TSX, NYSE: BXE – CALGARY, July 7, 2016 /CNW/ – Bellatrix Exploration Ltd. (“Bellatrix” or the “Company”) (TSX, NYSE: BXE) is pleased to announce that it has entered into an agreement to sell a 35% minority interest in the Bellatrix O’Chiese Nees-Ohpawganu’ck deep-cut gas plant at Alder Flats (the “Alder Flats Plant”) to Keyera Partnership (“Keyera”), one of the current co-owners of the Alder Flats Plant, for cash consideration of $112.5 million. The transaction further validates the material underlying value inherent in Bellatrix’s expansive facilities and infrastructure assets.
Bellatrix is currently a 60% owner in the Alder Flats Plant, which has a design inlet capacity of 230 mmcf/d and is being developed in two phases. Phase 1 was commissioned in May 2015 and Phase 2 is currently under construction and scheduled for completion in the first half of 2018.
As part of the transaction, Bellatrix and Keyera will enter into a midstream services and governance agreement pursuant to which Bellatrix will have exclusive access to the purchased capacity (approximately 80.5 mmcf/d post commissioning of Phase 2) for a term of 10 years, and will remain the operator of the Alder Flats Plant. Following completion of the transaction, Bellatrix will retain a 25% interest in the Alder Flats Plant, and will also have the option to reacquire a 5% interest in the Alder Flats Plant near the end of the final year of the agreement at a cost of $8 million.
The transaction is subject to customary closing conditions, including approval under the Competition Act (Canada), and the exercise or waiver of a right of first refusal under the construction, ownership and operating agreement governing the Alder Flats Plant. The transaction is expected to close in early August 2016. Bellatrix intends to use the cash proceeds from the transaction to partially repay indebtedness outstanding under its syndicated credit facilities.
Bellatrix Exploration Ltd. is a Western Canadian based growth oriented oil and gas company engaged in the exploration for, and the acquisition, development and production of oil and natural gas reserves in the provinces of Alberta, British Columbia and Saskatchewan. Common shares of Bellatrix trade on the Toronto Stock Exchange and on the New York Stock Exchange under the symbol BXE.