The Conversation (0)
Tourmaline Oil Announces Strategic Asset Acquisition in the Alberta Deep Basin and NEBC Montney Complex
Oct. 21, 2016 09:15AM PST
Oil and Gas InvestingTourmaline Oil (TSX:TOU) (“Tourmaline” or the “Company”) entered into an agreement with Shell Canada Energy (“Shell Canada”) to acquire strategic assets located in the Alberta Deep Basin (the “Deep Basin Assets”) and the NEBC Montney Complex (the “Montney Assets”). As quoted in the press release: Pursuant to the Acquisition, Tourmaline has agreed to acquire current …
Tourmaline Oil (TSX:TOU) (“Tourmaline” or the “Company”) entered into an agreement with Shell Canada Energy (“Shell Canada”) to acquire strategic assets located in the Alberta Deep Basin (the “Deep Basin Assets”) and the NEBC Montney Complex (the “Montney Assets”).
As quoted in the press release:
Pursuant to the Acquisition, Tourmaline has agreed to acquire current production of approximately 24,850 boepd, estimated current 2P reserves of 473.5 mmboe and a combined evaluated future drilling inventory of 2,147 locations between the Deep Basin Assets and Montney Assets. The total purchase price of $1.369 billion compares favorably to a current 2P NPV10 of $2.3 billion.
The Deep Basin Assets consist of 382 gross sections (154 of which are joint working interest with Tourmaline) and current low-decline production of approximately 18,650 boepd. Tourmaline will also acquire Shell Canada’s infrastructure consisting of three 100%-operated gas plants (estimated processing capacity of 200-225 mmcfpd) and 719 km of pipelines, providing Tourmaline with total operated processing capacity of over 1.0 bcf/day in the Alberta Deep Basin. The Company plans to add approximately 100 mmcfpd of new production in 2017 from the Deep Basin Assets through the drilling of 31 horizontal wells and fill the acquired infrastructure capacity.
The Montney Assets in BC consist of a large, contiguous 100% working interest 101 section land block in an area with 300 metres of Montney gross pay, four separate lobes to develop, and liquid content ranging from 10-80 bbls/mmcf…The acquired Montney Assets now provide Tourmaline with sufficient size and scope in the Northern Montney play area to drive strategic Company-operated infrastructure development. The Montney Assets also make existing Company lands at Blueberry-Inga-Attachie (approximately 768 potential drilling locations) substantially more valuable through this planned infrastructure development.
Including the effect of the Acquisition and associated development, the Company is expecting 2017 production of approximately 250,000-260,000 boepd, and 2018 production levels of 310,000-320,000 boepd.