Sayer Energy Advisors has been engaged to assist Journey Energy Inc. (“Journey” or the “Company”) with the sale of certain non-core operated properties located in the Brooks, Gilby, Gull Lake, Niton and Pembina Keystone Cardium Unit No. 1 areas of Alberta, and non-operated interests in the Pembina area of Alberta (the “Properties”).
Total production net to Journey from the Properties has recently averaged approximately 1,440 boe/d, consisting of 3.9 MMcf/d of natural gas and 792 barrels of oil and natural gas liquids per day.
Recent net operating income from the Properties has averaged approximately $569,000/month or approximately $6.8 million on an annualized basis.
The Properties consist of high working interests in low decline oil and natural gas production and associated infrastructure.
As of September 1, 2018, the Properties had a positive net asset value of approximately $24.0 million (deemed assets of $55.3 million and deemed liabilities of $31.3 million), with an overall LLR ratio of 1.77.
GLJ Petroleum Consultants Ltd. (“GLJ”) prepared an independent reserves evaluation of Journey’s properties as part of the Company’s year-end reporting (the “GLJ Report”). The GLJ Report is effective December 31, 2017 using an average of three Consultant’s forecast pricing at January 1, 2018.
GLJ estimates that, as of December 31, 2017, the Properties contained remaining proved plus probable reserves of 3.1 million barrels of oil and natural gas liquids and 13.5 Bcf of natural gas (5.4 million boe), with an estimated net present value of $42.6 million using forecast pricing at a 10% discount.
Summary information relating to this divestiture is attached to this correspondence. More specific information is available at www.sayeradvisors.com. A package of more detailed confidential information will be sent to any party executing a Confidentiality Agreement (copy attached).
Cash offers to acquire the Properties will be accepted until 12:00 pm on Thursday, November 15, 2018.
For further information please feel free to contact: Tom Pavic, Ben Rye, Mark Zalucky, Grazina Palmer, Ryan Ferguson Young or myself at 403.266.6133.
Alan W. Tambosso, P.Eng. P.Geol.
SAYER ENERGY ADVISORS
1620, 540 – 5th Avenue SW
Calgary, Alberta T2P 0M2
P: 403.266.6133 C: 403.650.8061 F: 403.266.4467