Baytex has entered into an agreement to acquire the shares of a private company with heavy oil assets in the Lloydminster area of southwest Saskatchewan. The aggregate cash consideration for the acquisition (net of estimated positive working capital at closing) is approximately $40.9 million, which will be funded by drawing on Baytex's revolving credit facility. The acquisition, which is subject to certain conditions, including shareholder approval and the receipt of all required regulatory and court approvals, is expected to close in late-May 2010.
Production from the acquired assets is approximately 900 barrels of oil per day. Baytex is also acquiring approximately 32,100 net acres of undeveloped land. The acquired assets provide a number of cold heavy oil development opportunities and can be readily integrated into Baytex's existing producing infrastructure in the Lloydminster area. The acquisition does not materially affect Baytex's current production mix, which is approximately 80% oil. Our capital budget for exploration and development activities for 2010 will remain unchanged at $235 million, as minor amounts of capital will be redirected toward the acquired assets. The acquisition is estimated to be 2% accretive to funds from operations and production on a per unit basis.
Most Popular Articles
From the Career Center
Jobs that may interest you