the Executive, this Agreement and any payment, distribution or other benefit hereunder is intended to comply with the requirements of Section 409A or an applicable exemption or exclusion therefrom, and shall be interpreted and administered in accordance with such intent in all respects; provided, that for the avoidance of doubt, this provision shall not be construed to require a gross-up payment in respect of any taxes, interest or penalties imposed on Executive as a result of Section 409A.

9.2 To the extent Section 409A is applicable to the Executive:

(a) The Executive shall not be deemed to have terminated employment for purposes of any payment or benefit under this Agreement that constitutes non-qualified deferred compensation unless and until a separation from service (within the meaning of Treasury Regulation Section 1.409A-1(h)) has occurred. If the Executive is a “specified employee” under Section 409A, no payment, distribution or other benefit provided pursuant to this Agreement constituting non-qualified deferred compensation (within the meaning of Treasury Regulation Section 1.409A-1(b)) that is required to be delayed to comply with Section 409A(a)(2)(B)(i) shall be provided before the date that is six months after the date of the Executive’s separation from service (or, if earlier than the end of such six-month period, the date of death of the specified employee). Any payment, distribution or other

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benefit that is delayed pursuant to the prior sentence shall be paid on the first business day following the six-month anniversary of the separation from service.

(b) In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement.

(c) Each payment under this Agreement shall be treated as a separate payment for purposes of Section 409A.

(d) All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A, including, where applicable, the requirement that (i) any reimbursement shall be for expenses incurred during the time period specified in this Agreement, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year, (iii) the reimbursement of an eligible expense will be made not later than the last day of the Executive’s taxable year following the taxable year in which such expense was incurred, and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit. Notwithstanding anything in this Agreement to the contrary, with respect to payment of legal fees and expenses pursuant to Section 5.0 hereof, if the court or other tribunal has not yet found in favor or against the Executive prior to the last day of the Executive’s taxable year following the taxable year in which such fees and expenses were incurred, such fees and expenses will be paid on the last day of such taxable year following the taxable year in which such fees and expenses were incurred. If such court or other tribunal does not ultimately find in favor of the Executive, the Executive will repay to the Corporation as soon as practicable, but in no event more than ninety (90) days after the court or other tribunal renders its ruling, any amounts paid or reimbursed pursuant to the prior sentence that would not have been paid or reimbursed pursuant to Section 5.0 but for the prior sentence.

10.0 Reduction of Certain Payments. This Section 10.0 shall apply to the Executive only if and to the extent that Section 4999 of the Code is applicable to the Executive.

10.1 Anything in this Agreement to the contrary notwithstanding, if the Accounting Firm (as defined below) shall determine that receipt of all Payments (as defined below) of the Executive would subject the Executive to the Excise Tax (as defined below), the Accounting Firm shall determine whether to reduce any of the Payments paid or payable pursuant to this Agreement (the “Agreement Payments”) so that the Parachute Value (as defined below) of all Payments, in the aggregate, equals the Safe Harbor Amount (as defined below). The Agreement Payments shall be so reduced only if the Accounting Firm determines that the Executive would have a greater Net After-Tax Receipt (as defined below) of aggregate Payments if the Agreement Payments were so reduced. If the Accounting Firm determines that the Executive would not have a greater Net After-Tax Receipt of aggregate Payments if the Agreement Payments were so reduced, the Executive shall receive all Agreement Payments to which the Executive is entitled hereunder.

10.2 If the Accounting Firm determines that aggregate Agreement Payments should be reduced so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount, the

Page 11

Corporation shall promptly give the Executive notice to that effect and a copy of the detailed calculation thereof.All determinations made by the Accounting Firm under this Section 10.0 shall be binding upon the Corporation, its Affiliates and the Executive.All reasonable fees and expenses of the Accounting Firm shall be borne solely by the Corporation.For purposes of reducing the Agreement Payments so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount, only amounts payable under the Agreement (and no other Payments) shall be reduced.The reduction of the amounts payable hereunder, if applicable, shall be made by reducing the Agreement Payments that have a Parachute Value in the following order:first, non-cash benefits that do not constitute non-qualified deferred compensation, second, cash benefits that constitute non-qualified deferred compensation, third, non-cash benefits that constitute non-qualified deferred compensation,and fourth, cash benefits that constitute non-qualified deferred compensation, with benefits within each category reduced in reverse chronological order beginning with those that are to be paid or provided the farthest in time from the Date of Termination, based on the Accounting Firm’s determination.

10.3 To the extent requested by the Executive, the Corporation and its Affiliates shall cooperate with the Executive in good faith in valuing, and the Accounting Firm shall take into account the value of, services provided or to be provided by the Executive (including, without limitation, the Executive’s agreeing to refrain from performing services pursuant to a covenant not to compete or similar covenant, before, on or after the date of a change in ownership or control of the Corporation (within the meaning of Q&A-2(b) of the final regulations under Section 280G of the Code)), such that payments in respect of such services may be considered reasonable compensation within the meaning of Q&A-9 and Q&A-40 to Q&A-44 of the Treasury Regulations under Section 280G of the Code and/or exempt from the definition of the term “parachute payment” within the meaning of Q&A-2(a) of the Treasury Regulations under Section 280G of the Code in accordance with Q&A-5(a) of the Treasury Regulations under Section 280G of the Code.

10.4 The following terms shall have the following meanings for purposes of this Section 9.0:

(a) “Accounting Firm” shall mean a nationally recognized certified public accounting firm or other professional organization that is a certified public accounting firm recognized as an expert in determinations and calculations for purposes of Section 280G of the Code that is selected by the Corporation prior to a Change in Control for purposes of making the applicable determinations hereunder.

(b) “Excise Tax” means any excise tax imposed under Section 4999 of the Code.

(c) “Net After-Tax Receipt” shall mean the present value (as determined in accordance with Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code) of a Payment net of all taxes imposed on the Executive with respect thereto under Sections 1 and 4999 of the Code and under applicable state and local laws, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied to the Executive’s taxable income for the immediately preceding taxable year, or such other rate(s) as the Accounting Firm determines to be likely to apply to the Executive in the relevant tax year(s).

(d) “Parachute Value” of a Payment shall mean the present value as of the date of the change in control for purposes of Section 280G of the Code of the portion of such Payment that

Page 12

constitutes a “parachute payment” under Section 280G(b)(2) of the Code, as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.

(e) “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise.

(f) “Safe Harbor Amount” shall mean the maximum Parachute Value of all Payments that the Executive can receive without any Payments being subject to the Excise Tax.

11.0 Miscellaneous

11.1 Amendment and Waiver. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in a writing signed by the Parties hereto. No waiver by either Party of, or in compliance with, any condition or provision of this Agreement to be performed by the other Party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

11.2 Deductions. The Executive agrees that benefits and payments to which the Executive is entitled pursuant to this Agreement are subject to deductions or other source withholdings as may be required by law.

11.3 No Mitigation. The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided to the Executive by the Corporation referred to in this Agreement be reduced by any compensation earned by, or benefits paid to, the Executive as the result of employment, whether by another employer or self-employment, or by pension benefits after the Date of Termination, or otherwise, except as specifically provided in this Agreement.

11.4 Governing Law. The Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules that would result in the application of the laws of another jurisdiction.

11.5 Currency. All amounts due under this Agreement shall be paid calculated and paid in the currency in which the Executive’s base salary is paid as of immediately prior to the Date of Termination.

11.6 Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

11.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same Agreement.

11.8 Headings. The division of this Agreement into sections, subsections and clauses, or other portions hereof and the insertion of headings or subheadings, are for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

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12.0 Survivorship

Upon the expiration or other termination of this Agreement or the Executive’s employment, the respective rights and obligations of the Parties shall survive to the extent necessary to carry out the intentions of the Parties under this Agreement.

Page 14

IN WITNESS WHEREOF, the Executive and the Corporation have caused this Agreement to be duly executed effective as of the date first above written.

OVINTIV INC.
Per:	/s/ Peter A. Dea
	Name: Peter A. Dea
	Title: Chairman of the Board of Directors
Per:	/s/ Rachel M. Moore
	Name: Rachel M. Moore
	Title: Executive Vice-President, Corporate Services
BRENDAN MCCRACKEN
/s/ Brendan McCracken
Brendan McCracken

SCHEDULE “A”

INCENTIVE COMPENSATION CLAWBACK POLICY:

By resolution of the Board of Directors (the “Board”) of Ovintiv Inc. (“Ovintiv” or the “Corporation”), this Policy is effective as of this 24^th day of January 2020 (the “Effective Date”).

This Policy applies to the President & Chief Executive Officer and each Executive-Vice President of the Corporation and any individual who serves in either such capacity on or following the Effective Date (collectively, the “Executive”). References in this Policy to the “Corporation” include, where applicable, any affiliate thereof.

This Policy has been adopted to enhance the Corporation’s alignment with best practices in respect of risk management and executive compensation and shall be, at all times, subject to and interpreted in a manner consistent with applicable laws or the rules of any applicable stock exchange (collectively, “Applicable Rules”).

This Policy applies to “Incentive-Based Compensation” which, for the purposes of this Policy, means compensation relating to the achievement of performance goals or similar conditions, excluding salary, perquisites, benefits and pension entitlements, and including, without limitation, any award or grant of or any eligibility, entitlement or gain of, an Executive under the Corporation’s: (i) High Performance Results Plan, or any other short-term incentive plan; or (ii) Long-Term Incentive (“LTI”) program including, without limitation, Employee Stock Option Plan, Employee Stock Appreciation Rights Plan, Performance Share Unit Plan, Restricted Share Unit Plan and Deferred Share Unit Plan, as each may be amended from time to time (including any performance-based grants under any such plans).  For greater clarity, this Policy shall not apply to any Incentive-Based Compensation awarded, granted or paid to an Executive prior to the Effective Date.

Where:

▪ the Corporation is required to prepare an accounting restatement due to its material non-compliance with any financial reporting requirement under applicable securities laws (the “Restatement”), (the date upon which the Corporation is required to prepare such Restatement is hereinafter the “Restatement Date”);

▪ the Executive received Incentive-Based Compensation referable to the financial years subject to the Restatement in excess of what the Executive would have been paid under the Restatement (the “Overcompensation Amount”); and

▪ the Executive engaged in gross negligence, intentional misconduct or fraud which caused or significantly contributed to the Corporation’s material non-compliance with applicable securities laws which resulted in the requirement for the Restatement;

the Board shall be entitled:

▪ where and to the extent the Overcompensation Amount has been previously paid, transferred or otherwise made available to the Executive, to require the Executive, by written demand, to reimburse the Corporation for the Overcompensation Amount; and

▪ where all or a portion of the Overcompensation Amount has not been paid, transferred or otherwise made available to the Executive, the right of the Executive to be so paid or have such benefit transferred or otherwise made available to him or her shall, to the extent required to reimburse the Corporation for such Overcompensation Amount, immediately terminate and be forfeited by the Executive and where required, cancelled by the Corporation to such extent and upon such date as may be specified by the Board; and

▪ to the extent the Overcompensation Amount is not immediately recovered upon demand from the Executive, whether via direct reimbursement, forfeiture and/or cancellation, to require a sufficient quantity or value of any compensation owing by the Corporation to the Executive including, without limitation, any unvested or unexercised awards under the LTIs (the “Outstanding LTIs”), be immediately withheld and/or irrevocably cancelled by the Corporation to compensate for (or set off the value of same against) the Overcompensation Amount or any unrecovered portion thereof, and to bring any other actions against the Executive which the Board may deem necessary to recover the Overcompensation Amount.

The period of time during which the Corporation shall be entitled to seek recovery of the Overcompensation Amount from the Executive shall be three (3) years from the Restatement Date. Recoupment of Overcompensation Amounts under this Policy shall be initiated by the Corporation at the request of the Board, and all amounts recoverable or payable hereunder shall be paid to the Corporation or as directed by the Board.  

If Applicable Rules require the Corporation to adopt a policy or provisions relating to the recoupment or recovery of incentive-based or other compensation based on restated financial statements which are inconsistent with or materially differ from this Policy and the Board adopts such policy or provisions to comply with Applicable Rules (the “New Policy”), such New Policy shall replace and supersede this Policy and shall apply to Incentive-Based Compensation granted or awarded to the Executive following the effective date of the New Policy.  Subject to Applicable Rules, this Policy shall continue to apply to Incentive-Based Compensation granted or awarded to the Executive prior to the effective date of the New Policy. This Policy may be terminated at any time by the Board.

EX-10.2

Exhibit 10.2

FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT

THIS FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT (this “First Amendment”) is dated effective as of November 1, 2021 (the “Effective Date”), by and between Corey D. Code (the “Executive”) and Ovintiv Inc., a Delaware corporation (the "Corporation").  The Executive and Corporation may each individually be referred to as a “Party” and together the “Parties”.

WHEREAS, the Executive and Corporation are parties to that certain Change in Control Agreement, effective January 24, 2020 (the "Original CIC Agreement"), pursuant to which the Corporation agreed to provide the Executive with certain compensation and benefits upon a change in control of the Corporation; and

WHEREAS, the Parties desire to amend Section 4 of the Original CIC Agreement to, among other things, modify the calculation of the lump sum bonus payment entitled to the Executive following a change in control event at the Corporation.

NOW THEREFORE,for good and valuable consideration including, among other things, the employment services rendered by the Executive to the Corporation, the receipt and sufficiency of which is hereby acknowledged by the Parties, and in consideration of the mutual covenants and agreements set forth herein, the Parties hereby covenant and agree as follows:

1. Definitions.  All capitalized terms used and not otherwise defined in this First Amendment will have the meanings given to such terms in the Original CIC Agreement.

2. Amendments.

(a) Section 4(a) to the Original CIC Agreement is hereby deleted in its entirety and replaced withthe following:

Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Section 4(c) to the Original CIC Agreement is hereby deleted in its entirety and replaced with the following:

Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s target bonus as of the Date of Termination or (ii) two times the average of the annual

bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

3. Miscellaneous.

(a) Except as expressly amended by this First Amendment, the Parties hereby ratify, confirm and agree to continue be bound by the terms and conditions of the Original CIC Agreement.  This First Amendment and the Original CIC Agreement will hereafter be read and construed together as a single document, and all references to the Original CIC Agreement will hereafter refer to the Original CIC Agreement as amended by this First Amendment.  In the event of any conflict or inconsistency between the provisions of this First Amendment and any provision of the Original CIC Agreement, the provisions of this First Amendment will govern and control.  

(b) No amendment or waiver of any provision of this First Amendment will be binding on any Party unless consented to (whether in writing or electronically) by such Party. This First Amendment will inure to the benefit of and be binding upon the Corporation and its respective successors and assigns and upon the Executive and all other persons claiming or deriving rights through the Executive.

(c) This First Amendment and the rights of all Parties hereunder, and the construction of each and every provision hereof, will be governed by and construed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.

IN WITNESS WHEREOF this First Amendment has been executed effective as of the Effective Date.

Corporation:

OVINTIV INC.

/s/ Brendan M. McCracken

Brendan M. McCracken

President and Chief Executive Officer

/s/ Rachel M. Moore

Rachel M. Moore

Executive Vice President, Corporate Services

Executive:

/s/ Corey D. Code

Corey D. Code, individually

EX-10.3

Exhibit 10.3

FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT

THIS FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT (this “First Amendment”) is dated effective as of November 1, 2021 (the “Effective Date”), by and between Gregory D. Givens (the “Executive”) and Ovintiv Inc., a Delaware corporation (the "Corporation").  The Executive and Corporation may each individually be referred to as a “Party” and together the “Parties”.

WHEREAS, the Executive and Corporation are parties to that certain Change in Control Agreement, effective January 24, 2020 (the "Original CIC Agreement"), pursuant to which the Corporation agreed to provide the Executive with certain compensation and benefits upon a change in control of the Corporation; and

WHEREAS, the Parties desire to amend Section 4 of the Original CIC Agreement to, among other things, modify the calculation of the lump sum bonus payment entitled to the Executive following a change in control event at the Corporation.

NOW THEREFORE,for good and valuable consideration including, among other things, the employment services rendered by the Executive to the Corporation, the receipt and sufficiency of which is hereby acknowledged by the Parties, and in consideration of the mutual covenants and agreements set forth herein, the Parties hereby covenant and agree as follows:

1. Definitions.  All capitalized terms used and not otherwise defined in this First Amendment will have the meanings given to such terms in the Original CIC Agreement.

2. Amendments.

(a) Section 4(a) to the Original CIC Agreement is hereby deleted in its entirety and replaced withthe following:

Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Section 4(c) to the Original CIC Agreement is hereby deleted in its entirety and replaced with the following:

Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s

target bonus as of the Date of Termination or (ii) two times the average of the annual bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

3. Miscellaneous.

(a) Except as expressly amended by this First Amendment, the Parties hereby ratify, confirm and agree to continue be bound by the terms and conditions of the Original CIC Agreement.  This First Amendment and the Original CIC Agreement will hereafter be read and construed together as a single document, and all references to the Original CIC Agreement will hereafter refer to the Original CIC Agreement as amended by this First Amendment.  In the event of any conflict or inconsistency between the provisions of this First Amendment and any provision of the Original CIC Agreement, the provisions of this First Amendment will govern and control.  

(b) No amendment or waiver of any provision of this First Amendment will be binding on any Party unless consented to (whether in writing or electronically) by such Party. This First Amendment will inure to the benefit of and be binding upon the Corporation and its respective successors and assigns and upon the Executive and all other persons claiming or deriving rights through the Executive.

(c) This First Amendment and the rights of all Parties hereunder, and the construction of each and every provision hereof, will be governed by and construed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.

IN WITNESS WHEREOF this First Amendment has been executed effective as of the Effective Date.

Corporation:

OVINTIV INC.

/s/ Brendan M. McCracken

Brendan M. McCracken

President and Chief Executive Officer

/s/ Rachel M. Moore

Rachel M. Moore

Executive Vice President, Corporate Services

Executive:

/s/ Gregory D. Givens

Gregory D. Givens, individually

EX-10.4

Exhibit 10.4

FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT

THIS FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT (this “First Amendment”) is dated effective as of November 1, 2021 (the “Effective Date”), by and between Joanne L. Cox (the “Executive”) and Ovintiv Inc., a Delaware corporation (the "Corporation").  The Executive and Corporation may each individually be referred to as a “Party” and together the “Parties”.

WHEREAS, the Executive and Corporation are parties to that certain Change in Control Agreement, effective January 24, 2020 (the "Original CIC Agreement"), pursuant to which the Corporation agreed to provide the Executive with certain compensation and benefits upon a change in control of the Corporation; and

WHEREAS, the Parties desire to amend Section 4 of the Original CIC Agreement to, among other things, modify the calculation of the lump sum bonus payment entitled to the Executive following a change in control event at the Corporation.

NOW THEREFORE,for good and valuable consideration including, among other things, the employment services rendered by the Executive to the Corporation, the receipt and sufficiency of which is hereby acknowledged by the Parties, and in consideration of the mutual covenants and agreements set forth herein, the Parties hereby covenant and agree as follows:

1. Definitions.  All capitalized terms used and not otherwise defined in this First Amendment will have the meanings given to such terms in the Original CIC Agreement.

2. Amendments.

(a) Section 4(a) to the Original CIC Agreement is hereby deleted in its entirety and replaced withthe following:

Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Section 4(c) to the Original CIC Agreement is hereby deleted in its entirety and replaced with the following:

Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s target bonus as of the Date of Termination or (ii) two times the average of the annual

bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

3. Miscellaneous.

(a) Except as expressly amended by this First Amendment, the Parties hereby ratify, confirm and agree to continue be bound by the terms and conditions of the Original CIC Agreement.  This First Amendment and the Original CIC Agreement will hereafter be read and construed together as a single document, and all references to the Original CIC Agreement will hereafter refer to the Original CIC Agreement as amended by this First Amendment.  In the event of any conflict or inconsistency between the provisions of this First Amendment and any provision of the Original CIC Agreement, the provisions of this First Amendment will govern and control.  

(b) No amendment or waiver of any provision of this First Amendment will be binding on any Party unless consented to (whether in writing or electronically) by such Party. This First Amendment will inure to the benefit of and be binding upon the Corporation and its respective successors and assigns and upon the Executive and all other persons claiming or deriving rights through the Executive.

(c) This First Amendment and the rights of all Parties hereunder, and the construction of each and every provision hereof, will be governed by and construed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.

IN WITNESS WHEREOF this First Amendment has been executed effective as of the Effective Date.

Corporation:

OVINTIV INC.

/s/ Brendan M. McCracken

Brendan M. McCracken

President and Chief Executive Officer

/s/ Rachel M. Moore

Rachel M. Moore

Executive Vice President, Corporate Services

Executive:

/s/ Joanne L. Cox

Joanne L. Cox, individually

EX-10.5

Exhibit 10.5

FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT

THIS FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT (this “First Amendment”) is dated effective as of November 1, 2021 (the “Effective Date”), by and between Rachel M. Moore (the “Executive”) and Ovintiv Inc., a Delaware corporation (the "Corporation").  The Executive and Corporation may each individually be referred to as a “Party” and together the “Parties”.

WHEREAS, the Executive and Corporation are parties to that certain Change in Control Agreement, effective June 30, 2020 (the "Original CIC Agreement"), pursuant to which the Corporation agreed to provide the Executive with certain compensation and benefits upon a change in control of the Corporation; and

WHEREAS, the Parties desire to amend Section 4 of the Original CIC Agreement to, among other things, modify the calculation of the lump sum bonus payment entitled to the Executive following a change in control event at the Corporation.

NOW THEREFORE,for good and valuable consideration including, among other things, the employment services rendered by the Executive to the Corporation, the receipt and sufficiency of which is hereby acknowledged by the Parties, and in consideration of the mutual covenants and agreements set forth herein, the Parties hereby covenant and agree as follows:

1. Definitions.  All capitalized terms used and not otherwise defined in this First Amendment will have the meanings given to such terms in the Original CIC Agreement.

2. Amendments.

(a) Section 4(a) to the Original CIC Agreement is hereby deleted in its entirety and replaced withthe following:

Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Section 4(c) to the Original CIC Agreement is hereby deleted in its entirety and replaced with the following:

Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s target bonus as of the Date of Termination or (ii) two times the average of the annual

bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

3. Miscellaneous.

(a) Except as expressly amended by this First Amendment, the Parties hereby ratify, confirm and agree to continue be bound by the terms and conditions of the Original CIC Agreement.  This First Amendment and the Original CIC Agreement will hereafter be read and construed together as a single document, and all references to the Original CIC Agreement will hereafter refer to the Original CIC Agreement as amended by this First Amendment.  In the event of any conflict or inconsistency between the provisions of this First Amendment and any provision of the Original CIC Agreement, the provisions of this First Amendment will govern and control.  

(b) No amendment or waiver of any provision of this First Amendment will be binding on any Party unless consented to (whether in writing or electronically) by such Party. This First Amendment will inure to the benefit of and be binding upon the Corporation and its respective successors and assigns and upon the Executive and all other persons claiming or deriving rights through the Executive.

(c) This First Amendment and the rights of all Parties hereunder, and the construction of each and every provision hereof, will be governed by and construed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.

IN WITNESS WHEREOF this First Amendment has been executed effective as of the Effective Date.

Corporation:

OVINTIV INC.

/s/ Brendan M. McCracken

Brendan M. McCracken

President and Chief Executive Officer

/s/ Joanne L. Cox

Joanne L. Cox

Executive Vice President, General Counsel & Corporate Secretary

Executive:

/s/ Rachel M. Moore

Rachel M. Moore, individually

EX-10.6

Exhibit 10.6

FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT

THIS FIRST AMENDMENT TO CHANGE IN CONTROL AGREEMENT (this “First Amendment”) is dated effective as of November 1, 2021 (the “Effective Date”), by and between Renee E. Zemljak (the “Executive”) and Ovintiv Inc., a Delaware corporation (the "Corporation").  The Executive and Corporation may each individually be referred to as a “Party” and together the “Parties”.

WHEREAS, the Executive and Corporation are parties to that certain Change in Control Agreement, effective January 24, 2020 (the "Original CIC Agreement"), pursuant to which the Corporation agreed to provide the Executive with certain compensation and benefits upon a change in control of the Corporation; and

WHEREAS, the Parties desire to amend Section 4 of the Original CIC Agreement to, among other things, modify the calculation of the lump sum bonus payment entitled to the Executive following a change in control event at the Corporation.

NOW THEREFORE,for good and valuable consideration including, among other things, the employment services rendered by the Executive to the Corporation, the receipt and sufficiency of which is hereby acknowledged by the Parties, and in consideration of the mutual covenants and agreements set forth herein, the Parties hereby covenant and agree as follows:

1. Definitions.  All capitalized terms used and not otherwise defined in this First Amendment will have the meanings given to such terms in the Original CIC Agreement.

2. Amendments.

(a) Section 4(a) to the Original CIC Agreement is hereby deleted in its entirety and replaced withthe following:

Accrued Obligations. The Corporation shall pay the Executive, in cash, in a lump sum, on the thirtieth (30^th) day following the Date of Termination (the “Payment Date”), the sum of (i) the Executive’s full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given (disregarding any reduction thereto that constitutes Good Reason); (ii) all accrued but unused vacation determined as of the Date of Termination, determined based upon the Executive’s Severance Salary Rate (as defined below) and the Corporation’s vacation policy in effect on the Date of Termination (or, if more favorable to the Executive, the vacation policy in effect as of immediately prior to the Effective Date); (iii) the Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such bonus has been determined but not paid as of the Date of Termination; (iv) if the Date of Termination is not the last day of a fiscal year, a prorated bonus payment equal to the Applicable Bonus (as defined below) multiplied by a fraction, the numerator of which is the number of days which have elapsed in the fiscal year in which the Date of Termination occurs and the denominator of which is the total number of days in such fiscal year; and (v) the Executive’s business expenses that are reimbursable pursuant to the applicable policy of the Corporation as in effect on the Date of Termination but have not been reimbursed by the Corporation as of the Date of Termination.

(b) Section 4(c) to the Original CIC Agreement is hereby deleted in its entirety and replaced with the following:

Annual Incentive Plans. The Corporation shall pay to the Executive, in cash, in a lump sum, on the Payment Date, a payment equal to the greater of (i) two times the Executive’s

target bonus as of the Date of Termination or (ii) two times the average of the annual bonus paid to the Executive by the Corporation in respect of the three complete fiscal years of the Corporation immediately preceding the Effective Date (for any such complete fiscal year for which the Executive was not eligible for an annual bonus, the Executive’s target bonus as in effect immediately prior to the Effective Date) ((i) or (ii), the “Applicable Bonus”).

3. Miscellaneous.

(a) Except as expressly amended by this First Amendment, the Parties hereby ratify, confirm and agree to continue be bound by the terms and conditions of the Original CIC Agreement.  This First Amendment and the Original CIC Agreement will hereafter be read and construed together as a single document, and all references to the Original CIC Agreement will hereafter refer to the Original CIC Agreement as amended by this First Amendment.  In the event of any conflict or inconsistency between the provisions of this First Amendment and any provision of the Original CIC Agreement, the provisions of this First Amendment will govern and control.  

(b) No amendment or waiver of any provision of this First Amendment will be binding on any Party unless consented to (whether in writing or electronically) by such Party. This First Amendment will inure to the benefit of and be binding upon the Corporation and its respective successors and assigns and upon the Executive and all other persons claiming or deriving rights through the Executive.

(c) This First Amendment and the rights of all Parties hereunder, and the construction of each and every provision hereof, will be governed by and construed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.

IN WITNESS WHEREOF this First Amendment has been executed effective as of the Effective Date.

Corporation:

OVINTIV INC.

/s/ Brendan M. McCracken

Brendan M. McCracken

President and Chief Executive Officer

/s/ Rachel M. Moore

Rachel M. Moore

Executive Vice President, Corporate Services

Executive:

/s/ Renee E. Zemljak

Renee E. Zemljak, individually

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Brendan M. McCracken, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Ovintiv Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 4, 2021

/s/ Brendan M. McCracken

Brendan M. McCracken
President & Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Corey D. Code, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Ovintiv Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 4, 2021

/s/ Corey D. Code

Corey D. Code
Executive Vice-President & Chief Financial Officer
(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Ovintiv Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Brendan M. McCracken, President & Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.  

By: /s/ Brendan M. McCracken

Brendan M. McCracken

President & Chief Executive Officer

Dated: November 4, 2021

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Ovintiv Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Corey D. Code, Executive Vice-President & Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.  

By: /s/ Corey D. Code

Corey D. Code

Executive Vice-President & Chief Financial Officer

Dated: November 4, 2021

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2021	Oct. 29, 2021
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2021
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2021
Entity Registrant Name	Ovintiv Inc.
Entity Central Index Key	0001792580
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		261,084,425
Trading Symbol	OVV
Document Quarterly Report	true
Document Transition Report	false
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity File Number	001-39191
Entity Tax Identification Number	84-4427672
Entity Address, Address Line One	Suite 1700
Entity Address, Address Line Two	370 17th Street
Entity Address, City or Town	Denver
Entity Address, State or Province	CO
Entity Address, Country	US
Entity Address, Postal Zip Code	80202
City Area Code	303
Local Phone Number	623-2300
Entity Incorporation, State or Country Code	DE
Title of 12(b) Security	Common Shares
Security Exchange Name	NYSE

XML

Condensed Consolidated Statement of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Revenues
Product and service revenues		$ 2,720	$ 1,326	$ 7,440	$ 3,919
Gains (losses) on risk management, net		(950)	(154)	(2,176)	587
Sublease revenues		19	18	55	53
Total Revenues		1,789	1,190	5,319	4,559
Operating Expenses
Production, mineral and other taxes		77	47	210	126
Transportation and processing		397	365	1,194	1,129
Operating		153	133	466	452
Purchased product		759	322	2,096	1,039
Depreciation, depletion and amortization		297	406	916	1,433
Impairments		0	1,336	0	4,863
Accretion of asset retirement obligation		5	8	17	26
Administrative		101	79	346	297
Total Operating Expenses		1,789	2,696	5,245	9,365
Operating Income (Loss)		0	(1,506)	74	(4,806)
Other (Income) Expenses
Interest		77	97	263	279
Foreign exchange (gain) loss, net		0	(25)	(15)	51
Other (gains) losses, net		(6)	(18)	(31)	(48)
Total Other (Income) Expenses		71	54	217	282
Net Earnings (Loss) Before Income Tax		(71)	(1,560)	(143)	(5,088)
Income tax expense (recovery)		1	(39)	(175)	395
Net Earnings (Loss)		$ (72)	$ (1,521)	$ 32	$ (5,483)
Net Earnings (Loss) per Share of Common Stock
Basic		$ (0.28)	$ (5.85)	$ 0.12	$ (21.10)
Diluted	[1],[2]	$ (0.28)	$ (5.85)	$ 0.12	$ (21.10)
Weighted Average Shares of Common Stock Outstanding (millions)
Basic		261.1	259.8	260.7	259.8
Diluted		261.1	259.8	265.3	259.8

[1] During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain Performance Share Units (“PSUs”) and Restricted Share Units (“RSUs”) with the issuance of the Company’s common stock. As a result, the stock-based compensation awards were modified and reclassified as equity-settled awards.

[2] For the three months ended September 30, 2021, all of Ovintiv’s equity-settled awards were determined to be antidilutive and therefore are excluded from the calculation of fully diluted net earnings (loss) per share of common stock.

XML

Condensed Consolidated Statement of Comprehensive Income (unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net Earnings (Loss)	$ (72)	$ (1,521)	$ 32	$ (5,483)
Other Comprehensive Income (Loss), Net of Tax
Foreign currency translation adjustment	(48)	26	(4)	(21)
Pension and other post-employment benefit plans	(1)	(2)	(4)	(1)
Other Comprehensive Income (Loss)	(49)	24	(8)	(22)
Comprehensive Income (Loss)	$ (121)	$ (1,497)	$ 24	$ (5,505)

XML

Condensed Consolidated Balance Sheet (unaudited) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Current Assets
Cash and cash equivalents	$ 8	$ 10
Accounts receivable and accrued revenues (net of allowances of $3 million (2020: $4 million))	1,221	928
Risk management	1	37
Income tax receivable	98	272
Total Current Assets	1,328	1,247
Oil and natural gas properties, based on full cost accounting
Proved properties	54,684	53,883
Unproved properties	2,217	2,962
Other	897	911
Property, plant and equipment	57,798	57,756
Less: Accumulated depreciation, depletion and amortization	(49,208)	(48,306)
Property, plant and equipment, net	8,590	9,450
Other Assets	1,094	1,143
Risk Management	0	4
Goodwill	2,624	2,625
Total Assets	13,636	14,469
Current Liabilities
Accounts payable and accrued liabilities	1,866	1,704
Current portion of operating lease liabilities	63	68
Income tax payable	4	3
Risk management	1,418	130
Current portion of long-term debt	0	518
Total Current Liabilities	3,351	2,423
Long-Term Debt	4,791	6,367
Operating Lease Liabilities	900	938
Other Liabilities and Provisions	215	358
Risk Management	246	125
Asset Retirement Obligation	336	401
Deferred Income Taxes	0	20
Total Liabilities	9,839	10,632
Commitments and Contingencies
Shareholders’ Equity
Share capital - authorized 775 million shares of stock 2021 issued and outstanding: 261.1 million shares (2020: 259.8 million shares)	3	3
Paid in surplus	8,553	8,531
Retained earnings (Accumulated deficit)	(5,827)	(5,773)
Accumulated other comprehensive income	1,068	1,076
Total Shareholders’ Equity	3,797	3,837
Total Liabilities and Shareholders' Equity	$ 13,636	$ 14,469

XML

Condensed Consolidated Balance Sheet (Parenthetical) (unaudited) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Statement Of Financial Position [Abstract]
Allowances for accounts receivable and accrued revenues	$ 3	$ 4
Share Capital, Authorized	775,000,000	775,000,000
Common Stock, Shares, Issued	261,100,000	259,800,000
Common Stock, Shares, Outstanding	261,100,000	259,800,000

XML

Condensed Consolidated Statement Of Changes In Shareholders' Equity (unaudited) - USD ($) $ in Millions	Total	Share Capital [Member]	Paid In Surplus [Member]	Retained Earnings (Accumulated Deficit) [Member]	Accumulated Other Comprehensive Income [Member]
Balance, Beginning of Period at Dec. 31, 2019	$ 9,930	$ 7,061	$ 1,402	$ 421	$ 1,046
Net Earnings (Loss)	(5,483)	0	0	(5,483)	0
Dividends on Shares of Common Stock	(73)	0	0	(73)	0
Other Comprehensive Income (Loss)	(22)	0	0	0	(22)
Reclassification of Share Capital	0	(7,058)	7,058	0	0
Balance, End of Period at Sep. 30, 2020	4,352	3	8,460	(5,135)	1,024
Balance, Beginning of Period at Dec. 31, 2019	9,930	7,061	1,402	421	1,046
Reclassification of Share Capital		(7,058)
Balance, End of Period at Dec. 31, 2020	3,837	3	8,531	(5,773)	1,076
Balance, Beginning of Period at Jun. 30, 2020	5,873	3	8,460	(3,590)	1,000
Net Earnings (Loss)	(1,521)	0	0	(1,521)	0
Dividends on Shares of Common Stock	(24)	0	0	(24)	0
Other Comprehensive Income (Loss)	24	0	0	0	24
Balance, End of Period at Sep. 30, 2020	4,352	3	8,460	(5,135)	1,024
Balance, Beginning of Period at Dec. 31, 2020	3,837	3	8,531	(5,773)	1,076
Net Earnings (Loss)	32	0	0	32	0
Dividends on Shares of Common Stock	(86)	0	0	(86)	0
Equity-Settled Compensation Costs	22	0	22	0	0
Other Comprehensive Income (Loss)	(8)	0	0	0	(8)
Reclassification of Share Capital		0
Balance, End of Period at Sep. 30, 2021	3,797	3	8,553	(5,827)	1,068
Balance, Beginning of Period at Jun. 30, 2021	3,934	3	8,532	(5,718)	1,117
Net Earnings (Loss)	(72)	0	0	(72)	0
Dividends on Shares of Common Stock	(37)			(37)
Equity-Settled Compensation Costs	21	0	21	0	0
Other Comprehensive Income (Loss)	(49)	0	0	0	(49)
Balance, End of Period at Sep. 30, 2021	$ 3,797	$ 3	$ 8,553	$ (5,827)	$ 1,068

XML

Condensed Consolidated Statement Of Changes In Shareholders' Equity (Parenthetical) (unaudited) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Statement Of Stockholders Equity [Abstract]
Dividends on Shares of Common Stock, per share	$ 0.14	$ 0.09375	$ 0.3275	$ 0.28125

XML

Condensed Consolidated Statement Of Cash Flows (unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Operating Activities
Net earnings (loss)	$ (72)	$ (1,521)	$ 32	$ (5,483)
Depreciation, depletion and amortization	297	406	916	1,433
Impairments	0	1,336	0	4,863
Accretion of asset retirement obligation	5	8	17	26
Deferred income taxes	1	(42)	(19)	393
Unrealized (gain) loss on risk management	579	243	1,426	18
Unrealized foreign exchange (gain) loss	14	(21)	20	30
Foreign exchange on settlements	(3)	(2)	(12)	18
Other	24	(9)	88	(61)
Net change in other assets and liabilities	(10)	(47)	(21)	(167)
Net change in non-cash working capital	(23)	142	(58)	106
Cash From (Used in) Operating Activities	812	493	2,389	1,176
Investing Activities
Capital expenditures	(365)	(351)	(1,098)	(1,393)
Acquisitions	0	(1)	(3)	(19)
Proceeds from divestitures	(8)	39	1,017	69
Net change in investments and other	6	68	(36)	(74)
Cash From (Used in) Investing Activities	(367)	(245)	(120)	(1,417)
Financing Activities
Net issuance (repayment) of revolving long-term debt	0	(100)	(950)	452
Repayment of long-term debt	(518)	(109)	(1,137)	(224)
Dividends on shares of common stock	(37)	(24)	(86)	(73)
Finance lease payments and other	(2)	(23)	(98)	(67)
Cash From (Used in) Financing Activities	(557)	(256)	(2,271)	88
Foreign Exchange Gain (Loss) on Cash, Cash Equivalents and Restricted Cash Held in Foreign Currency	(2)	1	0	(5)
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash	(114)	(7)	(2)	(158)
Cash, Cash Equivalents and Restricted Cash, Beginning of Period	122	39	10	190
Cash, Cash Equivalents and Restricted Cash, End of Period	8	32	8	32
Cash, End of Period	7	22	7	22
Cash Equivalents, End of Period	1	10	1	10
Restricted Cash, End of Period	$ 0	$ 0	$ 0	$ 0

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Basis of Presentation and Principles of Consolidation

9 Months Ended

Sep. 30, 2021

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation and Principles of Consolidation

1. Basis of Presentation and Principles of Consolidation

Ovintiv is in the business of the exploration for, the development of, and the production and marketing of oil, NGLs and natural gas.

The interim Condensed Consolidated Financial Statements include the accounts of Ovintiv and entities in which it holds a controlling interest. All intercompany balances and transactions are eliminated on consolidation. Undivided interests in oil and natural gas exploration and production joint ventures and partnerships are consolidated on a proportionate basis. Investments in non-controlled entities over which the Company has the ability to exercise significant influence are accounted for using the equity method.  

The interim Condensed Consolidated Financial Statements are prepared in conformity with U.S. GAAP and the rules and regulations of the SEC. Pursuant to these rules and regulations, certain information and disclosures normally required under U.S. GAAP have been condensed or have been disclosed on an annual basis only. Accordingly, the interim Condensed Consolidated Financial Statements should be read in conjunction with the annual audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2020, which are included in Item 8 of Ovintiv’s 2020 Annual Report on Form 10-K.

The interim Condensed Consolidated Financial Statements have been prepared following the same accounting policies and methods of computation as the annual audited Consolidated Financial Statements for the year ended December 31, 2020.

These unaudited interim Condensed Consolidated Financial Statements reflect, in the opinion of Management, all normal and recurring adjustments necessary to present fairly the financial position and results of the Company as at and for the periods presented. Interim condensed consolidated financial results are not necessarily indicative of consolidated financial results expected for the fiscal year.

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Segmented Information

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segmented Information

2. Segmented Information

Ovintiv’s reportable segments are determined based on the following operations and geographic locations:

• USA Operations includes the exploration for, development of, and production of oil, NGLs and natural gas and other related activities within the U.S. cost center.

• Canadian Operations includes the exploration for, development of, and production of oil, NGLs and natural gas and other related activities within the Canadian cost center.

• Market Optimization is primarily responsible for the sale of the Company’s proprietary production. These results are reported in the USA and Canadian Operations. Market optimization activities include third-party purchases and sales of product to provide operational flexibility and cost mitigation for transportation commitments, product type, delivery points and customer diversification. These activities are reflected in the Market Optimization segment. Market Optimization sells substantially all of the Company’s upstream production to third-party customers. Transactions between segments are based on market values and are eliminated on consolidation.

Corporate and Other mainly includes unrealized gains or losses recorded on derivative financial instruments. Once the instruments are settled, the realized gains and losses are recorded in the reporting segment to which the derivative instruments relate. Corporate and Other also includes amounts related to sublease rentals.

Results of Operations (For the three months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	1,286		$	670		$	663		$	310	$	771		$	346
Gains (losses) on risk management, net		(265	)		38			(107	)		49		1			2
Sublease revenues		-			-			-			-		-			-
Total Revenues		1,021			708			556			359		772			348
Operating Expenses
Production, mineral and other taxes		75			43			2			4		-			-
Transportation and processing		122			109			231			203		44			53
Operating		122			104			25			24		5			5
Purchased product		-			-			-			-		759			322
Depreciation, depletion and amortization		207			299			83			99		-			-
Impairments		-			1,336			-			-		-			-
Total Operating Expenses		526			1,891			341			330		808			380
Operating Income (Loss)	$	495		$	(1,183	)	$	215		$	29	$	(36	)	$	(32	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	2,720		$	1,326
Gains (losses) on risk management, net		(579	)		(243	)		(950	)		(154	)
Sublease revenues		19			18			19			18
Total Revenues		(560	)		(225	)		1,789			1,190
Operating Expenses
Production, mineral and other taxes		-			-			77			47
Transportation and processing		-			-			397			365
Operating		1			-			153			133
Purchased product		-			-			759			322
Depreciation, depletion and amortization		7			8			297			406
Impairments		-			-			-			1,336
Accretion of asset retirement obligation		5			8			5			8
Administrative		101			79			101			79
Total Operating Expenses		114			95			1,789			2,696
Operating Income (Loss)	$	(674	)	$	(320	)		-			(1,506	)
Other (Income) Expenses
Interest								77			97
Foreign exchange (gain) loss, net								-			(25	)
Other (gains) losses, net								(6	)		(18	)
Total Other (Income) Expenses								71			54
Net Earnings (Loss) Before Income Tax								(71	)		(1,560	)
Income tax expense (recovery)								1			(39	)
Net Earnings (Loss)							$	(72	)	$	(1,521	)

Results of Operations (For the nine months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	3,459		$	1,900		$	1,810		$	906	$	2,171		$	1,113
Gains (losses) on risk management, net		(589	)		412			(164	)		188		3			5
Sublease revenues		-			-			-			-		-			-
Total Revenues		2,870			2,312			1,646			1,094		2,174			1,118
Operating Expenses
Production, mineral and other taxes		199			115			11			11		-			-
Transportation and processing		361			345			703			614		130			170
Operating		368			364			78			75		19			15
Purchased product		-			-			-			-		2,096			1,039
Depreciation, depletion and amortization		635			1,092			265			319		-			-
Impairments		-			4,863			-			-		-			-
Total Operating Expenses		1,563			6,779			1,057			1,019		2,245			1,224
Operating Income (Loss)	$	1,307		$	(4,467	)	$	589		$	75	$	(71	)	$	(106	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	7,440		$	3,919
Gains (losses) on risk management, net		(1,426	)		(18	)		(2,176	)		587
Sublease revenues		55			53			55			53
Total Revenues		(1,371	)		35			5,319			4,559
Operating Expenses
Production, mineral and other taxes		-			-			210			126
Transportation and processing		-			-			1,194			1,129
Operating		1			(2	)		466			452
Purchased product		-			-			2,096			1,039
Depreciation, depletion and amortization		16			22			916			1,433
Impairments		-			-			-			4,863
Accretion of asset retirement obligation		17			26			17			26
Administrative		346			297			346			297
Total Operating Expenses		380			343			5,245			9,365
Operating Income (Loss)	$	(1,751	)	$	(308	)		74			(4,806	)
Other (Income) Expenses
Interest								263			279
Foreign exchange (gain) loss, net								(15	)		51
Other (gains) losses, net								(31	)		(48	)
Total Other (Income) Expenses								217			282
Net Earnings (Loss) Before Income Tax								(143	)		(5,088	)
Income tax expense (recovery)								(175	)		395
Net Earnings (Loss)							$	32		$	(5,483	)

Intersegment Information

							Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the three months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	2,705		$	1,445		$	(1,933	)	$	(1,097	)	$	772		$	348
Operating Expenses
Transportation and processing		141			148			(97	)		(95	)		44			53
Operating		5			5			-			-			5			5
Purchased product		2,596			1,324			(1,837	)		(1,002	)		759			322
Operating Income (Loss)	$	(37	)	$	(32	)	$	1		$	-		$	(36	)	$	(32	)

	Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the nine months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	7,486		$	4,587		$	(5,312	)	$	(3,469	)	$	2,174		$	1,118
Operating Expenses
Transportation and processing		427			468			(297	)		(298	)		130			170
Operating		19			15			-			-			19			15
Purchased product		7,111			4,210			(5,015	)		(3,171	)		2,096			1,039
Operating Income (Loss)	$	(71	)	$	(106	)	$	-		$	-		$	(71	)	$	(106	)

Capital Expenditures

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
USA Operations	$	265	$	244	$	805	$	1,090
Canadian Operations		99		106		291		300
Corporate & Other		1		1		2		3
	$	365	$	351	$	1,098	$	1,393

Goodwill, Property, Plant and Equipment and Total Assets by Segment

	Goodwill					Property, Plant and Equipment					Total Assets
	As at					As at					As at
	September 30,		December 31,			September 30,		December 31,			September 30,		December 31,
	2021			2020		2021			2020		2021			2020
USA Operations	$	1,938		$	1,938	$	7,479		$	8,103	$	10,185		$	10,646
Canadian Operations		686			687		920			1,142		1,861			2,031
Market Optimization		-			-		-			2		293			233
Corporate & Other		-			-		191			203		1,297			1,559
	$	2,624		$	2,625	$	8,590		$	9,450	$	13,636		$	14,469

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Revenues from Contracts with Customers

9 Months Ended

Sep. 30, 2021

Revenue From Contract With Customer [Abstract]

Revenues from Contracts with Customers

3. Revenues from Contracts with Customers

The following tables summarize Ovintiv’s revenues from contracts with customers.

Revenues (For the three months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	866	$	504	$	1	$	1	$	609	$	131
NGLs		250		98		303		139		8		-
Natural gas		172		71		360		172		150		210
Service revenues
Gathering and processing		-		-		1		-		-		-
Product and Service Revenues	$	1,288	$	673	$	665	$	312	$	767	$	341

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	1,476	$	636
NGLs		-		-		561		237
Natural gas		-		-		682		453
Service revenues
Gathering and processing		-		-		1		-
Product and Service Revenues	$	-	$	-	$	2,720	$	1,326

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

Revenues (For the nine months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	2,468	$	1,453	$	7	$	5	$	1,596	$	500
NGLs		587		244		844		406		34		4
Natural gas		413		208		963		501		519		596
Service revenues
Gathering and processing		-		1		4		1		5		-
Product and Service Revenues	$	3,468	$	1,906	$	1,818	$	913	$	2,154	$	1,100

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	4,071	$	1,958
NGLs		-		-		1,465		654
Natural gas		-		-		1,895		1,305
Service revenues
Gathering and processing		-		-		9		2
Product and Service Revenues	$	-	$	-	$	7,440	$	3,919

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

The Company’s revenues from contracts with customers consists of product sales including oil, NGLs and natural gas, as well as the provision of gathering and processing services to third parties. Ovintiv had no contract asset or liability balances during the periods presented. As at September 30, 2021, receivables and accrued revenues from contracts with customers were $1,110 million ($814 million as at December 31, 2020).

Ovintiv’s product sales are sold under short-term contracts with terms that are less than one year at either fixed or market index prices or under long-term contracts exceeding one year at market index prices.

The Company’s gathering and processing services are provided on an interruptible basis with transaction prices that are for fixed prices and/or variable consideration. Variable consideration received is related to recovery of plant operating costs or escalation of the fixed price based on a consumer price index. As the service contracts are interruptible, with service provided on an “as available” basis, there are no unsatisfied performance obligations remaining at September 30, 2021.

As at September 30, 2021, all remaining performance obligations are priced at market index prices or are variable volume delivery contracts. As such, the variable consideration is allocated entirely to the wholly unsatisfied performance obligation or promise to deliver units of production, and revenue is recognized at the amount for which the Company has the right to invoice the product delivered. As the period between when the product sales are transferred and Ovintiv receives payments is generally 30 to 60 days, there is no financing element associated with customer contracts. In addition, Ovintiv does not disclose unsatisfied performance obligations for customer contracts with terms less than 12 months or for variable consideration related to unsatisfied performance obligations.

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Interest

9 Months Ended

Sep. 30, 2021

Interest Expense [Abstract]

Interest

4. Interest

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Interest Expense on:
Debt	$	74	$	91	$	251	$	262
Finance leases		1		2		3		7
Other		2		4		9		10
	$	77	$	97	$	263	$	279

Interest expense on debt for the nine months ended September 30, 2021 includes a one-time make-whole interest payment of $19 million resulting from the June 2021 early redemption of the Company’s $600 million, 5.75 percent senior notes due January 30, 2022 as discussed in Note 10.

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Foreign Exchange (Gain) Loss, Net

9 Months Ended

Sep. 30, 2021

Foreign Currency [Abstract]

Foreign Exchange (Gain) Loss, Net

5. Foreign Exchange (Gain) Loss, Net

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Unrealized Foreign Exchange (Gain) Loss on:
Translation of U.S. dollar financing debt issued from Canada	$	-		$	(6	)	$	1		$	56
Translation of U.S. dollar risk management contracts issued from Canada		14			(15	)		19			1
Translation of intercompany notes		-			-			-			(27	)
		14			(21	)		20			30
Foreign Exchange (Gain) Loss on Settlements of:
U.S. dollar financing debt issued from Canada		-			(2	)		(9	)		15
U.S. dollar risk management contracts issued from Canada		(7	)		(2	)		(25	)		7
Intercompany notes		(3	)		-			(3	)		3
Other Monetary Revaluations		(4	)		-			2			(4	)
	$	-		$	(25	)	$	(15	)	$	51

Following the completion of the corporate reorganization and U.S. domestication in 2020, the U.S. dollar denominated unsecured notes issued by Encana Corporation from Canada were assumed by Ovintiv Inc., a company incorporated in Delaware with a U.S. dollar functional currency. Accordingly, these U.S. dollar denominated unsecured notes, along with certain intercompany notes, no longer attract foreign exchange translation gains or losses.

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Income Taxes

9 Months Ended

Sep. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

6. Income Taxes

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Current Tax
United States	$	-		$	4		$	-		$	3
Canada		-			(1	)		(156	)		(1	)
Total Current Tax Expense (Recovery)		-			3			(156	)		2
Deferred Tax
United States		1			(41	)		1			(180	)
Canada		-			-			(20	)		573
Other Countries		-			(1	)		-			-
Total Deferred Tax Expense (Recovery)		1			(42	)		(19	)		393
Income Tax Expense (Recovery)	$	1		$	(39	)	$	(175	)	$	395
Effective Tax Rate		(1.4	%)		2.5	%		122.4	%		(7.8	%)

Ovintiv’s interim income tax expense is determined using the estimated annual effective income tax rate applied to year-to-date net earnings before income tax plus the effect of legislative changes and amounts in respect of prior periods. The estimated annual effective income tax rate is impacted by expected annual earnings, changes in valuation allowances, income tax related to foreign operations, state tax, the effect of legislative changes, non-taxable capital gains and losses, and tax differences on divestitures and transactions, which can produce interim effective tax rate fluctuations.

During the nine months ended September 30, 2021, the current income tax recovery was primarily due to the resolution of prior year tax items. The resolution, along with other items, resulted in a $222 million reduction of unrecognized tax benefits, offset by a $66 million reduction in valuation allowance. The Company also recognized related interest income of $12 million in other (gains) losses, net. During the nine months ended September 30, 2021, the deferred tax recovery was primarily due to the change in valuation allowances recorded relating to the current year net loss before tax and from the resolution of prior year tax items. During the nine months ended September 30, 2020, the deferred tax expense was primarily due to the recognition of a valuation allowance to reduce the associated deferred tax assets in the United States and Canada.

The effective tax rate of 122.4 percent for the nine months ended September 30, 2021 is higher than the U.S. federal statutory tax rate of 21 percent primarily due to the resolution of certain tax items relating to prior taxation years and the change in

valuation allowances recorded relating to the current year net loss before tax. The effective tax rate of (7.8) percent for the nine months ended September 30, 2020 was lower than the U.S. federal statutory tax rate of 21 percent primarily due to valuation allowances recorded due to net losses arising from ceiling test impairments and an increase in the valuation allowance of $568 million in Canada related to prior years’ deferred tax assets which was recorded as a discrete item. See Note 8 for further discussion related to the ceiling test impairments.

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Acquisitions and Divestitures

9 Months Ended

Sep. 30, 2021

Acquisitions And Divestitures [Abstract]

Acquisitions and Divestitures

7. Acquisitions and Divestitures

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2021		2020			2021			2020
Acquisitions
USA Operations	$	-	$	1		$	3		$	19
Total Acquisitions		-		1			3			19
Divestitures
USA Operations		7		(36	)		(767	)		(63	)
Canadian Operations		1		(3	)		(250	)		(6	)
Total Divestitures		8		(39	)		(1,017	)		(69	)
Net Acquisitions & (Divestitures)	$	8	$	(38	)	$	(1,014	)	$	(50	)

Acquisitions

For the nine months ended September 30, 2020, acquisitions in the USA Operations were $19 million, which primarily included property purchases with oil and liquids rich potential.

Divestitures

For the nine months ended September 30, 2021, divestitures in the USA Operations were $767 million, which primarily included the sale of the Eagle Ford assets located in south Texas for proceeds of approximately $762 million, after closing and other adjustments. For the nine months ended September 30, 2020, divestitures in the USA Operations were $63 million, which primarily included the sale of certain properties that did not complement Ovintiv’s existing portfolio of assets.

For the nine months ended September 30, 2021, divestitures in the Canadian Operations were $250 million, which primarily included the sale of the Duvernay assets located in west central Alberta for proceeds of approximately $238 million, after closing and other adjustments.

Amounts received from the Company’s divestiture transactions have been deducted from the respective U.S. and Canadian full cost pools.

As part of the Duvernay asset divestiture, the Company agreed to a contingent consideration arrangement, which is payable to Ovintiv in the amount of C$5 million at the end of 2021 and an additional C$10 million at the end of 2022, if the annual average of the WTI reference price for each calendar year is greater than $56 per barrel and $62 per barrel, respectively. The contingent consideration was determined to be an embedded derivative and accordingly, the Company recorded the contingent consideration at its fair value of $6 million on the closing date. Subsequent changes in the fair value of the contingent consideration are recognized as a gain or loss and presented in gains (losses) on risk management, net in the Condensed Consolidated Statement of Earnings. The fair value is presented in accounts receivable and accrued revenues, and other assets in the Condensed Consolidated Balance Sheet. See Notes 18 and 19 for further information on the contingent consideration.

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Property, Plant and Equipment, Net

9 Months Ended

Sep. 30, 2021

Property Plant And Equipment [Abstract]

Property, Plant and Equipment, Net

8. Property, Plant and Equipment, Net

	As at September 30, 2021							As at December 31, 2020
			Accumulated							Accumulated
	Cost		DD&A			Net		Cost		DD&A			Net
USA Operations
Proved properties	$	38,530	$	(33,217	)	$	5,313	$	37,875	$	(32,581	)	$	5,294
Unproved properties		2,153		-			2,153		2,785		-			2,785
Other		13		-			13		24		-			24
		40,696		(33,217	)		7,479		40,684		(32,581	)		8,103
Canadian Operations
Proved properties		16,154		(15,307	)		847		16,008		(15,056	)		952
Unproved properties		64		-			64		177		-			177
Other		9		-			9		13		-			13
		16,227		(15,307	)		920		16,198		(15,056	)		1,142
Market Optimization		7		(7	)		-		9		(7	)		2
Corporate & Other		868		(677	)		191		865		(662	)		203
	$	57,798	$	(49,208	)	$	8,590	$	57,756	$	(48,306	)	$	9,450

USA and Canadian Operations’ property, plant and equipment include internal costs directly related to exploration, development and construction activities of $124 million, which have been capitalized during the nine months ended September 30, 2021 (2020 - $133 million).

For the three and nine months ended September 30, 2021, Ovintiv did not recognize ceiling test impairments in the USA Operations (2020 - $1,336 million and $4,863 million before tax, respectively) or Canadian Operations (2020 - nil, respectively). The non-cash ceiling test impairments recognized in the USA Operations in 2020 are included with accumulated DD&A in the table above and primarily resulted from the decline in the 12-month average trailing prices, which reduced proved reserves.

The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices presented below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.

	Oil & NGLs				Natural Gas
	WTI		Edmonton Condensate		Henry Hub		AECO
	($/bbl)		(C$/bbl)		($/MMBtu)		(C$/MMBtu)
12-Month Average Trailing Reserves Pricing (1)
September 30, 2021	$	57.69	$	72.45	$	2.94	$	2.79
December 31, 2020		39.62		49.77		1.98		2.13
September 30, 2020		43.69		53.93		1.97		2.01

(1) All prices were held constant in all future years when estimating net revenues and reserves.

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Leases

9 Months Ended

Sep. 30, 2021

Leases [Abstract]

Leases

9. Leases

The following table outlines Ovintiv’s estimated future sublease income as at September 30, 2021. All subleases are classified as operating leases.

(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Sublease Income	$	13	$	48	$	46	$	46	$	46	$	521	$	720

For the three and nine months ended September 30, 2021, operating lease income was $15 million and $42 million, respectively (2020 - $14 million and $40 million, respectively), and variable lease income was $4 million and $13 million, respectively (2020 - $4 million and $13 million, respectively).

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Long-Term Debt

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Long-Term Debt

10. Long-Term Debt

	As at			As at
	September 30,			December 31,
	2021			2020
U.S. Dollar Denominated Debt
Revolving credit and term loan borrowings	$	-		$	950
U.S. Unsecured Notes:
3.90% due November 15, 2021		-			518
5.75% due January 30, 2022		-			600
5.625% due July 1, 2024		1,000			1,000
5.375% due January 1, 2026		688			688
8.125% due September 15, 2030		300			300
7.20% due November 1, 2031		350			350
7.375% due November 1, 2031		500			500
6.50% due August 15, 2034		750			750
6.625% due August 15, 2037		462			462
6.50% due February 1, 2038		488			488
5.15% due November 15, 2041		203			203
Total Principal		4,741			6,809
Increase in Value of Debt Acquired		82			111
Unamortized Debt Discounts and Issuance Costs		(32	)		(35	)
Total Long-Term Debt	$	4,791		$	6,885
Current Portion	$	-		$	518
Long-Term Portion		4,791			6,367
	$	4,791		$	6,885

On June 18, 2021, the Company completed the redemption of its $600 million, 5.75 percent senior notes due January 30, 2022. Ovintiv paid approximately $632 million in cash including accrued and unpaid interest of $13 million and a one-time make-whole payment of $19 million, which is included in interest expense as discussed in Note 4.

On August 16, 2021, the Company completed the redemption of its $518 million, 3.90 percent senior notes due November 15, 2021. The Company redeemed the notes at par and paid approximately $523 million in cash including accrued and unpaid interest of $5 million.

The Company used the net proceeds from its Eagle Ford and Duvernay asset sales, as discussed in Note 7, and cash on hand to complete the senior note redemptions.

During the three and nine months ended September 30, 2020, the Company repurchased in the open market approximately $115 million and $252 million, respectively, in principal amount of its senior notes. The aggregate cash payments related to the note repurchases were $109 million and $224 million, respectively, plus accrued interest, and net gains of approximately $6 million and $28 million, respectively, were recognized in other (gains) losses, net in the Condensed Consolidated Statement of Earnings.

As at September 30, 2021, total long-term debt had a carrying value of $4,791 million and a fair value of $5,989 million (as at December 31, 2020 - carrying value of $6,885 million and a fair value of $7,379 million). The estimated fair value of long-term borrowings is categorized within Level 2 of the fair value hierarchy and has been determined based on market information of long-term debt with similar terms and maturity, or by discounting future payments of interest and principal at interest rates expected to be available to the Company at period end.

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Other Liabilities and Provisions

9 Months Ended

Sep. 30, 2021

Other Liabilities Disclosure [Abstract]

Other Liabilities and Provisions

11. Other Liabilities and Provisions

	As at		As at
	September 30,		December 31,
	2021		2020
Finance Lease Obligations	$	35	$	39
Unrecognized Tax Benefits (See Note 6)		-		158
Pensions and Other Post-Employment Benefits		129		129
Long-Term Incentive Costs (See Note 16)		31		9
Other Derivative Contracts (See Notes 18, 19)		5		7
Other		15		16
	$	215	$	358

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Share Capital

9 Months Ended

Sep. 30, 2021

Class Of Stock Disclosures [Abstract]

Share Capital

12. Share Capital

Authorized

Ovintiv is authorized to issue 750 million shares of common stock, par value $0.01 per share, and 25 million shares of preferred stock, par value $0.01 per share. No shares of preferred stock are outstanding.

Issued and Outstanding

	As at September 30, 2021				As at December 31, 2020
	Number (millions)		Amount		Number (millions)		Amount
Shares of Common Stock Outstanding, Beginning of Year		259.8	$	3		259.8	$	7,061
Shares of Common Stock Issued (See Note 16)		1.3		-		-		-
Reclassification of Share Capital		-		-		-		(7,058	)
Shares of Common Stock Outstanding, End of Period		261.1	$	3		259.8	$	3

In conjunction with the corporate reorganization and U.S. domestication completed in 2020, the amount recognized in share capital in excess of Ovintiv’s established par value of $0.01 per share was reclassified to paid in surplus. Accordingly, approximately $7,058 million was reclassified.

On September 28, 2021, the Company announced it had received regulatory approval to purchase, for cancellation, up to approximately 26.0 million shares of common stock, pursuant to a NCIB over a 12-month period from October 1, 2021 to September 30, 2022.

Dividends

During the three months ended September 30, 2021, the Company declared and paid dividends of $0.14 per share of Ovintiv common stock totaling $37 million (2020 - $0.09375 per share of Ovintiv common stock totaling $24 million).

During the nine months ended September 30, 2021, the Company declared and paid dividends of $0.3275 per share of Ovintiv common stock totaling $86 million (2020 - $0.28125 per share of Ovintiv common stock totaling $73 million).

On November 2, 2021, the Board of Directors declared a dividend of $0.14 per share of Ovintiv common stock payable on December 31, 2021 to stockholders of record as of December 15, 2021.

Earnings Per Share of Common Stock

The following table presents the computation of net earnings (loss) per share of common stock:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(US$ millions, except per share amounts)	2021			2020			2021		2020
Net Earnings (Loss)	$	(72	)	$	(1,521	)	$	32	$	(5,483	)
Number of Shares of Common Stock:
Weighted average shares of common stock outstanding - Basic		261.1			259.8			260.7		259.8
Effect of dilutive securities (1) (2)		-			-			4.6		-
Weighted Average Shares of Common Stock Outstanding - Diluted		261.1			259.8			265.3		259.8
Net Earnings (Loss) per Share of Common Stock
Basic	$	(0.28	)	$	(5.85	)	$	0.12	$	(21.10	)
Diluted (1) (2)		(0.28	)		(5.85	)		0.12		(21.10	)

(1) During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain Performance Share Units (“PSUs”) and Restricted Share Units (“RSUs”) with the issuance of the Company’s common stock. As a result, the stock-based compensation awards were modified and reclassified as equity-settled awards.

(2) For the three months ended September 30, 2021, all of Ovintiv’s equity-settled awards were determined to be antidilutive and therefore are excluded from the calculation of fully diluted net earnings (loss) per share of common stock.

Shares issued as a result of awards granted from stock-based compensation plans are generally funded out of the common stock authorized for issuance as approved by the Company’s shareholders.

Stock-Based Compensation Plans

Ovintiv’s PSU and RSU stock-based compensation plans allow the Company to settle the awards either in cash or in the Company’s common stock. The PSUs and RSUs are classified as equity-settled if the Company has sufficient common stock held in reserve for issuance. These awards are included in the computation of diluted net earnings (loss) per share of common stock if dilutive.

Ovintiv’s stock options with associated Tandem Stock Appreciation Rights (“TSARs”) give the employee the right to purchase shares of common stock of the Company or receive cash. Historically, most holders of options have elected to exercise their TSARs in exchange for a cash payment. As a result, outstanding options are not considered potentially dilutive securities.

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Accumulated Other Comprehensive Income

9 Months Ended

Sep. 30, 2021

Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract]

Accumulated Other Comprehensive Income

13. Accumulated Other Comprehensive Income

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Foreign Currency Translation Adjustment
Balance, Beginning of Period	$	1,086		$	957		$	1,042		$	1,004
Change in Foreign Currency Translation Adjustment		(48	)		26			(4	)		(21	)
Balance, End of Period	$	1,038		$	983		$	1,038		$	983
Pension and Other Post-Employment Benefit Plans
Balance, Beginning of Period	$	31		$	43		$	34		$	42
Amounts Reclassified from Other Comprehensive Income:
Reclassification of net actuarial (gains) and losses to net earnings (See Note 17)		(1	)		(2	)		(5	)		(6	)
Income taxes		-			-			1			1
Curtailment in net defined periodic benefit cost (See Note 17)		-			-			-			5
Income taxes		-			-			-			(1	)
Balance, End of Period	$	30		$	41		$	30		$	41
Total Accumulated Other Comprehensive Income	$	1,068		$	1,024		$	1,068		$	1,024

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Variable Interest Entities

9 Months Ended

Sep. 30, 2021

Variable Interest Entity Not Primary Beneficiary Disclosures [Abstract]

Variable Interest Entities

14. Variable Interest Entities

Veresen Midstream Limited Partnership

Veresen Midstream Limited Partnership (“VMLP”) provides gathering, compression and processing services under various agreements related to the Company’s development of liquids and natural gas production in the Montney play. As at September 30, 2021, VMLP provides approximately 1,167 MMcf/d of natural gas gathering and compression and 925 MMcf/d of natural gas processing under long-term service agreements with remaining terms ranging from 10 to 24 years and have various renewal terms providing up to a potential maximum of 10 years.

Ovintiv has determined that VMLP is a VIE and that Ovintiv holds variable interests in VMLP. Ovintiv is not the primary beneficiary as the Company does not have the power to direct the activities that most significantly impact VMLP’s economic performance. These key activities relate to the construction, operation, maintenance and marketing of the assets owned by VMLP. The variable interests arise from certain terms under the various long-term service agreements and include: i) a take or pay for volumes in certain agreements; ii) an operating fee of which a portion can be converted into a fixed fee once VMLP assumes operatorship of certain assets; and iii) a potential payout of minimum costs in certain agreements. The potential payout of minimum costs will be assessed in the eighth year of the assets’ service period and is based on whether there is an overall shortfall of total system cash flows from natural gas gathered and compressed under certain agreements. The potential payout amount can be reduced in the event VMLP markets unutilized capacity to third-party users. Ovintiv is not required to provide any financial support or guarantees to VMLP.

As a result of Ovintiv’s involvement with VMLP, the maximum total exposure to loss related to the commitments under the agreements is estimated to be $1,782 million as at September 30, 2021. The estimate comprises the take or pay volume commitments and the potential payout of minimum costs. The take or pay volume commitments associated with certain gathering and processing assets are included in Note 21 under Transportation and Processing. The potential payout requirement is highly uncertain as the amount is contingent on future production estimates, pace of development and the amount of capacity contracted to third parties. As at September 30, 2021, accounts payable and accrued liabilities included $0.5 million related to the take or pay commitment.

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Restructuring Charges

9 Months Ended

Sep. 30, 2021

Restructuring Charges [Abstract]

Restructuring Charges

15. Restructuring Charges

In June 2020, Ovintiv undertook a plan to reduce its workforce by approximately 25 percent as part of a company-wide reorganization in response to the low commodity price environment resulting from the global pandemic and the Company’s planned reductions in capital spending. During the three and nine months ended September 30, 2021, the Company incurred restructuring charges of $2 million and $13 million, respectively (2020 - $7 million and $88 million, respectively), before tax, primarily related to severance costs. Of the $103 million in restructuring charges incurred to date, $3 million remains accrued as at September 30, 2021 ($14 million as at December 31, 2020). The majority of the remaining amounts accrued are expected to be paid in 2021 and total transition and severance costs are expected to be approximately $104 million, before tax.

Restructuring charges are included in administrative expense presented in the Corporate and Other segment in the Condensed Consolidated Statement of Earnings.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Severance and Benefits	$	2	$	6	$	13	$	86
Outplacement, Moving and Other Expenses		-		1		-		2
Restructuring Expenses	$	2	$	7	$	13	$	88

	As at			As at
	September 30,			December 31,
	2021			2020
Outstanding Restructuring Accrual, Beginning of Year	$	14		$	8
Restructuring Expenses Incurred		13			90
Restructuring Costs Paid		(24	)		(84	)
Outstanding Restructuring Accrual, End of Period (1)	$	3		$	14

(1) Included in accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheet.

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Compensation Plans

9 Months Ended

Sep. 30, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Compensation Plans

16. Compensation Plans

Ovintiv has a number of compensation arrangements under which the Company awards various types of long-term incentive grants to eligible employees and Directors. They may include TSARs, Stock Appreciation Rights (“SARs”), PSUs, Deferred Share Units (“DSUs”) and RSUs.

Ovintiv accounts for PSUs and RSUs as equity-settled stock-based payment transactions provided there is sufficient common stock held in reserve for issuance. TSARs, SARs and DSUs are accounted for as cash-settled stock-based payment transactions. The Company accrues compensation costs over the vesting period based on the fair value of the rights determined using the Black-Scholes-Merton or other appropriate fair value models.

During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain PSU awards and RSU awards with the issuance of the Company’s common stock. Historically, the Company settled PSU and RSU awards in cash. As a result, the respective awards were modified and reclassified as equity-settled share-based payment transactions at the modification date. The modified awards accrue compensation expense using the modification date fair value of the awards over the remaining vesting period. Common stock used to settle the PSU and RSU awards will be issued from Ovintiv’s common stock authorized and held in reserve for issuance under the Company’s stock-based compensation plans.

The following weighted average assumptions were used to determine the fair value of TSAR and SAR units outstanding:  

	As at September 30, 2021		As at September 30, 2020
	US$ SAR Share Units	C$ TSAR Share Units	US$ SAR Share Units	C$ TSAR Share Units
Risk Free Interest Rate	0.49%	0.49%	0.22%	0.22%
Dividend Yield	1.70%	1.68%	4.60%	4.66%
Expected Volatility Rate (1)	106.19%	105.03%	102.43%	101.65%
Expected Term	1.5 yrs	1.5 yrs	2.5 yrs	2.0 yrs
Market Share Price	US$32.88	C$41.62	US$8.16	C$10.89
Weighted Average Grant Date Fair Value	US$37.63	C$50.46	US$38.11	C$48.28

(1) Volatility was estimated using historical rates.

The Company has recognized the following share-based compensation costs:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Total Compensation Costs of Transactions Classified as Cash-Settled	$	33		$	4		$	115		$	(12	)
Total Compensation Costs of Transactions Classified as Equity-Settled		7			-			25			-
Less: Total Share-Based Compensation Costs Capitalized		(7	)		(2	)		(23	)		3
Total Share-Based Compensation Expense (Recovery)	$	33		$	2		$	117		$	(9	)
Recognized in the Condensed Consolidated Statement of Earnings in:
Operating	$	8		$	1		$	26		$	(3	)
Administrative		25			1			91			(6	)
	$	33		$	2		$	117		$	(9	)

As at September 30, 2021, the liability for cash-settled share-based payment transactions totaled $109 million ($34 million as at December 31, 2020), of which $78 million ($25 million as at December 31, 2020) is recognized in accounts payable and accrued liabilities and $31 million ($9 million as at December 31, 2020) is recognized in other liabilities and provisions in the Condensed Consolidated Balance Sheet.

The following units were granted primarily in conjunction with the Company’s annual grant of long-term incentive awards. The PSUs and RSUs were granted at the volume-weighted average trading price of shares of Ovintiv common stock for the five days prior to the grant date.

Nine Months Ended September 30, 2021 (thousands of units)
RSUs	2,748
PSUs	934
DSUs	14

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Pension and Other Post-Employment Benefits

9 Months Ended

Sep. 30, 2021

General Discussion Of Pension And Other Postretirement Benefits [Abstract]

Pension and Other Post-Employment Benefits

17. Pension and Other Post-Employment Benefits

The Company has recognized total benefit plans expense which includes pension benefits and other post-employment benefits (“OPEB”) for the nine months ended September 30 as follows:

	Pension Benefits				OPEB					Total
	2021		2020		2021			2020		2021			2020
Net Defined Periodic Benefit Cost	$	-	$	-	$	(2	)	$	2	$	(2	)	$	2
Defined Contribution Plan Expense		19		24		-			-		19			24
Total Benefit Plans Expense	$	19	$	24	$	(2	)	$	2	$	17		$	26

Of the total benefit plans expense, $18 million (2020 - $22 million) was included in operating expense and $4 million (2020 - $5 million) was included in administrative expense. Excluding service costs, net defined periodic benefit gains of $5 million (2020 - $1 million) were recorded in other (gains) losses, net.

The net defined periodic benefit cost for the nine months ended September 30 is as follows:

	Defined Benefits						OPEB						Total
	2021			2020			2021			2020			2021			2020
Service Cost	$	-		$	-		$	3		$	3		$	3		$	3
Interest Cost		3			4			1			2			4			6
Expected Return on Plan Assets		(4	)		(5	)		-			-			(4	)		(5	)
Amounts Reclassified from Accumulated Other     Comprehensive Income:
Amortization of net actuarial (gains) and losses		1			1			(6	)		(7	)		(5	)		(6	)
Curtailment from net prior service costs		-			-			-			5			-			5
Curtailment		-			-			-			(1	)		-			(1	)
Total Net Defined Periodic Benefit Cost (1)	$	-		$	-		$	(2	)	$	2		$	(2	)	$	2

(1) The components of total net defined periodic benefit cost, excluding the service cost component, are included in other (gains) losses, net.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

18. Fair Value Measurements

The fair values of cash and cash equivalents, accounts receivable and accrued revenues, and accounts payable and accrued liabilities approximate their carrying amounts due to the short-term maturity of those instruments. The fair values of restricted cash and marketable securities included in other assets approximate their carrying amounts due to the nature of the instruments held.

Recurring fair value measurements are performed for risk management assets and liabilities and other derivative contracts, as discussed further in Note 19. These items are carried at fair value in the Condensed Consolidated Balance Sheet and are classified within the three levels of the fair value hierarchy in the following tables.

Fair value changes and settlements for amounts related to risk management assets and liabilities are recognized in revenues and foreign exchange gains and losses according to their purpose.

As at September 30, 2021	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	41	$	-	$	41	$	(41	)	$	-
Long-term assets		-		2		-		2		(2	)		-
Foreign Currency Derivatives:
Current assets		-		7		-		7		(6	)		1
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	4	$	1,163	$	298	$	1,465	$	(41	)	$	1,424
Long-term liabilities		-		211		37		248		(2	)		246
Foreign Currency Derivatives:
Current liabilities		-		-		-		-		(6	)		(6	)
Other Derivative Contracts (2)
Current in accounts receivable and accrued revenues	$	-	$	-	$	4	$	4	$	-		$	4
Long-term in other assets		-		-		5		5		-			5
Current in accounts payable and accrued liabilities		-		1		-		1		-			1
Long-term in other liabilities and provisions		-		5		-		5		-			5

As at December 31, 2020	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	70	$	-	$	70	$	(59	)	$	11
Long-term assets		-		7		-		7		(3	)		4
Foreign Currency Derivatives:
Current assets		-		26		-		26		-			26
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	1	$	114	$	74	$	189	$	(59	)	$	130
Long-term liabilities		-		128		-		128		(3	)		125
Other Derivative Contracts (2)
Current in accounts payable and accrued liabilities	$	-	$	1	$	-	$	1	$	-		$	1
Long-term in other liabilities and provisions		-		7		-		7		-			7

(1) Netting to offset derivative assets and liabilities where the legal right and intention to offset exists, or where counterparty master netting arrangements contain provisions for net settlement.

(2) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

The Company’s Level 1 and Level 2 risk management assets and liabilities consist of commodity fixed price contracts, NYMEX fixed price swaptions, NYMEX three-way options, NYMEX costless collars, NYMEX call options, foreign currency swaps and basis swaps with terms to 2025. Level 2 also includes financial guarantee contracts as discussed in Note 19. The fair values of these contracts are estimated using inputs which are either directly or indirectly observable from active markets, such as exchange and other published prices, broker quotes and observable trading activity throughout the term of the instruments.

Level 3 Fair Value Measurements

As at September 30, 2021, the Company’s Level 3 risk management assets and liabilities consist of WTI three-way options, WTI costless collars and contingent consideration derivative contracts tied to WTI with terms to 2022. The WTI three-way options are a combination of a sold call, bought put and a sold put. The WTI costless collars are a combination of a sold call and a bought put. These contracts allow the Company to participate in the upside of commodity prices to the ceiling of the call option and provide the Company with complete (collars) or partial (three-way) downside price protection through the put options. The fair values of these contracts are determined using an option pricing model using observable and unobservable inputs such as implied volatility. The unobservable inputs are obtained from third parties whenever possible and reviewed by the Company for reasonableness.

A summary of changes in Level 3 fair value measurements for risk management positions is presented below:

	Nine Months Ended
	September 30,
	2021			2020
Balance, Beginning of Year	$	(74	)	$	(52	)
Total Gains (Losses)		(637	)		214
Purchases, Sales, Issuances and Settlements:
Purchases, sales and issuances (1)		6			-
Settlements		379			(83	)
Transfers Out of Level 3		-			-
Balance, End of Period	$	(326	)	$	79
Change in Unrealized Gains (Losses) During the    Period Included in Net Earnings (Loss)	$	(258	)	$	131

(1) Relates to the contingent consideration associated with the Duvernay divestiture discussed in Note 7.

Quantitative information about unobservable inputs used in Level 3 fair value measurements is presented below as at September 30, 2021:

	Valuation Technique	Unobservable Input	Range	Weighted Average (1)
Risk Management - WTI Options	Option Model	Implied Volatility	34% - 138%	48%

(1) Unobservable inputs were weighted by the relative fair value of the instruments.

A 10 percent increase or decrease in implied volatility for the WTI options would cause an approximate corresponding $17 million ($6 million as at December 31, 2020) increase or decrease to net risk management assets and liabilities.

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Financial Instruments and Risk Management

9 Months Ended

Sep. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Financial Instruments and Risk Management

19. Financial Instruments and Risk Management

A)  Financial Instruments

Ovintiv’s financial assets and liabilities are recognized in cash and cash equivalents, accounts receivable and accrued revenues, other assets, accounts payable and accrued liabilities, risk management assets and liabilities, long-term debt, and other liabilities and provisions.

B)  Risk Management Activities

Ovintiv uses derivative financial instruments to manage its exposure to cash flow variability from commodity prices and fluctuating foreign currency exchange rates. The Company does not apply hedge accounting to any of its derivative financial instruments. As a result, gains and losses from changes in the fair value are recognized in net earnings (loss).

Commodity Price Risk

Commodity price risk arises from the effect that fluctuations in future commodity prices may have on future cash flows. To partially mitigate exposure to commodity price risk, the Company has entered into various derivative financial instruments.  The use of these derivative instruments is governed under formal policies and is subject to limits established by the Board of Directors.

Crude Oil and NGLs - To partially mitigate crude oil and NGL commodity price risk, the Company uses WTI- and NGL-based contracts such as fixed price contracts, options and costless collars. Ovintiv has also entered into basis swaps to manage against widening price differentials between various production areas, products and price points.

Natural Gas - To partially mitigate natural gas commodity price risk, the Company uses NYMEX-based contracts such as fixed price contracts, fixed price swaptions, options and costless collars. Ovintiv has also entered into basis swaps to manage against widening price differentials between various production areas and benchmark price points.

Foreign Exchange Risk

Foreign exchange risk arises from changes in foreign currency exchange rates that may affect the fair value or future cash flows of the Company’s financial assets or liabilities. To partially mitigate the effect of foreign exchange fluctuations on future commodity revenues and expenses, the Company may enter into foreign currency derivative contracts. As at September 30, 2021, the Company has entered into $88 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.3720 to US$1, which mature monthly through the remainder of 2021 and $100 million notional U.S. dollar denominated currency swaps at an average exchange rate of C$1.2820 to US$1, which mature monthly throughout 2022.

Risk Management Positions as at September 30, 2021

	Notional Volumes	Term	Average Price		Fair Value
Crude Oil and NGL Contracts			US$/bbl
Fixed Price Contracts
WTI Fixed Price	30.0 Mbbls/d	2021		46.37	$	(77	)
WTI Fixed Price	5.0 Mbbls/d	2022		60.16		(18	)
Ethane Fixed Price	8.0 Mbbls/d	2021		11.05		(5	)
Propane Fixed Price	12.0 Mbbls/d	2021		25.78		(38	)
Butane Fixed Price	5.0 Mbbls/d	2021		24.83		(19	)
WTI Three-Way Options
Sold call / bought put / sold put	85.0 Mbbls/d	2021	53.92 / 44.66 / 34.79			(136	)
Sold call / bought put / sold put	75.0 Mbbls/d	2022	70.79 / 60.82 / 49.33			(164	)
WTI Costless Collars
Sold call / bought put	15.0 Mbbls/d	2021	45.84 / 35.00			(35	)
Basis Contracts (1)		2021				(4	)
		2022				(1	)
Other Crude Financial Positions						-
Crude Oil and NGLs Fair Value Position						(497	)
Natural Gas Contracts			US$/Mcf
Fixed Price Contracts
NYMEX Fixed Price	165 MMcf/d	2021		2.51		(52	)
NYMEX Fixed Price	200 MMcf/d	2022		2.67		(125	)
NYMEX Fixed Price Swaptions (2)	165 MMcf/d	2022		2.51		(113	)
NYMEX Three-Way Options
Sold call / bought put / sold put	980 MMcf/d	2021	3.36 / 2.89 / 2.50			(230	)
Sold call / bought put / sold put	398 MMcf/d	2022	3.02 / 2.75 / 2.00			(205	)
NYMEX Costless Collars
Sold call / bought put	200 MMcf/d	2022	2.85 / 2.55			(116	)
NYMEX Call Options
Sold call	330 MMcf/d	2022		2.38		(244	)
Basis Contracts (3)		2021				(9	)
		2022				(29	)
		2023 - 2025				(34	)
Other Financial Positions						(16	)
Natural Gas Fair Value Position						(1,173	)
Other Derivative Contracts
Fair Value Position (4)						3
Foreign Currency Contracts
Fair Value Position (5)		2021 - 2022				7
Total Fair Value Position					$	(1,660	)

(1) Ovintiv has entered into crude and NGL differential swaps associated with Canadian condensate and WTI.

(2) NYMEX Fixed Price Swaptions give the counterparty the option to extend certain 2021 Fixed Price swaps to 2022.

(3) Ovintiv has entered into natural gas basis swaps associated with AECO, Dawn, Malin, Waha, Houston Ship Channel and NYMEX.

(4) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

(5) Ovintiv has entered into U.S. dollar denominated fixed-for-floating average currency swaps to protect against fluctuations between the Canadian and U.S. dollars.

Earnings Impact of Realized and Unrealized Gains (Losses) on Risk Management Positions

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Realized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (1)	$	(371	)	$	89		$	(750	)	$	605
Foreign Currency Derivatives:
Foreign exchange		7			2			25			(7	)
	$	(364	)	$	91		$	(725	)	$	598
Unrealized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (2)	$	(579	)	$	(243	)	$	(1,426	)	$	(18	)
Foreign Currency Derivatives:
Foreign exchange		(11	)		15			(19	)		(1	)
	$	(590	)	$	(228	)	$	(1,445	)	$	(19	)
Total Realized and Unrealized Gains (Losses) on Risk Management, net
Commodity and Other Derivatives:
Revenues (1) (2)	$	(950	)	$	(154	)	$	(2,176	)	$	587
Foreign Currency Derivatives:
Foreign exchange		(4	)		17			6			(8	)
	$	(954	)	$	(137	)	$	(2,170	)	$	579

(1) Includes realized gains of nil and $1 million for the three and nine months ended September 30, 2021, respectively (2020 - gains of nil and $2 million, respectively), related to other derivative contracts.

(2) Includes unrealized gains of $1 million and $4 million for the three and nine months ended September 30, 2021, respectively (2020 - losses of nil and $4 million, respectively), related to other derivative contracts.

Reconciliation of Unrealized Risk Management Positions from January 1 to September 30

	2021						2020
	Fair Value			Total Unrealized Gain (Loss)			Total Unrealized Gain (Loss)
Fair Value of Contracts, Beginning of Year	$	(222	)
Change in Fair Value of Contracts in Place at Beginning of Year    and Contracts Entered into During the Period		(2,170	)	$	(2,170	)	$	579
Settlement of Other Derivative Contracts		1
Fair Value of Other Derivative Contract Assets Entered into    During the Period (See Note 7)		6
Fair Value of Contracts Realized During the Period		725			725			(598	)
Fair Value of Contracts, End of Period	$	(1,660	)	$	(1,445	)	$	(19	)

Risk management assets and liabilities arise from the use of derivative financial instruments and are measured at fair value.  See Note 18 for a discussion of fair value measurements.

Unrealized Risk Management Positions

	As at			As at
	September 30,			December 31,
	2021			2020
Risk Management Assets
Current	$	1		$	37
Long-term		-			4
		1			41
Risk Management Liabilities
Current		1,418			130
Long-term		246			125
		1,664			255
Other Derivative Contract Assets
Current in accounts receivable and accrued revenues		4			-
Long-term in other assets		5			-
		9			-
Other Derivative Contract Liabilities
Current in accounts payable and accrued liabilities		1			1
Long-term in other liabilities and provisions		5			7
		6			8
Net Risk Management Assets (Liabilities) and Other Derivative Contracts	$	(1,660	)	$	(222	)

C)  Credit Risk

Credit risk arises from the potential that the Company may incur a loss if a counterparty to a financial instrument fails to meet its obligation in accordance with agreed terms. While exchange-traded contracts are subject to nominal credit risk due to the financial safeguards established by the NYSE and the TSX, over-the-counter traded contracts expose Ovintiv to counterparty credit risk. Counterparties to the Company’s derivative financial instruments consist primarily of major financial institutions and companies within the energy industry. This credit risk exposure is mitigated through the use of credit policies approved by the Board of Directors governing the Company’s credit portfolio including credit practices that limit transactions according to counterparties’ credit quality. Mitigation strategies may include master netting arrangements, requesting collateral, purchasing credit insurance and/or transacting credit derivatives. The Company executes commodity derivative financial instruments under master agreements that have netting provisions that provide for offsetting payables against receivables. Ovintiv actively evaluates the creditworthiness of its counterparties, assigns appropriate credit limits and monitors credit exposures against those assigned limits. As at September 30, 2021, Ovintiv’s maximum exposure of loss due to credit risk from derivative financial instrument assets on a gross and net fair value basis was $59 million and $10 million, respectively, as disclosed in Note 18. The Company had no significant credit derivatives in place and held no collateral at September 30, 2021.

As at September 30, 2021, cash equivalents include high-grade, short-term securities, placed primarily with financial institutions with strong investment grade ratings. Any foreign currency agreements entered into are with major financial institutions that have investment grade credit ratings.  

A substantial portion of the Company’s accounts receivable are with customers and working interest owners in the oil and gas industry and are subject to normal industry credit risks. As at September 30, 2021, approximately 91 percent (89 percent as at December 31, 2020) of Ovintiv’s accounts receivable and financial derivative credit exposures were with investment grade counterparties.

During 2015 and 2017, the Company entered into agreements resulting from divestitures, which may require Ovintiv to fulfill certain payment obligations on the take or pay volume commitments assumed by the purchasers. The circumstances that would require Ovintiv to perform under the agreements include events where a purchaser fails to make payment to the guaranteed party and/or a purchaser is subject to an insolvency event. The agreements have remaining terms of less than three years with a fair value recognized of $6 million as at September 30, 2021 ($8 million as at December 31, 2020). The maximum potential amount of undiscounted future payments is $63 million as at September 30, 2021, and is considered unlikely.

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Supplementary Information

9 Months Ended

Sep. 30, 2021

Supplemental Cash Flow Elements [Abstract]

Supplementary Information

20. Supplementary Information

Supplemental disclosures to the Condensed Consolidated Statement of Cash Flows are presented below:

A) Net Change in Non-Cash Working Capital

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Operating Activities
Accounts receivable and accrued revenues	$	(25	)	$	78		$	(287	)	$	289
Accounts payable and accrued liabilities		13			42			211			(212	)
Current portion of operating lease liabilities		(9	)		(4	)		(5	)		(10	)
Income tax receivable and payable		(2	)		26			23			39
	$	(23	)	$	142		$	(58	)	$	106

B) Non-Cash Activities

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Non-Cash Operating Activities
ROU operating lease assets and liabilities	$	(4	)	$	(5	)	$	(22	)	$	(6	)
Non-Cash Investing Activities
Asset retirement obligation incurred	$	-		$	2		$	-		$	11
Asset retirement obligation change in estimated future cash outflows		-			(10	)		-			12
Property, plant and equipment accruals		4			68			(33	)		(62	)
Capitalized long-term incentives		5			2			12			(7	)
Property additions/dispositions (swaps)		18			212			24			229
Contingent consideration (See Note 7)		-			-			6			-

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

21. Commitments and Contingencies

Commitments

The following table outlines the Company’s commitments as at September 30, 2021:

	Expected Future Payments
(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Transportation and Processing	$	181	$	745	$	689	$	493	$	429	$	2,334	$	4,871
Drilling and Field Services		32		44		24		24		24		-		148
Building Leases		3		10		6		6		6		2		33
Total	$	216	$	799	$	719	$	523	$	459	$	2,336	$	5,052

Operating leases with terms greater than one year are not included in the commitments table above. The table above includes short-term leases with contract terms less than 12 months, such as drilling rigs and field office leases, as well as non-lease operating cost components associated with building leases.

Included within transportation and processing in the table above are certain commitments associated with midstream service agreements with VMLP as described in Note 14. Divestiture transactions can reduce certain commitments disclosed above.

Contingencies

Ovintiv is involved in various legal claims and actions arising in the normal course of the Company’s operations. Although the outcome of these claims cannot be predicted with certainty, the Company does not expect these matters to have a material adverse effect on Ovintiv’s financial position, cash flows or results of operations. Management’s assessment of these matters may change in the future as certain of these matters are in early stages or are subject to a number of uncertainties. For material matters that the Company believes an unfavorable outcome is reasonably possible, the Company discloses the nature and a range of potential exposures. If an unfavorable outcome were to occur, there exists the possibility of a material impact on the Company’s consolidated net earnings or loss for the period in which the effect becomes reasonably estimable. The Company accrues for such items when a liability is both probable and the amount can be reasonably estimated. Such accruals are based on the Company’s information known about the matters, estimates of the outcomes of such matters and experience in handling similar matters.

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Basis of Presentation and Principles of Consolidation (Policies)

9 Months Ended

Sep. 30, 2021

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation and Principles of Consolidation

Ovintiv is in the business of the exploration for, the development of, and the production and marketing of oil, NGLs and natural gas.

The interim Condensed Consolidated Financial Statements include the accounts of Ovintiv and entities in which it holds a controlling interest. All intercompany balances and transactions are eliminated on consolidation. Undivided interests in oil and natural gas exploration and production joint ventures and partnerships are consolidated on a proportionate basis. Investments in non-controlled entities over which the Company has the ability to exercise significant influence are accounted for using the equity method.  

The interim Condensed Consolidated Financial Statements are prepared in conformity with U.S. GAAP and the rules and regulations of the SEC. Pursuant to these rules and regulations, certain information and disclosures normally required under U.S. GAAP have been condensed or have been disclosed on an annual basis only. Accordingly, the interim Condensed Consolidated Financial Statements should be read in conjunction with the annual audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2020, which are included in Item 8 of Ovintiv’s 2020 Annual Report on Form 10-K.

The interim Condensed Consolidated Financial Statements have been prepared following the same accounting policies and methods of computation as the annual audited Consolidated Financial Statements for the year ended December 31, 2020.

These unaudited interim Condensed Consolidated Financial Statements reflect, in the opinion of Management, all normal and recurring adjustments necessary to present fairly the financial position and results of the Company as at and for the periods presented. Interim condensed consolidated financial results are not necessarily indicative of consolidated financial results expected for the fiscal year.

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Segmented Information (Tables)

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segment and Geographic Information

Results of Operations (For the three months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	1,286		$	670		$	663		$	310	$	771		$	346
Gains (losses) on risk management, net		(265	)		38			(107	)		49		1			2
Sublease revenues		-			-			-			-		-			-
Total Revenues		1,021			708			556			359		772			348
Operating Expenses
Production, mineral and other taxes		75			43			2			4		-			-
Transportation and processing		122			109			231			203		44			53
Operating		122			104			25			24		5			5
Purchased product		-			-			-			-		759			322
Depreciation, depletion and amortization		207			299			83			99		-			-
Impairments		-			1,336			-			-		-			-
Total Operating Expenses		526			1,891			341			330		808			380
Operating Income (Loss)	$	495		$	(1,183	)	$	215		$	29	$	(36	)	$	(32	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	2,720		$	1,326
Gains (losses) on risk management, net		(579	)		(243	)		(950	)		(154	)
Sublease revenues		19			18			19			18
Total Revenues		(560	)		(225	)		1,789			1,190
Operating Expenses
Production, mineral and other taxes		-			-			77			47
Transportation and processing		-			-			397			365
Operating		1			-			153			133
Purchased product		-			-			759			322
Depreciation, depletion and amortization		7			8			297			406
Impairments		-			-			-			1,336
Accretion of asset retirement obligation		5			8			5			8
Administrative		101			79			101			79
Total Operating Expenses		114			95			1,789			2,696
Operating Income (Loss)	$	(674	)	$	(320	)		-			(1,506	)
Other (Income) Expenses
Interest								77			97
Foreign exchange (gain) loss, net								-			(25	)
Other (gains) losses, net								(6	)		(18	)
Total Other (Income) Expenses								71			54
Net Earnings (Loss) Before Income Tax								(71	)		(1,560	)
Income tax expense (recovery)								1			(39	)
Net Earnings (Loss)							$	(72	)	$	(1,521	)

Results of Operations (For the nine months ended September 30)

Segment and Geographic Information

	USA Operations						Canadian Operations					Market Optimization
	2021			2020			2021			2020		2021			2020
Revenues
Product and service revenues	$	3,459		$	1,900		$	1,810		$	906	$	2,171		$	1,113
Gains (losses) on risk management, net		(589	)		412			(164	)		188		3			5
Sublease revenues		-			-			-			-		-			-
Total Revenues		2,870			2,312			1,646			1,094		2,174			1,118
Operating Expenses
Production, mineral and other taxes		199			115			11			11		-			-
Transportation and processing		361			345			703			614		130			170
Operating		368			364			78			75		19			15
Purchased product		-			-			-			-		2,096			1,039
Depreciation, depletion and amortization		635			1,092			265			319		-			-
Impairments		-			4,863			-			-		-			-
Total Operating Expenses		1,563			6,779			1,057			1,019		2,245			1,224
Operating Income (Loss)	$	1,307		$	(4,467	)	$	589		$	75	$	(71	)	$	(106	)

	Corporate & Other						Consolidated
	2021			2020			2021			2020
Revenues
Product and service revenues	$	-		$	-		$	7,440		$	3,919
Gains (losses) on risk management, net		(1,426	)		(18	)		(2,176	)		587
Sublease revenues		55			53			55			53
Total Revenues		(1,371	)		35			5,319			4,559
Operating Expenses
Production, mineral and other taxes		-			-			210			126
Transportation and processing		-			-			1,194			1,129
Operating		1			(2	)		466			452
Purchased product		-			-			2,096			1,039
Depreciation, depletion and amortization		16			22			916			1,433
Impairments		-			-			-			4,863
Accretion of asset retirement obligation		17			26			17			26
Administrative		346			297			346			297
Total Operating Expenses		380			343			5,245			9,365
Operating Income (Loss)	$	(1,751	)	$	(308	)		74			(4,806	)
Other (Income) Expenses
Interest								263			279
Foreign exchange (gain) loss, net								(15	)		51
Other (gains) losses, net								(31	)		(48	)
Total Other (Income) Expenses								217			282
Net Earnings (Loss) Before Income Tax								(143	)		(5,088	)
Income tax expense (recovery)								(175	)		395
Net Earnings (Loss)							$	32		$	(5,483	)

Schedule of Marketing Intersegment Eliminations

Intersegment Information

							Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the three months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	2,705		$	1,445		$	(1,933	)	$	(1,097	)	$	772		$	348
Operating Expenses
Transportation and processing		141			148			(97	)		(95	)		44			53
Operating		5			5			-			-			5			5
Purchased product		2,596			1,324			(1,837	)		(1,002	)		759			322
Operating Income (Loss)	$	(37	)	$	(32	)	$	1		$	-		$	(36	)	$	(32	)

	Market Optimization
	Marketing Sales						Upstream Eliminations						Total
For the nine months ended September 30,	2021			2020			2021			2020			2021			2020
Revenues	$	7,486		$	4,587		$	(5,312	)	$	(3,469	)	$	2,174		$	1,118
Operating Expenses
Transportation and processing		427			468			(297	)		(298	)		130			170
Operating		19			15			-			-			19			15
Purchased product		7,111			4,210			(5,015	)		(3,171	)		2,096			1,039
Operating Income (Loss)	$	(71	)	$	(106	)	$	-		$	-		$	(71	)	$	(106	)

Capital Expenditures

Capital Expenditures

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
USA Operations	$	265	$	244	$	805	$	1,090
Canadian Operations		99		106		291		300
Corporate & Other		1		1		2		3
	$	365	$	351	$	1,098	$	1,393

Goodwill, Property, Plant and Equipment and Total Assets by Segment

Goodwill, Property, Plant and Equipment and Total Assets by Segment

	Goodwill					Property, Plant and Equipment					Total Assets
	As at					As at					As at
	September 30,		December 31,			September 30,		December 31,			September 30,		December 31,
	2021			2020		2021			2020		2021			2020
USA Operations	$	1,938		$	1,938	$	7,479		$	8,103	$	10,185		$	10,646
Canadian Operations		686			687		920			1,142		1,861			2,031
Market Optimization		-			-		-			2		293			233
Corporate & Other		-			-		191			203		1,297			1,559
	$	2,624		$	2,625	$	8,590		$	9,450	$	13,636		$	14,469

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Revenues from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2021

Disaggregation Of Revenue [Abstract]

Disaggregation of Revenue

Revenues (For the three months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	866	$	504	$	1	$	1	$	609	$	131
NGLs		250		98		303		139		8		-
Natural gas		172		71		360		172		150		210
Service revenues
Gathering and processing		-		-		1		-		-		-
Product and Service Revenues	$	1,288	$	673	$	665	$	312	$	767	$	341

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	1,476	$	636
NGLs		-		-		561		237
Natural gas		-		-		682		453
Service revenues
Gathering and processing		-		-		1		-
Product and Service Revenues	$	-	$	-	$	2,720	$	1,326

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

Revenues (For the nine months ended September 30)

	USA Operations				Canadian Operations				Market Optimization
	2021		2020		2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	2,468	$	1,453	$	7	$	5	$	1,596	$	500
NGLs		587		244		844		406		34		4
Natural gas		413		208		963		501		519		596
Service revenues
Gathering and processing		-		1		4		1		5		-
Product and Service Revenues	$	3,468	$	1,906	$	1,818	$	913	$	2,154	$	1,100

	Corporate & Other				Consolidated
	2021		2020		2021		2020
Revenues from Customers
Product revenues (1)
Oil	$	-	$	-	$	4,071	$	1,958
NGLs		-		-		1,465		654
Natural gas		-		-		1,895		1,305
Service revenues
Gathering and processing		-		-		9		2
Product and Service Revenues	$	-	$	-	$	7,440	$	3,919

(1) Includes revenues from production and revenues of product purchased from third parties, but excludes intercompany marketing fees transacted between the Company’s operating segments.

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Interest (Tables)

9 Months Ended

Sep. 30, 2021

Interest Expense [Abstract]

Schedule of Interest Expense

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Interest Expense on:
Debt	$	74	$	91	$	251	$	262
Finance leases		1		2		3		7
Other		2		4		9		10
	$	77	$	97	$	263	$	279

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Foreign Exchange (Gain) Loss, Net (Tables)

9 Months Ended

Sep. 30, 2021

Foreign Currency [Abstract]

Foreign Exchange (Gain) Loss, Net

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Unrealized Foreign Exchange (Gain) Loss on:
Translation of U.S. dollar financing debt issued from Canada	$	-		$	(6	)	$	1		$	56
Translation of U.S. dollar risk management contracts issued from Canada		14			(15	)		19			1
Translation of intercompany notes		-			-			-			(27	)
		14			(21	)		20			30
Foreign Exchange (Gain) Loss on Settlements of:
U.S. dollar financing debt issued from Canada		-			(2	)		(9	)		15
U.S. dollar risk management contracts issued from Canada		(7	)		(2	)		(25	)		7
Intercompany notes		(3	)		-			(3	)		3
Other Monetary Revaluations		(4	)		-			2			(4	)
	$	-		$	(25	)	$	(15	)	$	51

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Income Taxes (Tables)

9 Months Ended

Sep. 30, 2021

Income Tax Disclosure [Abstract]

Provision For Income Taxes

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Current Tax
United States	$	-		$	4		$	-		$	3
Canada		-			(1	)		(156	)		(1	)
Total Current Tax Expense (Recovery)		-			3			(156	)		2
Deferred Tax
United States		1			(41	)		1			(180	)
Canada		-			-			(20	)		573
Other Countries		-			(1	)		-			-
Total Deferred Tax Expense (Recovery)		1			(42	)		(19	)		393
Income Tax Expense (Recovery)	$	1		$	(39	)	$	(175	)	$	395
Effective Tax Rate		(1.4	%)		2.5	%		122.4	%		(7.8	%)

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Acquisitions and Divestitures (Tables)

9 Months Ended

Sep. 30, 2021

Acquisitions And Divestitures [Abstract]

Schedule of Net Acquisitions & (Divestitures)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2021		2020			2021			2020
Acquisitions
USA Operations	$	-	$	1		$	3		$	19
Total Acquisitions		-		1			3			19
Divestitures
USA Operations		7		(36	)		(767	)		(63	)
Canadian Operations		1		(3	)		(250	)		(6	)
Total Divestitures		8		(39	)		(1,017	)		(69	)
Net Acquisitions & (Divestitures)	$	8	$	(38	)	$	(1,014	)	$	(50	)

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Property, Plant and Equipment, Net (Tables)

9 Months Ended

Sep. 30, 2021

Property Plant And Equipment [Abstract]

Schedule Of Property, Plant And Equipment

	As at September 30, 2021							As at December 31, 2020
			Accumulated							Accumulated
	Cost		DD&A			Net		Cost		DD&A			Net
USA Operations
Proved properties	$	38,530	$	(33,217	)	$	5,313	$	37,875	$	(32,581	)	$	5,294
Unproved properties		2,153		-			2,153		2,785		-			2,785
Other		13		-			13		24		-			24
		40,696		(33,217	)		7,479		40,684		(32,581	)		8,103
Canadian Operations
Proved properties		16,154		(15,307	)		847		16,008		(15,056	)		952
Unproved properties		64		-			64		177		-			177
Other		9		-			9		13		-			13
		16,227		(15,307	)		920		16,198		(15,056	)		1,142
Market Optimization		7		(7	)		-		9		(7	)		2
Corporate & Other		868		(677	)		191		865		(662	)		203
	$	57,798	$	(49,208	)	$	8,590	$	57,756	$	(48,306	)	$	9,450

Schedule of Twelve Month Average Trailing Reserves Prices

The 12-month average trailing prices used in the ceiling test calculations were based on the benchmark prices presented below. The benchmark prices were adjusted for basis differentials to determine local reference prices, transportation costs and tariffs, heat content and quality.

	Oil & NGLs				Natural Gas
	WTI		Edmonton Condensate		Henry Hub		AECO
	($/bbl)		(C$/bbl)		($/MMBtu)		(C$/MMBtu)
12-Month Average Trailing Reserves Pricing (1)
September 30, 2021	$	57.69	$	72.45	$	2.94	$	2.79
December 31, 2020		39.62		49.77		1.98		2.13
September 30, 2020		43.69		53.93		1.97		2.01

(1) All prices were held constant in all future years when estimating net revenues and reserves.

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Leases (Tables)

9 Months Ended

Sep. 30, 2021

Leases [Abstract]

Schedule of Estimated Future Sublease Income

The following table outlines Ovintiv’s estimated future sublease income as at September 30, 2021. All subleases are classified as operating leases.

(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Sublease Income	$	13	$	48	$	46	$	46	$	46	$	521	$	720

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Long-Term Debt (Tables)

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Schedule Of Long-Term Debt

	As at			As at
	September 30,			December 31,
	2021			2020
U.S. Dollar Denominated Debt
Revolving credit and term loan borrowings	$	-		$	950
U.S. Unsecured Notes:
3.90% due November 15, 2021		-			518
5.75% due January 30, 2022		-			600
5.625% due July 1, 2024		1,000			1,000
5.375% due January 1, 2026		688			688
8.125% due September 15, 2030		300			300
7.20% due November 1, 2031		350			350
7.375% due November 1, 2031		500			500
6.50% due August 15, 2034		750			750
6.625% due August 15, 2037		462			462
6.50% due February 1, 2038		488			488
5.15% due November 15, 2041		203			203
Total Principal		4,741			6,809
Increase in Value of Debt Acquired		82			111
Unamortized Debt Discounts and Issuance Costs		(32	)		(35	)
Total Long-Term Debt	$	4,791		$	6,885
Current Portion	$	-		$	518
Long-Term Portion		4,791			6,367
	$	4,791		$	6,885

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Other Liabilities and Provisions (Tables)

9 Months Ended

Sep. 30, 2021

Other Liabilities Disclosure [Abstract]

Schedule of Other Liabilities and Provisions

	As at		As at
	September 30,		December 31,
	2021		2020
Finance Lease Obligations	$	35	$	39
Unrecognized Tax Benefits (See Note 6)		-		158
Pensions and Other Post-Employment Benefits		129		129
Long-Term Incentive Costs (See Note 16)		31		9
Other Derivative Contracts (See Notes 18, 19)		5		7
Other		15		16
	$	215	$	358

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Share Capital (Tables)

9 Months Ended

Sep. 30, 2021

Class Of Stock Disclosures [Abstract]

Schedule of Common Stock Issued and Outstanding

	As at September 30, 2021				As at December 31, 2020
	Number (millions)		Amount		Number (millions)		Amount
Shares of Common Stock Outstanding, Beginning of Year		259.8	$	3		259.8	$	7,061
Shares of Common Stock Issued (See Note 16)		1.3		-		-		-
Reclassification of Share Capital		-		-		-		(7,058	)
Shares of Common Stock Outstanding, End of Period		261.1	$	3		259.8	$	3

Earnings Per Common Share

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(US$ millions, except per share amounts)	2021			2020			2021		2020
Net Earnings (Loss)	$	(72	)	$	(1,521	)	$	32	$	(5,483	)
Number of Shares of Common Stock:
Weighted average shares of common stock outstanding - Basic		261.1			259.8			260.7		259.8
Effect of dilutive securities (1) (2)		-			-			4.6		-
Weighted Average Shares of Common Stock Outstanding - Diluted		261.1			259.8			265.3		259.8
Net Earnings (Loss) per Share of Common Stock
Basic	$	(0.28	)	$	(5.85	)	$	0.12	$	(21.10	)
Diluted (1) (2)		(0.28	)		(5.85	)		0.12		(21.10	)

(1) During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain Performance Share Units (“PSUs”) and Restricted Share Units (“RSUs”) with the issuance of the Company’s common stock. As a result, the stock-based compensation awards were modified and reclassified as equity-settled awards.

(2) For the three months ended September 30, 2021, all of Ovintiv’s equity-settled awards were determined to be antidilutive and therefore are excluded from the calculation of fully diluted net earnings (loss) per share of common stock.

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Accumulated Other Comprehensive Income (Tables)

9 Months Ended

Sep. 30, 2021

Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Foreign Currency Translation Adjustment
Balance, Beginning of Period	$	1,086		$	957		$	1,042		$	1,004
Change in Foreign Currency Translation Adjustment		(48	)		26			(4	)		(21	)
Balance, End of Period	$	1,038		$	983		$	1,038		$	983
Pension and Other Post-Employment Benefit Plans
Balance, Beginning of Period	$	31		$	43		$	34		$	42
Amounts Reclassified from Other Comprehensive Income:
Reclassification of net actuarial (gains) and losses to net earnings (See Note 17)		(1	)		(2	)		(5	)		(6	)
Income taxes		-			-			1			1
Curtailment in net defined periodic benefit cost (See Note 17)		-			-			-			5
Income taxes		-			-			-			(1	)
Balance, End of Period	$	30		$	41		$	30		$	41
Total Accumulated Other Comprehensive Income	$	1,068		$	1,024		$	1,068		$	1,024

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Restructuring Charges (Tables)

9 Months Ended

Sep. 30, 2021

Restructuring Charges [Abstract]

Restructuring Costs Expensed

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Severance and Benefits	$	2	$	6	$	13	$	86
Outplacement, Moving and Other Expenses		-		1		-		2
Restructuring Expenses	$	2	$	7	$	13	$	88

Schedule of Change in Restructuring Accrual

	As at			As at
	September 30,			December 31,
	2021			2020
Outstanding Restructuring Accrual, Beginning of Year	$	14		$	8
Restructuring Expenses Incurred		13			90
Restructuring Costs Paid		(24	)		(84	)
Outstanding Restructuring Accrual, End of Period (1)	$	3		$	14

(1) Included in accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheet.

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Compensation Plans (Tables)

9 Months Ended

Sep. 30, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Schedule of Weighted Average Assumptions Used to Fair Value Share Units

The following weighted average assumptions were used to determine the fair value of TSAR and SAR units outstanding:  

	As at September 30, 2021		As at September 30, 2020
	US$ SAR Share Units	C$ TSAR Share Units	US$ SAR Share Units	C$ TSAR Share Units
Risk Free Interest Rate	0.49%	0.49%	0.22%	0.22%
Dividend Yield	1.70%	1.68%	4.60%	4.66%
Expected Volatility Rate (1)	106.19%	105.03%	102.43%	101.65%
Expected Term	1.5 yrs	1.5 yrs	2.5 yrs	2.0 yrs
Market Share Price	US$32.88	C$41.62	US$8.16	C$10.89
Weighted Average Grant Date Fair Value	US$37.63	C$50.46	US$38.11	C$48.28

(1) Volatility was estimated using historical rates.

Amounts Recognized For Share-Based Payment Transactions

The Company has recognized the following share-based compensation costs:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Total Compensation Costs of Transactions Classified as Cash-Settled	$	33		$	4		$	115		$	(12	)
Total Compensation Costs of Transactions Classified as Equity-Settled		7			-			25			-
Less: Total Share-Based Compensation Costs Capitalized		(7	)		(2	)		(23	)		3
Total Share-Based Compensation Expense (Recovery)	$	33		$	2		$	117		$	(9	)
Recognized in the Condensed Consolidated Statement of Earnings in:
Operating	$	8		$	1		$	26		$	(3	)
Administrative		25			1			91			(6	)
	$	33		$	2		$	117		$	(9	)

Schedule of Share-based Compensation Activity

Nine Months Ended September 30, 2021 (thousands of units)
RSUs	2,748
PSUs	934
DSUs	14

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Pension and Other Post-Employment Benefits (Tables)

9 Months Ended

Sep. 30, 2021

General Discussion Of Pension And Other Postretirement Benefits [Abstract]

Total Benefit Plans Expense Recognized

The Company has recognized total benefit plans expense which includes pension benefits and other post-employment benefits (“OPEB”) for the nine months ended September 30 as follows:

	Pension Benefits				OPEB					Total
	2021		2020		2021			2020		2021			2020
Net Defined Periodic Benefit Cost	$	-	$	-	$	(2	)	$	2	$	(2	)	$	2
Defined Contribution Plan Expense		19		24		-			-		19			24
Total Benefit Plans Expense	$	19	$	24	$	(2	)	$	2	$	17		$	26

Schedule of Net Defined Periodic Benefit Cost

The net defined periodic benefit cost for the nine months ended September 30 is as follows:

	Defined Benefits						OPEB						Total
	2021			2020			2021			2020			2021			2020
Service Cost	$	-		$	-		$	3		$	3		$	3		$	3
Interest Cost		3			4			1			2			4			6
Expected Return on Plan Assets		(4	)		(5	)		-			-			(4	)		(5	)
Amounts Reclassified from Accumulated Other     Comprehensive Income:
Amortization of net actuarial (gains) and losses		1			1			(6	)		(7	)		(5	)		(6	)
Curtailment from net prior service costs		-			-			-			5			-			5
Curtailment		-			-			-			(1	)		-			(1	)
Total Net Defined Periodic Benefit Cost (1)	$	-		$	-		$	(2	)	$	2		$	(2	)	$	2

(1) The components of total net defined periodic benefit cost, excluding the service cost component, are included in other (gains) losses, net.

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Schedule Of Fair Value, Assets And Liabilities Measured On Recurring Basis

Fair value changes and settlements for amounts related to risk management assets and liabilities are recognized in revenues and foreign exchange gains and losses according to their purpose.

As at September 30, 2021	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	41	$	-	$	41	$	(41	)	$	-
Long-term assets		-		2		-		2		(2	)		-
Foreign Currency Derivatives:
Current assets		-		7		-		7		(6	)		1
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	4	$	1,163	$	298	$	1,465	$	(41	)	$	1,424
Long-term liabilities		-		211		37		248		(2	)		246
Foreign Currency Derivatives:
Current liabilities		-		-		-		-		(6	)		(6	)
Other Derivative Contracts (2)
Current in accounts receivable and accrued revenues	$	-	$	-	$	4	$	4	$	-		$	4
Long-term in other assets		-		-		5		5		-			5
Current in accounts payable and accrued liabilities		-		1		-		1		-			1
Long-term in other liabilities and provisions		-		5		-		5		-			5

As at December 31, 2020	Level 1 Quoted Prices in Active Markets		Level 2 Other Observable Inputs		Level 3 Significant Unobservable Inputs		Total Fair Value		Netting (1)			Carrying Amount
Risk Management Assets
Commodity Derivatives:
Current assets	$	-	$	70	$	-	$	70	$	(59	)	$	11
Long-term assets		-		7		-		7		(3	)		4
Foreign Currency Derivatives:
Current assets		-		26		-		26		-			26
Risk Management Liabilities
Commodity Derivatives:
Current liabilities	$	1	$	114	$	74	$	189	$	(59	)	$	130
Long-term liabilities		-		128		-		128		(3	)		125
Other Derivative Contracts (2)
Current in accounts payable and accrued liabilities	$	-	$	1	$	-	$	1	$	-		$	1
Long-term in other liabilities and provisions		-		7		-		7		-			7

(1) Netting to offset derivative assets and liabilities where the legal right and intention to offset exists, or where counterparty master netting arrangements contain provisions for net settlement.

(2) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

Summary Of Changes In Level 3 Fair Value Measurements

A summary of changes in Level 3 fair value measurements for risk management positions is presented below:

	Nine Months Ended
	September 30,
	2021			2020
Balance, Beginning of Year	$	(74	)	$	(52	)
Total Gains (Losses)		(637	)		214
Purchases, Sales, Issuances and Settlements:
Purchases, sales and issuances (1)		6			-
Settlements		379			(83	)
Transfers Out of Level 3		-			-
Balance, End of Period	$	(326	)	$	79
Change in Unrealized Gains (Losses) During the    Period Included in Net Earnings (Loss)	$	(258	)	$	131

(1) Relates to the contingent consideration associated with the Duvernay divestiture discussed in Note 7.

Quantitative Information About Unobservable Inputs Used In Level 3

Quantitative information about unobservable inputs used in Level 3 fair value measurements is presented below as at September 30, 2021:

	Valuation Technique	Unobservable Input	Range	Weighted Average (1)
Risk Management - WTI Options	Option Model	Implied Volatility	34% - 138%	48%

(1) Unobservable inputs were weighted by the relative fair value of the instruments.

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Financial Instruments and Risk Management (Tables)

9 Months Ended

Sep. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Risk Management Positions

	Notional Volumes	Term	Average Price		Fair Value
Crude Oil and NGL Contracts			US$/bbl
Fixed Price Contracts
WTI Fixed Price	30.0 Mbbls/d	2021		46.37	$	(77	)
WTI Fixed Price	5.0 Mbbls/d	2022		60.16		(18	)
Ethane Fixed Price	8.0 Mbbls/d	2021		11.05		(5	)
Propane Fixed Price	12.0 Mbbls/d	2021		25.78		(38	)
Butane Fixed Price	5.0 Mbbls/d	2021		24.83		(19	)
WTI Three-Way Options
Sold call / bought put / sold put	85.0 Mbbls/d	2021	53.92 / 44.66 / 34.79			(136	)
Sold call / bought put / sold put	75.0 Mbbls/d	2022	70.79 / 60.82 / 49.33			(164	)
WTI Costless Collars
Sold call / bought put	15.0 Mbbls/d	2021	45.84 / 35.00			(35	)
Basis Contracts (1)		2021				(4	)
		2022				(1	)
Other Crude Financial Positions						-
Crude Oil and NGLs Fair Value Position						(497	)
Natural Gas Contracts			US$/Mcf
Fixed Price Contracts
NYMEX Fixed Price	165 MMcf/d	2021		2.51		(52	)
NYMEX Fixed Price	200 MMcf/d	2022		2.67		(125	)
NYMEX Fixed Price Swaptions (2)	165 MMcf/d	2022		2.51		(113	)
NYMEX Three-Way Options
Sold call / bought put / sold put	980 MMcf/d	2021	3.36 / 2.89 / 2.50			(230	)
Sold call / bought put / sold put	398 MMcf/d	2022	3.02 / 2.75 / 2.00			(205	)
NYMEX Costless Collars
Sold call / bought put	200 MMcf/d	2022	2.85 / 2.55			(116	)
NYMEX Call Options
Sold call	330 MMcf/d	2022		2.38		(244	)
Basis Contracts (3)		2021				(9	)
		2022				(29	)
		2023 - 2025				(34	)
Other Financial Positions						(16	)
Natural Gas Fair Value Position						(1,173	)
Other Derivative Contracts
Fair Value Position (4)						3
Foreign Currency Contracts
Fair Value Position (5)		2021 - 2022				7
Total Fair Value Position					$	(1,660	)

(1) Ovintiv has entered into crude and NGL differential swaps associated with Canadian condensate and WTI.

(2) NYMEX Fixed Price Swaptions give the counterparty the option to extend certain 2021 Fixed Price swaps to 2022.

(3) Ovintiv has entered into natural gas basis swaps associated with AECO, Dawn, Malin, Waha, Houston Ship Channel and NYMEX.

(4) Includes credit derivatives and contingent consideration associated with certain previous and current year divestitures, respectively.

(5) Ovintiv has entered into U.S. dollar denominated fixed-for-floating average currency swaps to protect against fluctuations between the Canadian and U.S. dollars.

Earnings Impact of Realized and Unrealized Gains (Losses) on Risk Management Positions

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Realized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (1)	$	(371	)	$	89		$	(750	)	$	605
Foreign Currency Derivatives:
Foreign exchange		7			2			25			(7	)
	$	(364	)	$	91		$	(725	)	$	598
Unrealized Gains (Losses) on Risk Management
Commodity and Other Derivatives:
Revenues (2)	$	(579	)	$	(243	)	$	(1,426	)	$	(18	)
Foreign Currency Derivatives:
Foreign exchange		(11	)		15			(19	)		(1	)
	$	(590	)	$	(228	)	$	(1,445	)	$	(19	)
Total Realized and Unrealized Gains (Losses) on Risk Management, net
Commodity and Other Derivatives:
Revenues (1) (2)	$	(950	)	$	(154	)	$	(2,176	)	$	587
Foreign Currency Derivatives:
Foreign exchange		(4	)		17			6			(8	)
	$	(954	)	$	(137	)	$	(2,170	)	$	579

(1) Includes realized gains of nil and $1 million for the three and nine months ended September 30, 2021, respectively (2020 - gains of nil and $2 million, respectively), related to other derivative contracts.

(2) Includes unrealized gains of $1 million and $4 million for the three and nine months ended September 30, 2021, respectively (2020 - losses of nil and $4 million, respectively), related to other derivative contracts.

Reconciliation of Unrealized Risk Management Positions

	2021						2020
	Fair Value			Total Unrealized Gain (Loss)			Total Unrealized Gain (Loss)
Fair Value of Contracts, Beginning of Year	$	(222	)
Change in Fair Value of Contracts in Place at Beginning of Year    and Contracts Entered into During the Period		(2,170	)	$	(2,170	)	$	579
Settlement of Other Derivative Contracts		1
Fair Value of Other Derivative Contract Assets Entered into    During the Period (See Note 7)		6
Fair Value of Contracts Realized During the Period		725			725			(598	)
Fair Value of Contracts, End of Period	$	(1,660	)	$	(1,445	)	$	(19	)

Unrealized Risk Management Positions

	As at			As at
	September 30,			December 31,
	2021			2020
Risk Management Assets
Current	$	1		$	37
Long-term		-			4
		1			41
Risk Management Liabilities
Current		1,418			130
Long-term		246			125
		1,664			255
Other Derivative Contract Assets
Current in accounts receivable and accrued revenues		4			-
Long-term in other assets		5			-
		9			-
Other Derivative Contract Liabilities
Current in accounts payable and accrued liabilities		1			1
Long-term in other liabilities and provisions		5			7
		6			8
Net Risk Management Assets (Liabilities) and Other Derivative Contracts	$	(1,660	)	$	(222	)

XML

Supplementary Information (Tables)

9 Months Ended

Sep. 30, 2021

Supplemental Cash Flow Elements [Abstract]

Net Change in Non-Cash Working Capital

A) Net Change in Non-Cash Working Capital

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Operating Activities
Accounts receivable and accrued revenues	$	(25	)	$	78		$	(287	)	$	289
Accounts payable and accrued liabilities		13			42			211			(212	)
Current portion of operating lease liabilities		(9	)		(4	)		(5	)		(10	)
Income tax receivable and payable		(2	)		26			23			39
	$	(23	)	$	142		$	(58	)	$	106

Non-Cash Activities

B) Non-Cash Activities

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
Non-Cash Operating Activities
ROU operating lease assets and liabilities	$	(4	)	$	(5	)	$	(22	)	$	(6	)
Non-Cash Investing Activities
Asset retirement obligation incurred	$	-		$	2		$	-		$	11
Asset retirement obligation change in estimated future cash outflows		-			(10	)		-			12
Property, plant and equipment accruals		4			68			(33	)		(62	)
Capitalized long-term incentives		5			2			12			(7	)
Property additions/dispositions (swaps)		18			212			24			229
Contingent consideration (See Note 7)		-			-			6			-

XML

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments

The following table outlines the Company’s commitments as at September 30, 2021:

	Expected Future Payments
(undiscounted)	2021		2022		2023		2024		2025		Thereafter		Total
Transportation and Processing	$	181	$	745	$	689	$	493	$	429	$	2,334	$	4,871
Drilling and Field Services		32		44		24		24		24		-		148
Building Leases		3		10		6		6		6		2		33
Total	$	216	$	799	$	719	$	523	$	459	$	2,336	$	5,052

XML

Segmented Information (Segment and Geographical Information) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Segment Reporting Information [Line Items]
Product and service revenues	$ 2,720	$ 1,326	$ 7,440	$ 3,919
Gains (losses) on risk management, net	(950)	(154)	(2,176)	587
Sublease revenues	19	18	55	53
Total Revenues	1,789	1,190	5,319	4,559
Production, mineral and other taxes	77	47	210	126
Transportation and processing	397	365	1,194	1,129
Operating	153	133	466	452
Purchased product	759	322	2,096	1,039
Depreciation, depletion and amortization	297	406	916	1,433
Impairments	0	1,336	0	4,863
Accretion of asset retirement obligation	5	8	17	26
Administrative	101	79	346	297
Total Operating Expenses	1,789	2,696	5,245	9,365
Operating Income (Loss)	0	(1,506)	74	(4,806)
Interest	77	97	263	279
Foreign exchange (gain) loss, net	0	(25)	(15)	51
Other (gains) losses, net	(6)	(18)	(31)	(48)
Total Other (Income) Expenses	71	54	217	282
Net Earnings (Loss) Before Income Tax	(71)	(1,560)	(143)	(5,088)
Income tax expense (recovery)	1	(39)	(175)	395
Net Earnings (Loss)	(72)	(1,521)	32	(5,483)
Corporate & Other [Member]
Segment Reporting Information [Line Items]
Product and service revenues	0	0	0	0
Gains (losses) on risk management, net	(579)	(243)	(1,426)	(18)
Sublease revenues	19	18	55	53
Total Revenues	(560)	(225)	(1,371)	35
Production, mineral and other taxes	0	0	0	0
Transportation and processing	0	0	0	0
Operating	1	0	1	(2)
Purchased product	0	0	0	0
Depreciation, depletion and amortization	7	8	16	22
Impairments	0	0	0	0
Accretion of asset retirement obligation	5	8	17	26
Administrative	101	79	346	297
Total Operating Expenses	114	95	380	343
Operating Income (Loss)	(674)	(320)	(1,751)	(308)
USA Operations [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Product and service revenues	1,286	670	3,459	1,900
Gains (losses) on risk management, net	(265)	38	(589)	412
Sublease revenues	0	0	0	0
Total Revenues	1,021	708	2,870	2,312
Production, mineral and other taxes	75	43	199	115
Transportation and processing	122	109	361	345
Operating	122	104	368	364
Purchased product	0	0	0	0
Depreciation, depletion and amortization	207	299	635	1,092
Impairments	0	1,336	0	4,863
Total Operating Expenses	526	1,891	1,563	6,779
Operating Income (Loss)	495	(1,183)	1,307	(4,467)
Canadian Operations [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Product and service revenues	663	310	1,810	906
Gains (losses) on risk management, net	(107)	49	(164)	188
Sublease revenues	0	0	0	0
Total Revenues	556	359	1,646	1,094
Production, mineral and other taxes	2	4	11	11
Transportation and processing	231	203	703	614
Operating	25	24	78	75
Purchased product	0	0	0	0
Depreciation, depletion and amortization	83	99	265	319
Impairments	0	0	0	0
Total Operating Expenses	341	330	1,057	1,019
Operating Income (Loss)	215	29	589	75
Market Optimization [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Product and service revenues	771	346	2,171	1,113
Gains (losses) on risk management, net	1	2	3	5
Sublease revenues	0	0	0	0
Total Revenues	772	348	2,174	1,118
Production, mineral and other taxes	0	0	0	0
Transportation and processing	44	53	130	170
Operating	5	5	19	15
Purchased product	759	322	2,096	1,039
Depreciation, depletion and amortization	0	0	0	0
Impairments	0	0	0	0
Total Operating Expenses	808	380	2,245	1,224
Operating Income (Loss)	$ (36)	$ (32)	$ (71)	$ (106)

XML

Segmented Information (Schedule of Marketing Intersegment Eliminations) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Product Information [Line Items]
Revenues	$ 1,789	$ 1,190	$ 5,319	$ 4,559
Transportation and processing	397	365	1,194	1,129
Operating	153	133	466	452
Purchased product	759	322	2,096	1,039
Operating Income (Loss)	0	(1,506)	74	(4,806)
Market Optimization [Member] | Operating Segments [Member]
Product Information [Line Items]
Revenues	772	348	2,174	1,118
Transportation and processing	44	53	130	170
Operating	5	5	19	15
Purchased product	759	322	2,096	1,039
Operating Income (Loss)	(36)	(32)	(71)	(106)
Market Optimization [Member] | Reportable Subsegments [Member] | Marketing Sales [Member]
Product Information [Line Items]
Revenues	2,705	1,445	7,486	4,587
Transportation and processing	141	148	427	468
Operating	5	5	19	15
Purchased product	2,596	1,324	7,111	4,210
Operating Income (Loss)	(37)	(32)	(71)	(106)
Market Optimization [Member] | Intersubsegment Eliminations [Member]
Product Information [Line Items]
Revenues	(1,933)	(1,097)	(5,312)	(3,469)
Transportation and processing	(97)	(95)	(297)	(298)
Operating	0	0	0	0
Purchased product	(1,837)	(1,002)	(5,015)	(3,171)
Operating Income (Loss)	$ 1	$ 0	$ 0	$ 0

XML

Segmented Information (Capital Expenditures) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Segment Reporting Information [Line Items]
Capital Expenditures	$ 365	$ 351	$ 1,098	$ 1,393
Operating Segments [Member] | USA Operations [Member]
Segment Reporting Information [Line Items]
Capital Expenditures	265	244	805	1,090
Operating Segments [Member] | Canadian Operations [Member]
Segment Reporting Information [Line Items]
Capital Expenditures	99	106	291	300
Corporate & Other [Member]
Segment Reporting Information [Line Items]
Capital Expenditures	$ 1	$ 1	$ 2	$ 3

XML

Segmented Information (Goodwill, Property, Plant and Equipment and Total Assets by Segment) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	$ 2,624	$ 2,625
Property, Plant and Equipment	8,590	9,450
Total Assets	13,636	14,469
Operating Segments [Member] | USA Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	1,938	1,938
Property, Plant and Equipment	7,479	8,103
Total Assets	10,185	10,646
Operating Segments [Member] | Canadian Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	686	687
Property, Plant and Equipment	920	1,142
Total Assets	1,861	2,031
Operating Segments [Member] | Market Optimization [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	0	0
Property, Plant and Equipment	0	2
Total Assets	293	233
Corporate & Other [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	0	0
Property, Plant and Equipment	191	203
Total Assets	$ 1,297	$ 1,559

XML

Revenues from Contracts with Customers (Disaggregation of Revenue) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Disaggregation of Revenue [Line Items]
Product revenues	$ 2,720	$ 1,326	$ 7,440	$ 3,919
Operating Segments [Member] | USA Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	1,288	673	3,468	1,906
Operating Segments [Member] | Canadian Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	665	312	1,818	913
Operating Segments [Member] | Market Optimization Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	767	341	2,154	1,100
Corporate & Other [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	0	0
Oil [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	1,476	636	4,071	1,958
Oil [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | USA Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	866	504	2,468	1,453
Oil [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Canadian Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	1	1	7	5
Oil [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Market Optimization Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	609	131	1,596	500
Oil [Member] | Corporate & Other [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	0	0
Natural Gas Liquids [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	561	237	1,465	654
Natural Gas Liquids [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | USA Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	250	98	587	244
Natural Gas Liquids [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Canadian Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	303	139	844	406
Natural Gas Liquids [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Market Optimization Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	8	0	34	4
Natural Gas Liquids [Member] | Corporate & Other [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	0	0
Natural Gas [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	682	453	1,895	1,305
Natural Gas [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | USA Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	172	71	413	208
Natural Gas [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Canadian Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	360	172	963	501
Natural Gas [Member] | Operating Segments [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member] | Market Optimization Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	150	210	519	596
Natural Gas [Member] | Corporate & Other [Member] | Product Revenues Including Sale of Product Purchased from Third Parties [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	0	0
Natural Gas Gathering and Processing [Member]
Disaggregation of Revenue [Line Items]
Product revenues	1	0	9	2
Natural Gas Gathering and Processing [Member] | Operating Segments [Member] | USA Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	0	1
Natural Gas Gathering and Processing [Member] | Operating Segments [Member] | Canadian Operations Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	1	0	4	1
Natural Gas Gathering and Processing [Member] | Operating Segments [Member] | Market Optimization Excluding Intercompany Segment Transactions [Member]
Disaggregation of Revenue [Line Items]
Product revenues	0	0	5	0
Natural Gas Gathering and Processing [Member] | Corporate & Other [Member]
Disaggregation of Revenue [Line Items]
Product revenues	$ 0	$ 0	$ 0	$ 0

XML

Revenues from Contracts with Customers (Narrative) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Revenue From Contract With Customer [Abstract]
Contract with customer, asset net	$ 0	$ 0
Contract with customer, liability	0	0
Receivables & accrued revenues from contracts with customers	1,110	$ 814
Revenue, remaining performance obligation	$ 0

XML

Interest (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Interest Expense [Abstract]
Interest Expense on Debt	$ 74	$ 91	$ 251	$ 262
Interest on Finance Leases	1	2	3	7
Interest - Other	2	4	9	10
Interest	$ 77	$ 97	$ 263	$ 279

XML

Interest (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Schedule Of Interest Expense [Line Items]
Interest expense on debt	$ 74	$ 91	$ 251	$ 262
5.75% Senior Notes [Member] | Senior Notes, Due January 30, 2022 [Member]
Schedule Of Interest Expense [Line Items]
Interest expense on debt			$ 19
Debt instrument interest rate stated percentage	5.75%		5.75%
Debt instrument maturity date			Jan. 30, 2022
Debt instrument repurchased face amount	$ 600		$ 600

XML

Foreign Exchange (Gain) Loss, Net (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Schedule Of Foreign Exchange Transactions [Line Items]
Unrealized Foreign Exchange (Gain) Loss	$ 14	$ (21)	$ 20	$ 30
Foreign Exchange (Gain) Loss, Net	0	(25)	(15)	51
Translation of U.S. Dollar Debt Issued From Canada [Member]
Schedule Of Foreign Exchange Transactions [Line Items]
Unrealized Foreign Exchange (Gain) Loss	0	(6)	1	56
Foreign Exchange on Settlements	0	(2)	(9)	15
Translation of U.S. Dollar Risk Management Contracts Issued From Canada [Member]
Schedule Of Foreign Exchange Transactions [Line Items]
Unrealized Foreign Exchange (Gain) Loss	14	(15)	19	1
Foreign Exchange on Settlements	(7)	(2)	(25)	7
Translation of Intercompany Notes [Member]
Schedule Of Foreign Exchange Transactions [Line Items]
Unrealized Foreign Exchange (Gain) Loss	0	0	0	(27)
Foreign Exchange on Settlements	(3)	0	(3)	3
Other Monetary Revaluations [Member]
Schedule Of Foreign Exchange Transactions [Line Items]
Foreign Exchange on Settlements	$ (4)	$ 0	$ 2	$ (4)

XML

Income Taxes (Provision For Income Taxes) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Total Current Tax Expense (Recovery)	$ 0	$ 3	$ (156)	$ 2
Total Deferred Tax Expense (Recovery)	1	(42)	(19)	393
Income Tax Expense (Recovery)	$ 1	$ (39)	$ (175)	$ 395
Effective Tax Rate	(1.40%)	2.50%	122.40%	(7.80%)
United States [Member]
Total Current Tax Expense (Recovery)	$ 0	$ 4	$ 0	$ 3
Total Deferred Tax Expense (Recovery)	1	(41)	1	(180)
Canada [Member]
Total Current Tax Expense (Recovery)	0	(1)	(156)	(1)
Total Deferred Tax Expense (Recovery)	0	0	(20)	573
Other Countries [Member]
Total Deferred Tax Expense (Recovery)	$ 0	$ (1)	$ 0	$ 0

XML

Income Taxes (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Income Tax Disclosure [Line Items]
Reduction of unrecognized tax benefits			$ 222
Increase (Reduction) in valuation allowance			$ (66)
Effective Tax Rate	(1.40%)	2.50%	122.40%	(7.80%)
Canada [Member]
Income Tax Disclosure [Line Items]
Increase (Reduction) in valuation allowance				$ 568
United States [Member]
Income Tax Disclosure [Line Items]
Statutory Tax Rate			21.00%	21.00%
Other (Gains) Losses, Net [Member]
Income Tax Disclosure [Line Items]
Interest income			$ 12

XML

Acquisitions and Divestitures (Schedule of Net Acquisitions & (Divestitures)) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Acquisitions and Divestitures [Line Items]
Acquisitions	$ 0	$ 1	$ 3	$ 19
Divestitures	8	(39)	(1,017)	(69)
Net Acquisitions and Divestitures	8	(38)	(1,014)	(50)
Operating Segments [Member] | USA Operations [Member]
Acquisitions and Divestitures [Line Items]
Acquisitions	0	1	3	19
Divestitures	7	(36)	(767)	(63)
Operating Segments [Member] | Canadian Operations [Member]
Acquisitions and Divestitures [Line Items]
Divestitures	$ 1	$ (3)	$ (250)	$ (6)

XML

Acquisitions and Divestitures (Narrative) (Details) $ in Millions, $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Dec. 31, 2022 CAD ($) $ / bbl	Dec. 31, 2021 CAD ($) $ / bbl	Apr. 28, 2021 USD ($)
Acquisitions and Divestitures [Line Items]
Acquisitions	$ 0	$ 1	$ 3	$ 19
Divestitures	(8)	39	1,017	69
Duvernay Assets [Member]
Acquisitions and Divestitures [Line Items]
Embedded derivative, fair value							$ 6
Duvernay Assets [Member] | Scenario Forecast [Member]
Acquisitions and Divestitures [Line Items]
Contingent consideration receivable					$ 10	$ 5
Duvernay Assets [Member] | WTI [Member] | Minimum [Member] | Scenario Forecast [Member]
Acquisitions and Divestitures [Line Items]
Reference Price | $ / bbl					62	56
USA Operations [Member] | Operating Segments [Member]
Acquisitions and Divestitures [Line Items]
Acquisitions	0	1	3	19
Divestitures	(7)	36	767	63
USA Operations [Member] | Operating Segments [Member] | Eagle Ford Assets [Member]
Acquisitions and Divestitures [Line Items]
Divestitures			762
Canadian Operations [Member] | Operating Segments [Member]
Acquisitions and Divestitures [Line Items]
Divestitures	$ (1)	$ 3	250	$ 6
Canadian Operations [Member] | Operating Segments [Member] | Duvernay Assets [Member]
Acquisitions and Divestitures [Line Items]
Divestitures			$ 238

XML

Property, Plant and Equipment, Net (Schedule Of Property, Plant And Equipment) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	$ 57,798	$ 57,756
Less: Accumulated depreciation, depletion and amortization	(49,208)	(48,306)
Property, plant and equipment, net	8,590	9,450
Operating Segments [Member] | USA Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	40,696	40,684
Less: Accumulated depreciation, depletion and amortization	(33,217)	(32,581)
Property, plant and equipment, net	7,479	8,103
Operating Segments [Member] | Canadian Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	16,227	16,198
Less: Accumulated depreciation, depletion and amortization	(15,307)	(15,056)
Property, plant and equipment, net	920	1,142
Operating Segments [Member] | Market Optimization [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, net	0	2
Corporate & Other [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, net	191	203
Proved Properties [Member] | Operating Segments [Member] | USA Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	38,530	37,875
Less: Accumulated depreciation, depletion and amortization	(33,217)	(32,581)
Property, plant and equipment, net	5,313	5,294
Proved Properties [Member] | Operating Segments [Member] | Canadian Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	16,154	16,008
Less: Accumulated depreciation, depletion and amortization	(15,307)	(15,056)
Property, plant and equipment, net	847	952
Unproved Properties [Member] | Operating Segments [Member] | USA Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	2,153	2,785
Less: Accumulated depreciation, depletion and amortization	0	0
Property, plant and equipment, net	2,153	2,785
Unproved Properties [Member] | Operating Segments [Member] | Canadian Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	64	177
Less: Accumulated depreciation, depletion and amortization	0	0
Property, plant and equipment, net	64	177
Other Capitalized Property Plant and Equipment [Member] | Operating Segments [Member] | USA Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	13	24
Less: Accumulated depreciation, depletion and amortization	0	0
Property, plant and equipment, net	13	24
Other Capitalized Property Plant and Equipment [Member] | Operating Segments [Member] | Canadian Operations [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	9	13
Less: Accumulated depreciation, depletion and amortization	0	0
Property, plant and equipment, net	9	13
Other Capitalized Property Plant and Equipment [Member] | Operating Segments [Member] | Market Optimization [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	7	9
Less: Accumulated depreciation, depletion and amortization	(7)	(7)
Property, plant and equipment, net	0	2
Other Capitalized Property Plant and Equipment [Member] | Corporate & Other [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Cost	868	865
Less: Accumulated depreciation, depletion and amortization	(677)	(662)
Property, plant and equipment, net	$ 191	$ 203

XML

Property, Plant and Equipment, Net (Narrative) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Property, Plant and Equipment [Line Items]
Internal Costs Capitalized			$ 124,000,000	$ 133,000,000
Operating Segments [Member] | USA Operations [Member]
Property, Plant and Equipment [Line Items]
Impairment	$ 0	$ 1,336,000,000	0	4,863,000,000
Operating Segments [Member] | Canadian Operations [Member]
Property, Plant and Equipment [Line Items]
Impairment	$ 0	$ 0	$ 0	$ 0

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Property, Plant and Equipment, Net (Schedule of Twelve Month Average Trailing Reserves Prices) (Details)		9 Months Ended		12 Months Ended
		Sep. 30, 2021 $ / bbl $ / bbl $ / MMBTU $ / MMBTU	Sep. 30, 2020 $ / bbl $ / bbl $ / MMBTU $ / MMBTU	Dec. 31, 2020 $ / bbl $ / bbl $ / MMBTU $ / MMBTU
Oil and NGLs [Member] | WTI [Member]
Property, Plant and Equipment [Line Items]
12-Month Average Trailing Reserves Pricing | $ / bbl	[1]	57.69	43.69	39.62
Oil and NGLs [Member] | Edmonton Condensate [Member]
Property, Plant and Equipment [Line Items]
12-Month Average Trailing Reserves Pricing | $ / bbl	[1]	72.45	53.93	49.77
Natural Gas [Member] | Henry Hub [Member]
Property, Plant and Equipment [Line Items]
12-Month Average Trailing Reserves Pricing | $ / MMBTU	[1]	2.94	1.97	1.98
Natural Gas [Member] | AECO [Member]
Property, Plant and Equipment [Line Items]
12-Month Average Trailing Reserves Pricing | $ / MMBTU	[1]	2.79	2.01	2.13

[1] All prices were held constant in all future years when estimating net revenues and reserves

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Leases (Schedule of Estimated Future Sublease Income) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2021 USD ($)
Leases [Abstract]
2021	$ 13
2022	48
2023	46
2024	46
2025	46
Thereafter	521
Total	$ 720

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Leases (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Leases [Abstract]
Operating lease income	$ 15	$ 14	$ 42	$ 40
Variable lease income	$ 4	$ 4	$ 13	$ 13

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Long-Term Debt (Schedule Of Long-Term Debt) (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Revolving credit and term loan borrowings	$ 0	$ 950
Total Principal	4,741	6,809
Increase in Value of Debt Acquired	82	111
Unamortized Debt Discounts and Issuance Costs	(32)	(35)
Total Long-Term Debt	4,791	6,885
Current Portion	0	518
Long-Term Debt	4,791	6,367
3.90% Unsecured Notes [Member] | Unsecured Notes, Due November 15, 2021 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 0	$ 518
Debt Instrument, Interest Rate, Stated Percentage	3.90%	3.90%
Debt Instrument, Maturity Date	Nov. 15, 2021	Nov. 15, 2021
5.75% Unsecured Notes [Member] | Unsecured Notes, Due January 30, 2022 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 0	$ 600
Debt Instrument, Interest Rate, Stated Percentage	5.75%	5.75%
Debt Instrument, Maturity Date	Jan. 30, 2022	Jan. 30, 2022
5.625% Unsecured Notes [Member] | Unsecured Notes, Due July 1, 2024 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 1,000	$ 1,000
Debt Instrument, Interest Rate, Stated Percentage	5.625%	5.625%
Debt Instrument, Maturity Date	Jul. 01, 2024	Jul. 01, 2024
5.375% Unsecured Notes [Member] | Unsecured Notes, Due Jan 1, 2026 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 688	$ 688
Debt Instrument, Interest Rate, Stated Percentage	5.375%	5.375%
Debt Instrument, Maturity Date	Jan. 01, 2026	Jan. 01, 2026
8.125% Unsecured Notes [Member] | Unsecured Notes, Due September 15, 2030 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 300	$ 300
Debt Instrument, Interest Rate, Stated Percentage	8.125%	8.125%
Debt Instrument, Maturity Date	Sep. 15, 2030	Sep. 15, 2030
7.20% Unsecured Notes [Member] | Unsecured Notes, Due November 1, 2031 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 350	$ 350
Debt Instrument, Interest Rate, Stated Percentage	7.20%	7.20%
Debt Instrument, Maturity Date	Nov. 01, 2031	Nov. 01, 2031
7.375% Unsecured Notes [Member] | Unsecured Notes, Due November 1, 2031 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 500	$ 500
Debt Instrument, Interest Rate, Stated Percentage	7.375%	7.375%
Debt Instrument, Maturity Date	Nov. 01, 2031	Nov. 01, 2031
6.50% Unsecured Notes [Member] | Unsecured Notes, Due August 15, 2034 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 750	$ 750
Debt Instrument, Interest Rate, Stated Percentage	6.50%	6.50%
Debt Instrument, Maturity Date	Aug. 15, 2034	Aug. 15, 2034
6.50% Unsecured Notes [Member] | Unsecured Notes, Due February 1, 2038 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 488	$ 488
Debt Instrument, Interest Rate, Stated Percentage	6.50%	6.50%
Debt Instrument, Maturity Date	Feb. 01, 2038	Feb. 01, 2038
6.625% Unsecured Notes [Member] | Unsecured Notes, Due August 15, 2037 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 462	$ 462
Debt Instrument, Interest Rate, Stated Percentage	6.625%	6.625%
Debt Instrument, Maturity Date	Aug. 15, 2037	Aug. 15, 2037
5.15% Unsecured Notes [Member] | Unsecured Notes, Due November 15, 2041 [Member]
Debt Instrument [Line Items]
Unsecured Debt	$ 203	$ 203
Debt Instrument, Interest Rate, Stated Percentage	5.15%	5.15%
Debt Instrument, Maturity Date	Nov. 15, 2041	Nov. 15, 2041

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Long-Term Debt (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Debt Instrument [Line Items]
Principal amount of repurchased senior notes		$ 115		$ 252
Aggregate cash payment for repurchased debt	$ 518	109	$ 1,137	224
One-time make-whole payment included in interest expense	74	91	251	262
Recognized net gain on debt		$ 6		$ 28
Long-term debt carrying value	4,791		4,791		$ 6,885
Long-term debt, fair value	$ 5,989		$ 5,989		$ 7,379
5.75% Unsecured Notes [Member] | Unsecured Notes, Due January 30, 2022 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate stated percentage	5.75%		5.75%		5.75%
Debt instrument maturity date			Jan. 30, 2022		Jan. 30, 2022
Principal amount of repurchased senior notes			$ 600
Aggregate cash payment for repurchased debt			632
One-time make-whole payment included in interest expense			19
Accrued and unpaid interest			$ 13
3.90% Unsecured Notes [Member] | Unsecured Notes, Due November 15, 2021 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate stated percentage	3.90%		3.90%		3.90%
Debt instrument maturity date			Nov. 15, 2021		Nov. 15, 2021
Principal amount of repurchased senior notes	$ 518		$ 518
Aggregate cash payment for repurchased debt	523		523
Accrued and unpaid interest	$ 5		$ 5

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Other Liabilities and Provisions (Schedule of Other Liabilities and Provisions) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Other Liabilities And Provisions [Line Items]
Obligation under Finance Lease	$ 35	$ 39
Pensions and Other Post-Employment Benefits	129	129
Long-Term Incentives	31	9
Other Derivative Contracts, Liabilities	6	8
Other	15	16
Other Liabilities and Provisions	215	358
Other Liabilities and Provisions [Member]
Other Liabilities And Provisions [Line Items]
Unrecognized Tax Benefits	0	158
Other Derivative Contracts, Liabilities	$ 5	$ 7

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Share Capital (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended		9 Months Ended
	Nov. 02, 2021	Jan. 24, 2020	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Sep. 28, 2021
Class Of Stock [Line Items]
Common stock, shares authorized			750,000,000		750,000,000
Common stock, par value		$ 0.01	$ 0.01		$ 0.01
Preferred stock, shares authorized			25,000,000		25,000,000
Preferred stock, par value			$ 0.01		$ 0.01
Dividends on Common Shares			$ 37	$ 24	$ 86	$ 73
Common Stock, Dividends, Per Share, Paid			$ 0.14	$ 0.09375	$ 0.3275	$ 0.28125
Common Stock, Dividends, Per Share, Declared			$ 0.14	$ 0.09375	$ 0.3275	$ 0.28125
Subsequent Event [Member]
Class Of Stock [Line Items]
Dividends Payable, Date Declared	Nov. 02, 2021
Common Stock, Dividends, Per Share, Declared	$ 0.14
Dividends Payable, Date to be Paid	Dec. 31, 2021
Dividends Payable, Date of Record	Dec. 15, 2021
Normal Course Issuer Bid [Member] | Maximum [Member]
Class Of Stock [Line Items]
Stock Repurchase Program, Number of Shares Authorized to be Repurchased							26,000,000.0
Share Capital [Member]
Class Of Stock [Line Items]
Reclassification of share capital due to reorganization and domestication		$ (7,058)
Dividends on Common Shares				$ 0	$ 0	$ 0

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Share Capital (Schedule of Common Stock Issued and Outstanding) (Details) - USD ($) shares in Millions, $ in Millions	9 Months Ended		12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Class Of Stock [Line Items]
Shares of Common Stock Outstanding, Beginning of Year	259.8	259.8	259.8
Shares of Common Stock Issued (See Note 16)	1.3		0.0
Reclassification of Share Capital		$ 0
Shares of Common Stock Outstanding, End of Period	261.1		259.8
Shares of Common Stock Outstanding, Beginning of Year	$ 3	7,061	$ 7,061
Shares of Common Stock Issued (See Note 16)	0		0
Shares of Common Stock Outstanding, End of Period	3		3
Share Capital [Member]
Class Of Stock [Line Items]
Reclassification of Share Capital	$ 0	$ (7,058)	$ (7,058)

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Share Capital (Earnings Per Common Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Class Of Stock Disclosures [Abstract]
Net Earnings (Loss)		$ (72)	$ (1,521)	$ 32	$ (5,483)
Basic		261.1	259.8	260.7	259.8
Effect of dilutive securities	[1],[2]	0.0	0.0	4.6	0.0
Weighted Average Shares of Common Stock Outstanding - Diluted		261.1	259.8	265.3	259.8
Basic		$ (0.28)	$ (5.85)	$ 0.12	$ (21.10)
Diluted	[1],[2]	$ (0.28)	$ (5.85)	$ 0.12	$ (21.10)

[1] During the fourth quarter of 2020, Ovintiv’s Board of Directors resolved to settle certain Performance Share Units (“PSUs”) and Restricted Share Units (“RSUs”) with the issuance of the Company’s common stock. As a result, the stock-based compensation awards were modified and reclassified as equity-settled awards.

[2] For the three months ended September 30, 2021, all of Ovintiv’s equity-settled awards were determined to be antidilutive and therefore are excluded from the calculation of fully diluted net earnings (loss) per share of common stock.

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Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract]
Balance, Beginning of Period	$ 1,086	$ 957	$ 1,042	$ 1,004
Change in Foreign Currency Translation Adjustment	(48)	26	(4)	(21)
Balance, End of Period, Foreign currency translation adjustment	1,038	983	1,038	983
Pension and Other Post-Employment Benefit Plans
Balance, Beginning of Period	31	43	34	42
Amounts Reclassified from Other Comprehensive Income:
Reclassification of net actuarial (gains) and losses to net earnings	(1)	(2)	(5)	(6)
Income taxes	0	0	1	1
Curtailment in net defined periodic benefit cost	0	0	0	5
Income taxes	0	0	0	(1)
Balance, End of Period	30	41	30	41
Total Accumulated Other Comprehensive Income	$ 1,068	$ 1,024	$ 1,068	$ 1,024	$ 1,076

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Variable Interest Entities (Narrative) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2021 USD ($) MMcf	Dec. 31, 2020 USD ($)
Variable Interest Entity [Line Items]
Accounts payable and accrued liabilities, current	$ 1,866.0	$ 1,704.0
Veresen Midstream Limited Partnership [Member]
Variable Interest Entity [Line Items]
Variable interest entity, financial support, term of assessment	8 years
Variable interest entity, reporting entity involvement, maximum loss exposure, amount	$ 1,782.0
Veresen Midstream Limited Partnership [Member] | Take or Pay Commitment [Member]
Variable Interest Entity [Line Items]
Accounts payable and accrued liabilities, current	$ 0.5
Veresen Midstream Limited Partnership [Member] | Natural gas gathering and compression [Member]
Variable Interest Entity [Line Items]
Contracted capacity volumes | MMcf	1,167
Veresen Midstream Limited Partnership [Member] | Natural gas processing [Member]
Variable Interest Entity [Line Items]
Contracted capacity volumes | MMcf	925
Veresen Midstream Limited Partnership [Member] | Minimum [Member]
Variable Interest Entity [Line Items]
Length of remaining terms, in years	10 years
Veresen Midstream Limited Partnership [Member] | Maximum [Member]
Variable Interest Entity [Line Items]
Length of remaining terms, in years	24 years
Length of renewal term, in years	10 years

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Restructuring Charges (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended	16 Months Ended
	Jun. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Sep. 30, 2021	Dec. 31, 2019
Restructuring Charges [Abstract]
Restructuring and Related Activities, Initiation Date	Jun. 01, 2020
Workforce reduction percentage	25.00%
Restructuring Charges		$ 2	$ 7	$ 13	$ 88	$ 90	$ 103
Restructuring Reserve		3		3		$ 14	3	$ 8
Expected transition and severance costs		$ 104		$ 104			$ 104

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Restructuring Charges (Restructuring Costs Expensed) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended	16 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Sep. 30, 2021
Restructuring Charges [Abstract]
Severance and Benefits	$ 2	$ 6	$ 13	$ 86
Outplacement, Moving and Other Expenses	0	1	0	2
Restructuring Expenses	$ 2	$ 7	$ 13	$ 88	$ 90	$ 103

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Restructuring Charges (Schedule of Change in Restructuring Accrual) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended	16 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Sep. 30, 2021
Restructuring Charges [Abstract]
Outstanding Restructuring Accrual, Beginning of Year			$ 14	$ 8	$ 8
Restructuring Expenses Incurred	$ 2	$ 7	13	$ 88	90	$ 103
Restructuring Costs Paid			(24)		(84)
Outstanding Restructuring Accrual, End of Period	$ 3		$ 3		$ 14	$ 3

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Compensation Plans (Schedule of Weighted Average Assumptions Used to Fair Value Share Units) (Details)	9 Months Ended
	Sep. 30, 2021 $ / shares	Sep. 30, 2020 $ / shares	Sep. 30, 2021 $ / shares	Sep. 30, 2020 $ / shares
United States Of America Dollars [Member] | Stock Appreciation Rights (SARs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair Value Assumptions, Risk Free Interest Rate	0.49%	0.22%
Fair Value Assumptions, Dividend Yield	1.70%	4.60%
Fair Value Assumptions, Expected Volatility Rate	106.19%	102.43%
Fair Value Assumptions, Expected Term	1 year 6 months	2 years 6 months
Market Share Price	$ 32.88	$ 8.16
Weighted Average Grant Date Fair Value	$ 37.63	$ 38.11
Canadian Dollar [Member] | Tandem Stock Appreciation Rights (TSARs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair Value Assumptions, Risk Free Interest Rate	0.49%	0.22%
Fair Value Assumptions, Dividend Yield	1.68%	4.66%
Fair Value Assumptions, Expected Volatility Rate	105.03%	101.65%
Fair Value Assumptions, Expected Term	1 year 6 months	2 years
Market Share Price			$ 41.62	$ 10.89
Weighted Average Grant Date Fair Value			$ 50.46	$ 48.28

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Compensation Plans (Amounts Recognized For Share-Based Payment Transactions) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total Compensation Costs of Transactions Classified as Cash-Settled	$ 33	$ 4	$ 115	$ (12)
Total Compensation Costs of Transactions Classified as Equity-Settled	7	0	25	0
Less: Total Share-Based Compensation Costs Capitalized	(7)	(2)	(23)	3
Total Share-Based Compensation Expense	33	2	117	(9)
Operating Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total Share-Based Compensation Expense	8	1	26	(3)
Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total Share-Based Compensation Expense	$ 25	$ 1	$ 91	$ (6)

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Compensation Plans (Narrative) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Liability for cash-settled share-based payment transactions	$ 109	$ 34
Liability for share-based payment recognized in accounts payable and accrued liabilities	78	25
Liability for share-based payment recognized in other liabilities and provisions	$ 31	$ 9

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Compensation Plans (Schedule of Share-based Compensation, Activity) (Details) shares in Thousands	9 Months Ended
	Sep. 30, 2021 shares
Restricted Share Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	2,748
Performance Share Units (PSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	934
Deferred Share Units (DSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	14

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Pension and Other Post-Employment Benefits (Total Benefit Plan Expense Recognized) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Defined Benefit Plan Disclosure [Line Items]
Net Defined Periodic Benefit Cost	$ (2)	$ 2
Defined Contribution Plan Expense	19	24
Total Benefit Plans Expense	17	26
Pension Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Net Defined Periodic Benefit Cost	0	0
Defined Contribution Plan Expense	19	24
Total Benefit Plans Expense	19	24
OPEB [Member]
Defined Benefit Plan Disclosure [Line Items]
Net Defined Periodic Benefit Cost	(2)	2
Defined Contribution Plan Expense	0	0
Total Benefit Plans Expense	$ (2)	$ 2

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Pension and Other Post-Employment Benefits (Narrative) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Defined Benefit Plan Disclosure [Line Items]
Pension and Other Postretirement (Benefit) Expense	$ 17	$ 26
Operating Expense [Member]
Defined Benefit Plan Disclosure [Line Items]
Pension and Other Postretirement (Benefit) Expense	18	22
Administrative Expense [Member]
Defined Benefit Plan Disclosure [Line Items]
Pension and Other Postretirement (Benefit) Expense	4	5
Other Nonoperating Income (Expense) [Member]
Defined Benefit Plan Disclosure [Line Items]
Pension and Other Postretirement (Benefit) Expense	$ (5)	$ (1)

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Pension and Other Post-Employment Benefits (Defined Periodic Pension And OPEB Expense) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Defined Benefit Plan Disclosure [Line Items]
Service Cost	$ 3	$ 3
Interest Cost	4	6
Expected Return on Plan Assets	(4)	(5)
Amortization of net actuarial (gains) and losses	(5)	(6)
Curtailment from net prior service costs	0	5
Curtailment	0	(1)
Total Net Defined Periodic Benefit Cost	(2)	2
Defined Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service Cost	0	0
Interest Cost	3	4
Expected Return on Plan Assets	(4)	(5)
Amortization of net actuarial (gains) and losses	1	1
Curtailment from net prior service costs	0	0
Curtailment	0	0
Total Net Defined Periodic Benefit Cost	0	0
OPEB [Member]
Defined Benefit Plan Disclosure [Line Items]
Service Cost	3	3
Interest Cost	1	2
Expected Return on Plan Assets	0	0
Amortization of net actuarial (gains) and losses	(6)	(7)
Curtailment from net prior service costs	0	5
Curtailment	0	(1)
Total Net Defined Periodic Benefit Cost	$ (2)	$ 2

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Fair Value Measurements (Schedule Of Fair Value, Assets And Liabilities Measured On Recurring Basis) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Net, Current	$ 1	$ 37
Risk Management Assets, Net, Long-term	0	4
Risk Management Liabilities, Net, Current	1,418	130
Risk Management Liabilities, Net, Long-term	246	125
Other Derivative Contract Assets	9	0
Guarantor Obligations, Current Carrying Value	6	8
Other Noncurrent Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	5	0
Other Noncurrent Assets [Member] | Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	5
Other Noncurrent Assets [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	0
Other Noncurrent Assets [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	0
Other Noncurrent Assets [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	5
Other Liabilities and Provisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	5	7
Other Liabilities and Provisions [Member] | Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	5	7
Other Liabilities and Provisions [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	0	0
Other Liabilities and Provisions [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	5	7
Other Liabilities and Provisions [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	0	0
Accounts Receivable and Accrued Revenues [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	4	0
Accounts Receivable and Accrued Revenues [Member] | Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	4
Accounts Receivable and Accrued Revenues [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	0
Accounts Receivable and Accrued Revenues [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	0
Accounts Receivable and Accrued Revenues [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other Derivative Contract Assets	4
Accounts Payable and Accrued Liabilities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	1	1
Accounts Payable and Accrued Liabilities [Member] | Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	1	1
Accounts Payable and Accrued Liabilities [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	0	0
Accounts Payable and Accrued Liabilities [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	1	1
Accounts Payable and Accrued Liabilities [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guarantor Obligations, Current Carrying Value	0	0
Commodity Derivatives [Member] | Other Current Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	41	70
Risk Management Assets, Gross Liabilities	(41)	(59)
Risk Management Assets, Net, Current	0	11
Commodity Derivatives [Member] | Other Current Assets [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	0
Commodity Derivatives [Member] | Other Current Assets [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	41	70
Commodity Derivatives [Member] | Other Current Assets [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	0
Commodity Derivatives [Member] | Other Noncurrent Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	2	7
Risk Management Assets, Gross Liabilities	(2)	(3)
Risk Management Assets, Net, Long-term	0	4
Commodity Derivatives [Member] | Other Noncurrent Assets [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	0
Commodity Derivatives [Member] | Other Noncurrent Assets [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	2	7
Commodity Derivatives [Member] | Other Noncurrent Assets [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	0
Commodity Derivatives [Member] | Other Current Liabilities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	1,465	189
Risk Management Liabilities, Gross Assets	(41)	(59)
Risk Management Liabilities, Net, Current	1,424	130
Commodity Derivatives [Member] | Other Current Liabilities [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	4	1
Commodity Derivatives [Member] | Other Current Liabilities [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	1,163	114
Commodity Derivatives [Member] | Other Current Liabilities [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	298	74
Commodity Derivatives [Member] | Other Liabilities and Provisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	248	128
Risk Management Liabilities, Gross Assets	(2)	(3)
Risk Management Liabilities, Net, Long-term	246	125
Commodity Derivatives [Member] | Other Liabilities and Provisions [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	0	0
Commodity Derivatives [Member] | Other Liabilities and Provisions [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	211	128
Commodity Derivatives [Member] | Other Liabilities and Provisions [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	37	0
Foreign Currency Derivatives [Member] | Other Current Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	7	26
Risk Management Assets, Gross Liabilities	(6)	0
Risk Management Assets, Net, Current	1	26
Foreign Currency Derivatives [Member] | Other Current Assets [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	0
Foreign Currency Derivatives [Member] | Other Current Assets [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	7	26
Foreign Currency Derivatives [Member] | Other Current Assets [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Assets, Gross assets	0	$ 0
Foreign Currency Derivatives [Member] | Other Current Liabilities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	0
Risk Management Liabilities, Gross Assets	(6)
Risk Management Liabilities, Net, Current	(6)
Foreign Currency Derivatives [Member] | Other Current Liabilities [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	0
Foreign Currency Derivatives [Member] | Other Current Liabilities [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	0
Foreign Currency Derivatives [Member] | Other Current Liabilities [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Risk Management Liabilities, Gross liabilities	$ 0

XML

Fair Value Measurements (Summary Of Changes In Level 3 Fair Value Measurements) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Abstract]
Balance, Beginning Balance	$ (74)	$ (52)
Total Gains (Losses)	(637)	214
Purchases, sales and issuances	6	0
Settlements	379	(83)
Transfers Out of Level 3	0	0
Balance, Ending Balance	(326)	79
Change in Unrealized Gains (Losses) During the Period Included in Net Earnings (Loss)	$ (258)	$ 131

XML

Fair Value Measurements (Quantitative Information About Unobservable Inputs Used In Level 3) (Details) - WTI Options [Member] - Option Model [Member]	9 Months Ended
	Sep. 30, 2021
Minimum [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Fair Value Inputs Commodity Price Volatility	34.00%
Maximum [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Fair Value Inputs Commodity Price Volatility	138.00%
Weighted Average [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Fair Value Inputs Commodity Price Volatility	48.00%

XML

Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Ten Percent Change in Implied Volatility [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Increase (Decrease) in Risk Management Assets and Liabilities	$ 17	$ 6

XML

Financial Instruments and Risk Management (Narrative) (Details)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021 USD ($) contract $ / $	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($) contract $ / $	Sep. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)
Derivative [Line Items]
Realized Gain (Loss) on Derivatives	$ (364,000,000)	$ 91,000,000	$ (725,000,000)	$ 598,000,000
Unrealized Gain (Loss) on Derivatives	$ (590,000,000)	(228,000,000)	(1,445,000,000)	(19,000,000)
Credit risk, financial instrument, maximum exposure, based on gross fair value basis			59,000,000
Credit risk, financial instrument, maximum exposure, based on net fair value basis			$ 10,000,000
Number of credit risk derivatives held | contract	0		0
Collateral balances	$ 0		$ 0
Concentration risk, percentage			91.00%		89.00%
Other Derivative Contracts, Liabilities	6,000,000		$ 6,000,000		$ 8,000,000
Guarantor Obligations, Maximum Exposure, Undiscounted	63,000,000		$ 63,000,000
Maximum [Member]
Derivative [Line Items]
Guarantor Obligations, Term			three years
Revenue [Member]
Derivative [Line Items]
Realized Gain (Loss) on Derivatives	(371,000,000)	89,000,000	$ (750,000,000)	605,000,000
Unrealized Gain (Loss) on Derivatives	(579,000,000)	(243,000,000)	(1,426,000,000)	(18,000,000)
Currency Swaps, Maturing Remainder Of Fiscal Year [Member]
Derivative [Line Items]
Foreign currency swap, contract amount outstanding	$ 88,000,000		$ 88,000,000
Derivative, average forward exchange rate | $ / $	1.3720		1.3720
Currency Swaps, Maturing In Two Years [Member]
Derivative [Line Items]
Foreign currency swap, contract amount outstanding	$ 100,000,000		$ 100,000,000
Derivative, average forward exchange rate | $ / $	1.2820		1.2820
Other Derivative Contracts [Member] | Revenue [Member]
Derivative [Line Items]
Realized Gain (Loss) on Derivatives	$ 0	0	$ 1,000,000	2,000,000
Unrealized Gain (Loss) on Derivatives	$ 1,000,000	$ 0	$ 4,000,000	$ (4,000,000)

XML

Financial Instruments and Risk Management (Risk Management Positions) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2021 USD ($) $ / bbl $ / Mcf MMcf MBbls	Dec. 31, 2020 USD ($)
Derivative [Line Items]
Other Derivative Contracts, Net	$ 3
Foreign Currency Swaps, at Fair value, Net	7
Total Fair Value Position	$ (1,660)	$ (222)
Oil [Member] | WTI Fixed Price Contracts Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	30.0
Average Price, Fixed Price Contracts | $ / bbl	46.37
Price Risk Derivatives, at Fair Value, Net	$ (77)
Term	Dec. 31, 2021
Oil [Member] | WTI Fixed Price Contracts Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	5.0
Average Price, Fixed Price Contracts | $ / bbl	60.16
Price Risk Derivatives, at Fair Value, Net	$ (18)
Term	Dec. 31, 2022
Oil [Member] | WTI Three-Way Options Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	85.0
Price Risk Derivatives, at Fair Value, Net	$ (136)
Term	Dec. 31, 2021
Oil [Member] | WTI Three-Way Options Maturing 2021 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	53.92
Oil [Member] | WTI Three-Way Options Maturing 2021 [Member] | Sold [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	34.79
Oil [Member] | WTI Three-Way Options Maturing 2021 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	44.66
Oil [Member] | WTI Three-Way Options Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	75.0
Price Risk Derivatives, at Fair Value, Net	$ (164)
Term	Dec. 31, 2022
Oil [Member] | WTI Three-Way Options Maturing 2022 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	70.79
Oil [Member] | WTI Three-Way Options Maturing 2022 [Member] | Sold [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	49.33
Oil [Member] | WTI Three-Way Options Maturing 2022 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	60.82
Oil [Member] | Basis Contracts Maturing 2021 [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (4)
Term	Dec. 31, 2021
Oil [Member] | West Texas Intermediate Costless Collars Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	15.0
Price Risk Derivatives, at Fair Value, Net	$ (35)
Term	Dec. 31, 2021
Oil [Member] | West Texas Intermediate Costless Collars Maturing 2021 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	45.84
Oil [Member] | West Texas Intermediate Costless Collars Maturing 2021 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / bbl	35.00
Oil [Member] | Basis Contracts Maturing 2022 [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (1)
Term	Dec. 31, 2022
Natural Gas Liquids [Member] | Propane Fixed Price Contracts Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	12.0
Average Price, Fixed Price Contracts | $ / bbl	25.78
Price Risk Derivatives, at Fair Value, Net	$ (38)
Term	Dec. 31, 2021
Natural Gas Liquids [Member] | Ethane Fixed Price Contracts Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	8.0
Average Price, Fixed Price Contracts | $ / bbl	11.05
Price Risk Derivatives, at Fair Value, Net	$ (5)
Term	Dec. 31, 2021
Natural Gas Liquids [Member] | Butane Fixed Price Contracts Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MBbls	5.0
Average Price, Fixed Price Contracts | $ / bbl	24.83
Price Risk Derivatives, at Fair Value, Net	$ (19)
Term	Dec. 31, 2021
Oil and NGLs [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (497)
Oil and NGLs [Member] | Other Crude Financial Positions [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	0
Natural Gas [Member] | Fair Value Position Excluding Unexpired Options [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	(1,173)
Natural Gas [Member] | Basis Contracts Maturing 2021 [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (9)
Term	Dec. 31, 2021
Natural Gas [Member] | Basis Contracts Maturing 2022 [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (29)
Term	Dec. 31, 2022
Natural Gas [Member] | NYMEX Fixed Price Contracts Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	165
Average Price, Fixed Price Contracts | $ / Mcf	2.51
Price Risk Derivatives, at Fair Value, Net	$ (52)
Term	Dec. 31, 2021
Natural Gas [Member] | NYMEX Fixed Price Contracts Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	200
Average Price, Fixed Price Contracts | $ / Mcf	2.67
Price Risk Derivatives, at Fair Value, Net	$ (125)
Term	Dec. 31, 2022
Natural Gas [Member] | NYMEX Fixed Price Swaptions Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	165
Average Price, Fixed Price Contracts | $ / Mcf	2.51
Price Risk Derivatives, at Fair Value, Net	$ (113)
Term	Dec. 31, 2022
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	398
Price Risk Derivatives, at Fair Value, Net	$ (205)
Term	Dec. 31, 2022
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2022 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	3.02
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2022 [Member] | Sold [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.00
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2022 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.75
Natural Gas [Member] | NYMEX Costless Collars Maturing 2022 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	200
Price Risk Derivatives, at Fair Value, Net	$ (116)
Term	Dec. 31, 2022
Natural Gas [Member] | NYMEX Costless Collars Maturing 2022 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.85
Natural Gas [Member] | NYMEX Costless Collars Maturing 2022 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.55
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2021 [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	980
Price Risk Derivatives, at Fair Value, Net	$ (230)
Term	Dec. 31, 2021
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2021 [Member] | Sold [Member] | Call Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	3.36
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2021 [Member] | Sold [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.50
Natural Gas [Member] | NYMEX Three-Way Options Maturing 2021 [Member] | Bought [Member] | Put Option [Member]
Derivative [Line Items]
Average Price, Options/Collars | $ / Mcf	2.89
Natural Gas [Member] | NYMEX Call Options Maturing 2022 [Member] | Sold [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount, Volumes/day | MMcf	330
Price Risk Derivatives, at Fair Value, Net	$ (244)
Term	Dec. 31, 2022
Average Price, Options/Collars | $ / Mcf	2.38
Natural Gas [Member] | Other Financial Positions [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (16)
Natural Gas [Member] | Basis Contracts Maturing 2023 to 2025 [Member]
Derivative [Line Items]
Price Risk Derivatives, at Fair Value, Net	$ (34)
Minimum [Member] | Currency Swap [Member]
Derivative [Line Items]
Term	Dec. 31, 2021
Minimum [Member] | Natural Gas [Member] | Basis Contracts Maturing 2023 to 2025 [Member]
Derivative [Line Items]
Term	Jan. 01, 2023
Maximum [Member] | Currency Swap [Member]
Derivative [Line Items]
Term	Dec. 31, 2022
Maximum [Member] | Natural Gas [Member] | Basis Contracts Maturing 2023 to 2025 [Member]
Derivative [Line Items]
Term	Dec. 31, 2025

XML

Financial Instruments and Risk Management (Earnings Impact of Realized and Unrealized Gains (Losses) On Risk Management Positions) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Realized Gain (Loss) on Derivatives	$ (364)	$ 91	$ (725)	$ 598
Unrealized Gain (Loss) on Derivatives	(590)	(228)	(1,445)	(19)
Realized and Unrealized Gain (Loss) on Risk Management	(954)	(137)	(2,170)	579
Revenue [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Realized Gain (Loss) on Derivatives	(371)	89	(750)	605
Unrealized Gain (Loss) on Derivatives	(579)	(243)	(1,426)	(18)
Realized and Unrealized Gain (Loss) on Risk Management	(950)	(154)	(2,176)	587
Foreign Currency Gain (Loss) [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Realized Gain (Loss) on Derivatives	7	2	25	(7)
Unrealized Gain (Loss) on Derivatives	(11)	15	(19)	(1)
Realized and Unrealized Gain (Loss) on Risk Management	$ (4)	$ 17	$ 6	$ (8)

XML

Financial Instruments and Risk Management (Reconciliation of Unrealized Risk Management Positions) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Derivative [Line Items]
Fair Value of Contracts, Beginning of Year			$ (222)
Settlement of Other Derivative Contracts			1
Fair Value of Other Derivative Contract Assets Entered into During the Period			6
Fair Value of Contracts Realized During the Period	$ 364	$ (91)	725	$ (598)
Fair Value of Contracts, End of Period	(1,660)		(1,660)
Unrealized Gain (Loss) on Derivatives	$ (590)	$ (228)	(1,445)	(19)
Commodity Contract [Member]
Derivative [Line Items]
Increase (Decrease) in Derivative Assets and Liabilities			$ (2,170)	$ 579

XML

Financial Instruments and Risk Management (Unrealized Risk Management Positions) (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Derivatives, Fair Value [Line Items]
Risk Management, Current asset	$ 1	$ 37
Risk Management, Long-term asset	0	4
Risk Management, Total asset	1	41
Risk Management, Current liability	1,418	130
Risk Management, Long-term liability	246	125
Risk Management, Total liability	1,664	255
Other Derivative Contract Assets	9	0
Guarantor Obligations, Current Carrying Value	6	8
Risk Management and Other Derivative Guarantee, at Fair Value, Net	(1,660)	(222)
Accounts Receivable and Accrued Revenues [Member]
Derivatives, Fair Value [Line Items]
Other Derivative Contract Assets	4	0
Accounts Payable and Accrued Liabilities [Member]
Derivatives, Fair Value [Line Items]
Guarantor Obligations, Current Carrying Value	1	1
Other Assets [Member]
Derivatives, Fair Value [Line Items]
Other Derivative Contract Assets	5	0
Other Liabilities and Provisions [Member]
Derivatives, Fair Value [Line Items]
Guarantor Obligations, Current Carrying Value	$ 5	$ 7

XML

Supplementary Information (Net Change in Non-Cash Working Capital) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Supplemental Cash Flow Elements [Abstract]
Accounts receivable and accrued revenues	$ (25)	$ 78	$ (287)	$ 289
Accounts payable and accrued liabilities	13	42	211	(212)
Current portion of operating lease liabilities	(9)	(4)	(5)	(10)
Income tax receivable and payable	(2)	26	23	39
Net change in non-cash working capital	$ (23)	$ 142	$ (58)	$ 106

XML

Supplementary Information (Non-Cash Activity) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Non-Cash Operating Activities
ROU operating lease assets and liabilities	$ (4)	$ (5)	$ (22)	$ (6)
Non-Cash Investing Activities
Asset retirement obligation incurred	0	2	0	11
Asset retirement obligation change in estimated future cash outflows	0	(10)	0	12
Property, plant and equipment accruals	4	68	(33)	(62)
Capitalized long-term incentives	5	2	12	(7)
Property additions/dispositions (swaps)	18	212	24	229
Duvernay Assets [Member]
Non-Cash Investing Activities
Contingent consideration (See Note 7)	$ 0	$ 0	$ 6	$ 0

XML

Commitments and Contingencies (Details) $ in Millions	Sep. 30, 2021 USD ($)
Commitments [Line Items]
2021	$ 216
2022	799
2023	719
2024	523
2025	459
Thereafter	2,336
Total	5,052
Transportation and Processing Commitments [Member]
Commitments [Line Items]
2021	181
2022	745
2023	689
2024	493
2025	429
Thereafter	2,334
Total	4,871
Drilling and Field Services Commitments [Member]
Commitments [Line Items]
2021	32
2022	44
2023	24
2024	24
2025	24
Thereafter	0
Total	148
Building Leases [Member]
Commitments [Line Items]
2021	3
2022	10
2023	6
2024	6
2025	6
Thereafter	2
Total	$ 33