Sayer Energy Advisors has been engaged to assist Freehold Royalties Ltd. (“Freehold” or the “Company”) with the sale of its working interest and non-operated unit interests in oil and natural gas properties in central Alberta (the “Properties”).
The Properties represent an opportunity to acquire an oil-weighted, low-decline production stream with current annualized cash flow of approximately $4.1 million, and provides exposure to a number of operated and non-operated drilling opportunities.
Production is approximately 414 boe/d (72% oil and natural gas liquids) net to the Company. The total package LMR is 8.68 with net deemed asset value of $6.9 million ($7.8 million deemed assets, $900,000 deemed liabilities).
The working interest properties have been separated into in the following areas; South Package, West Package, Central Package and North Package. Freehold’s non-operated unit working interests are in the Pembina Cardium Unit No 9, Pembina Belly River X Unit, Brazeau River Gas Unit No 1, Pembina Belly River B South Unit, Thorsby Glauconitic Unit No 1 and the Pembina Cardium Unit No 31.
Trimble Engineering Associates Ltd. (“Trimble”) estimates that as of December 31, 2016, the working interest properties contained remaining proved plus probable reserves of 425,000 barrels of oil and natural gas liquids and 1.9 Bcf of natural gas (743,000 boe), with an estimated net present value of $6.2 million using forecast pricing at a 10% discount.
Trimble estimates that as of December 31, 2016, the non-operated unit working interests contained remaining proved plus probable reserves of 1.2 million barrels of oil and natural gas liquids and 1.5 Bcf of natural gas (1.4 million boe), with an estimated net present value of $19.3 million using forecast pricing at a 10% discount.
Summary information relating to this divestiture is attached to this correspondence. More specific information is available at www.sayeradvisors.com. A package of more detailed confidential information will be sent to any party executing a Confidentiality Agreement (copy attached).
Cash offers relating to this divestiture will be accepted until 12:00 pm on Thursday, April 27, 2017.
For further information please feel free to contact Ben Rye, Jill Switzer, Tom Pavic or myself at 403.266.6133.
Alan W. Tambosso, P.Eng. P.Geol.
SAYER ENERGY ADVISORS
1620, 540 – 5th Avenue SW
Calgary, Alberta T2P 0M2
P: 403.266.6133 C: 403.650.8061 F: 403.266.4467