CALGARY, Oct. 3, 2016 /CNW/ – (TSX:PMT) – Perpetual Energy Inc. (“Perpetual”, the “Corporation” or the “Company”) is pleased to announce that it has closed the previously disclosed strategic disposition of certain of its mature shallow gas properties in east central and northeast Alberta (the “Shallow Gas Properties”). Macquarie Capital Markets Canada Ltd. acted as financial advisor to the Corporation with respect to the transaction.
Pursuant to the transaction, Perpetual will materially increase its liability management ratio as defined by the Alberta Energy Regulator to over 4.2 through the disposition of all of the liabilities associated with the Shallow Gas Properties, and through the retention of its higher netback core, liquids-rich natural gas assets in West Central Alberta as well as heavy oil and natural gas assets in the Mannville and Panny areas in northeast Alberta. Despite the loss of close to 35.5 MMcf/d of current production from the Shallow Gas Properties, Perpetual’s funds flow is expected to be positively impacted as a result of the disposition using current forward prices for natural gas. Furthermore, through gas marketing arrangements related to the transaction, Perpetual retains essentially full natural gas price upside exposure on the forecast base production from the Shallow Gas Properties should AECO natural gas prices exceed $2.81/GJ through August 2018, with no operating exposure or future capital spending commitments.