Epsilon Energy Ltd. announced it has acquired its operating partner's 50-percent joint venture interest in Saskatchewan for $2.3 million (CAD $2.4 million). The transaction will increase Epsilon's leasehold interests in Saskatchewan from approximately 28,234 net acres to 49,007 net acres. In addition, Epsilon will acquire all oil production, third party agreements, well interests and equipment.
The joint venture was formed in 2008 to focus on oil exploration and development in Saskatchewan targeting the Bakken and Midale formations. Epsilon began operating in Alberta in 2012 and, through this transaction, will become the operator in Saskatchewan. Earlier this year, Epsilon drilled two wells within the Saskatchewan joint venture leaseholds. The first well in Torquay targeting the Midale formation is currently being completed. The second well in Ceylon targeting the Bakken formation is scheduled for completion in late June.
Zoran Arandjelovic, chairman and chief executive officer, commented, "The Midale is the third largest oil accumulation in Canada. It has undergone several stages of evolution, including secondary recovery. Recent technological advances in multi-stage fracking have reinvigorated this resource play. As operator, we expect to significantly increase our value by directing our focus to what we consider to be previously overlooked assets."
Epsilon Energy Ltd. is a North American onshore exploration and production company with a current focus in the Marcellus Shale in Pennsylvania, Bakken Shale in Saskatchewan and Basal Belly River in Alberta.
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