Tourmaline Oil has entered into a definitive arrangement agreement to acquire all issued and outstanding common shares of Crew Energy in a deal worth about C$1.3bn ($947m).
The transaction will be settled through the issuance of 18.778 million Tourmaline common shares and the assumption of Crew’s net debt of around C$240m, including transaction costs.
The acquisition is anticipated to close in early October 2024, pending customary closing conditions.
The acquisition plays a key role in Tourmaline’s ongoing strategy to consolidate its presence in Northeast British Columbia (NEBC), enhancing its long-term exploration and production (EP) growth plan.
This deal significantly strengthens Tourmaline’s South Montney asset base and is immediately accretive to the company’s financial and reserve metrics, boosting anticipated 2025 free cash flow by over C$200m.
The addition of Crew’s assets offers substantial future growth potential and, alongside Tourmaline’s extensive BC Montney development inventory, positions the Company to become Canada’s largest and most efficient Montney producer.
Already the largest producer in Alberta’s Deep Basin, Tourmaline is on track to become a leading Canadian senior producer, targeting 750,000 boepd within the next five years, with further growth prospects extending into the next decade.
The acquisition includes low-decline base production of 29,000 to 30,000 boepd, alongside independently evaluated proved and probable (2P) reserves of 473.2 million boe.
It also encompasses an extensive drilling inventory with over 700 Tier 1 locations.
Crew president and CEO Dale Shwed said: “We are excited about this transformative transaction with Tourmaline, which reflects the successful culmination of Crew’s focused efforts to delineate and grow our high-quality Montney asset base, while providing Crew Shareholders continued exposure to the assets, participation in a dividend and the ability to benefit from future growth and value creation.”
