(Bloomberg) -- DeltaStream Energy Corp., a small private-equity backed oil producer in central Alberta, is shutting down all its wells by next month amid the biggest oil rout in history. But zero production won’t mean no income.

The company’s hedge book means that DeltaSteam expects to earn close to C$40 million ($28 million) this year from positions locked in when oil was trading closer to $50 a barrel and higher, Chief Executive Officer Roger Tang said by telephone. The company is winding down production, pumping about 1,000 barrels a day from wells in the Clearwater formation near Slave Lake, less than a tenth of what the company was producing before the downturn, Tang said.

“After April, we have nothing,” he said. “We are not going to sell oil.”

Oil futures in New York collapsed this week to an unprecedented negative $40 a barrel as the coronavirus pandemic slashed demand and storage facilities filled to capacity. Before the collapse, DeltaStream would enter into hedging positions on Western Canadian Select crude and West Texas Intermediate futures every six to eight months at prices of between $45 and $55 a barrel, Tang said. The company is now looking to cash in on those positions.

DeltaStream is one of a handful of companies including Cenovus Energy Inc. and Spur Petroleum Ltd. to tap the growing heavy-oil play in the Slave Lake area. The region is remote and until a new pipeline is completed, oil must be trucked part of the way to an existing pipeline. Tang estimates that DeltaSteam is making as little as a $1 a barrel at current rates, but is shutting for the time being amid the risk for negative prices.

©2020 Bloomberg L.P.