The Divestiture is closed into escrow subject to regulatory approval and license transfers. The Company anticipates closing conditions being satisfied in late January 2021. The effective date of the Divestiture is the closing date, being the 10th business day following the date upon which regulatory approval is received. The Divestiture does not include any working interest in the Company’s Wabasca Crude Oil Transmission Pipeline.
With the recent success of the Clearwater Fairway and its drilling program, the Company considered the Red Earth assets to be non-core in nature. The Divestiture allows the Company to remove approximately $30.0 million of undiscounted, uninflated decommissioning obligations from its schedule of liabilities. Highwood is focusing on the higher netback assets with lower operating costs.