CALGARY, ALBERTA–(Marketwired – Oct. 1, 2014) – Lightstream Resources Ltd. (the “Company” or “Lightstream”) (TSX:LTS) is pleased to announce the closing of our previously announced agreement with Crescent Point Energy Ltd. to sell the remaining assets in our southeast Saskatchewan Conventional business unit for gross proceeds of $378.4 million. Proceeds include cash consideration of $375 million (before customary adjustments) and three key parcels of Bakken rights valued at $3.4 million that will enable us to accelerate the expansion our Creelman enhanced oil recovery (“EOR”) project.
Further positive attributes of this transaction include: the elimination of $38.5 million of future abandonment and reclamation liabilities on our balance sheet to reflect the disposition of approximately 450 net wells and associated facilities; a reduction in our capital expenditure guidance for 2014 by $15 million; and the elimination of future regulatory compliance costs associated with sour gas venting at these properties.
Consistent with other divestment activity in 2014, we applied cash proceeds to reduce corporate debt which, pro forma June 30, 2014, and following the transactions to date, is approximately $1.5 billion. The amount drawn on our secured term credit facility is now approximately $500 million, leaving $650 million of available liquidity under the facility.
With our balance sheet strengthened and divestiture targets exceeded, we remain focused on operational efficiency and the effective deployment of capital in our core operating areas. We currently have 3 rigs drilling in our Cardium business unit and a 4th rig active in our Bakken business unit. We are also on target to commence natural gas injection in two further patterns in our Bakken EOR initiative before year end.
Lightstream Resources Ltd. is an oil and gas exploration and production company combining light oil Bakken and Cardium resource plays with conventional light oil assets, delivering industry leading operating netbacks, strong cash flows and production growth. Lightstream is applying leading edge technology to a multi-year inventory of Bakken and Cardium light oil development locations, along with other emerging resource play opportunities. Our strategy is to deliver accretive production and reserves growth, along with an attractive dividend yield.
BOEs. Natural gas volumes have been converted to barrels of oil equivalent (“boe”). Six thousand cubic feet (“Mcf”) of natural gas is equal to one barrel of oil equivalent based on an energy equivalency conversion method primarily attributable at the burner tip and does not represent a value equivalency at the wellhead. Boes may be misleading, especially if used in isolation.
Lightstream Resources Ltd.
John D. Wright
President and Chief Executive Officer
Lightstream Resources Ltd.
Peter D. Scott
Senior Vice President and Chief Financial Officer