Husky Energy announced that the agreement to purchase Penn West heavy oil properties closed on November 30, 2009. The properties are contained within Husky's Lloydminster area of operations in Alberta and Saskatchewan.
The asset acquisition provides Husky more than 6,000 barrels of oil production per day, 12.0 million barrels of oil proven reserves and 8.5 million barrels of oil probable reserves. The reserve estimates are as of November 1, 2009.
"This is a strategic acquisition in a region that is a very profitable and highly productive business segment," said John C.S. Lau, president and chief executive officer of Husky Energy. "We will capitalize on our technical expertise and take advantage of operational synergies by integrating these assets into the Company's extensive heavy oil operations."
Husky has acquired 16,700 acres (26 sections) of undeveloped land with the purchase. "This will compliment the Company's extensive heavy oil resource base by adding approximately one billion barrels of discovered petroleum initially in place," added Mr. Lau.
The Lloydminster area of Alberta and Saskatchewan is a core area for Husky business. The Company's heavy oil assets are concentrated in a large producing region covering more than 8,000 square kilometers. Husky has significant infrastructure in the area, including an Upgrader, Asphalt Refinery, Meridian Co-generation Power Plant, Ethanol Plant, Logistics Center and pipelines.
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