Aspenleaf Energy has completed acquisition of NEP Canada, a private, light oil producer with operations focused in the Leduc/Woodbend region.
Image: Onshore drilling. Photo: courtesy of Stuart Miles/Freedigitalphotos.net.
This acquisition combines two central Alberta based assets that are both geographically and geologically complementary to create an opportunity rich, high netback, light oil based entity.
Aspenleaf’s combined current production now exceeds 16,000 boe/d (85% oil and liquids), and the Company has material growth potential in both its two long-life, core areas of development: Nisku light oil at Leduc/Woodbend and Beaverhill Lake light oil at Swan Hills.
Aspenleaf has identified a significant number of highly economic new well locations and has a seven-year drilling inventory across its two core areas.
The Company sees continued production improvement, reserve growth and low corporate decline rates from the expansion of its waterflood operations in Swan Hills and plans to implement waterflood support to the Leduc/Woodbend assets.
Aspenleaf enjoys top decile operating netbacks (over $42/boe based on $80/bbl Edmonton mixed sweet blend oil price) which provide for sustainable, self-funded future development.
The Company operates materially all of its production and has an average working interest of over 90% across its properties. Pro forma, the Company’s Alberta Energy Regulator’s Liability Management Rating for July 2018 would be greater than seven.
Aspenleaf financed the majority of the NEP Canada acquisition with equity, comprised of previously committed equity and additional equity financing from its existing shareholders.
Post-close, Aspenleaf maintains a strong balance sheet and is focused on ensuring conservative financial leverage.
Aspenleaf CEO Bryan Gould said: “Aspenleaf is excited about the suite of opportunities in both of its two core areas and will continue to grow its production and reserve base through low risk development drilling, combined with directed waterflood implementation and expansion.”
National Bank Financial Inc. acted as exclusive financial advisor to Aspenleaf with respect to this acquisition. Osler, Hoskin & Harcourt LLP acted as legal counsel to Aspenleaf. Tudor, Pickering, Holt & Co. Securities – Canada, ULC acted as exclusive financial advisor to NEP Canada. Bennett Jones LLP acted as legal counsel for NEP Canada.
Source: Company Press Release