CALGARY, ALBERTA–(Marketwired – Feb. 2, 2017) – Blackbird Energy Inc. (TSX VENTURE:BBI) (“Blackbird” or the “Company“) is pleased to announce that it has entered into a purchase and sale agreement with Paramount Resources Ltd. (“Paramount“) for the acquisition of 8 gross sections of Montney rights (2.8 net) for total consideration of 5 million Blackbird common shares (the “Paramount Acquisition“), and that the Company has acquired 3 gross sections of Montney rights (3 net) through a recent crown land sale (collectively, the “Acquisitions“). These lands (collectively, the “Acquisition Lands“) are contiguous with Blackbird’s existing lands and increase Blackbird’s Montney rights at Elmworth / Pipestone to 102 gross sections (96.8 net). Blackbird is also pleased to announce that it has achieved initial Elmworth / Pipestone Montney production.
Overview of the Acquisition Lands
See Figure 1 below for a map of Blackbird’s current lands and the Acquisition Lands. In total, the Acquisition Lands are comprised of 11 gross sections of Montney rights (5.8 net) which are on strike geologically with Blackbird’s existing lands. The Acquisition Lands are located south of the Wapiti River in close proximity to the Company’s existing infrastructure, and they are contiguous with Blackbird’s existing land block.
To view “Figure 1 – Blackbird’s Current Lands and the Acquisition Lands” associated with this news release, please visit the following link: http://www.marketwire.com/library/20170201-1084670.png
Strategic Rationale for the Acquisitions
The strategic rationale for the Acquisitions is as follows:
- Post-closing of the Paramount Acquisition, Blackbird will hold 102 gross sections of Montney rights (96.8 net) in the prolific Elmworth / Pipestone corridor, with significant blocks of land both north and south of the Wapiti River;
- Combined with Blackbird’s current Elmworth / Pipestone lands, the Acquisition Lands form a large contiguous block of lands south of the Wapiti River in close proximity to Blackbird’s existing infrastructure;
- Management estimates that the Acquisitions add between 88 and 264 gross drilling locations (46 – 139 net) to Blackbird’s drilling inventory south of the Wapiti River (calculated using one mile laterals, two to four intervals per acquired section, and four to six wells per interval). These locations increase the Company’s ultimate reserves and production potential;
- Combined with Blackbird’s current production, the additional drilling inventory located south of the Wapiti River will contribute to Blackbird’s current and future processing and take-away commitments upon the construction of an eastern pipeline gathering system;
- Combined with Blackbird’s current Elmworth / Pipestone drilling inventory, the additional drilling inventory provided by the Acquisitions will help to achieve the scale required to execute large-scale processing and take-away agreements; and
- The Paramount Acquisition allows the Company to increase its Montney land holdings at Elmworth / Pipestone while maintaining its balance sheet strength.
Closing of the Paramount Acquisition is subject to TSX Venture Exchange acceptance and certain other conditions customary for acquisitions of this nature. The anticipated closing date for the Paramount Acquisition is February 15, 2017.
Initial Elmworth / Pipestone Montney Production
On Monday, January 30, 2017 Blackbird achieved initial Montney production at Elmworth / Pipestone. Blackbird’s 5-26, 2-20, 02/2-20 and 6-26 wells are being phased into production over the next several days. The 3-28 well will be tied-in subsequent to a period of soaking, which is meant to imbibe load fluid into the reservoir and reduce water hauling and testing costs. The 2-20/11-9 well will be completed in March, 2017 and then soaked in a similar manner to the 3-28 well. The 2-20/11-9 well will be tied-in upon the construction of an eastern pipeline gathering system.
Blackbird Energy Inc. is a highly innovative oil and gas exploration and development company focused on the condensate and liquids-rich Montney fairway at Elmworth, near Grande Prairie, Alberta.
For more information please view our Corporate Presentation at www.blackbirdenergyinc.com.