CALGARY, April 11, 2016 /CNW/ – Enerplus Corporation (“Enerplus” or the “Company”) (TSX & NYSE: ERF) announces that it has entered into a definitive agreement to sell certain non-core assets located in Northwest Alberta, including its Pouce Coupe asset (the “Assets”). The total cash consideration for the Assets is approximately $95.5 million, subject to closing adjustments, and the transaction is expected to close in the second quarter of 2016. Enerplus has used its 2016 divestment proceeds, which will total $288.5 million upon the closing of this divestment, to reduce its outstanding debt, including repurchasing a portion of its senior unsecured notes.
At December 31, 2015 the Assets were estimated to have proved plus probable reserves of 9.1 million BOE (50% natural gas) with production from the Assets expected to average approximately 2,300 BOE per day in 2016 (50% natural gas, 30% non-operated). Given the higher operating costs and lower project returns relative to other areas in Enerplus’ portfolio, the Assets were considered non-core to the Company’s long-term strategy.
The divestment is expected to be accretive on both a production per debt adjusted share and funds flow per debt adjusted share basis, and have a modest impact on 2016 funds flow.
Enerplus is maintaining its 2016 production guidance range of 90,000 to 94,000 BOE per day, despite this divestment, as a result of continued strong operational performance.
TD Securities Inc. is acting as exclusive financial advisor to Enerplus on this transaction.
About Enerplus
Enerplus Corporation is a responsible developer of high quality crude oil and natural gas assets in Canada and the United States, focused on providing both growth and income to its shareholders.