Sayer Energy Advisors has been engaged to assist PricewaterhouseCoopers Inc., LIT (“PwC”) in its capacity as Court-appointed receiver (the “Receiver”) of SanLing Energy Ltd. (“SanLing” or the “Company”) with the sale of all of the Company’s oil and natural gas properties located in Alberta and British Columbia (the “Properties”).
On April 23, 2021, the Receiver was appointed by the Court pursuant to an application made by the Orphan Well Association (“OWA”) and the BC Oil and Gas Commission (the “BCOGC”) and intends to divest the Properties, in whole or in part.
The Properties consist of both operated and non-operated interests which are located throughout Alberta and British Columbia. The Properties are separated into the following geographical packages for this offering: Southern Alberta Oil, Southern Alberta Gas, Matziwin, Drumheller, Provost, Pembina, North Oil, Peace River Arch, Rainbow Oil, and Rainbow Gas in Alberta, as well as Noel, Lagarde and Northeastern BC in British Columbia.
On March 31, 2021, SanLing ceased its operations in Alberta and British Columbia.
Average production net to SanLing from the Properties in 2020 was 4,368 boe/d, consisting of 20.2 MMcf/d of natural gas and 1,000 barrels of oil and natural gas liquids per day.
As of March 6, 2021, SanLing’s net deemed asset value in Alberta was ($69.3 million) (deemed assets of $110.0 million and deemed liabilities of $179.3 million), with an LMR ratio of 0.61.
As of February 23, 2021, SanLing’s net deemed asset value in British Columbia was ($4.4 million) (deemed assets of $7.0 million and deemed liabilities of $11.4 million), with an LMR ratio of 0.62
GLJ Ltd. (“GLJ”) was commissioned by SanLing to prepare a mechanical update of its oil and natural gas reserves effective December 31, 2019 (the “GLJ Report”). The evaluation was initiated in May 2020 and completed by June 2020. Estimates of reserves and projections of production were generally prepared using well information and production data available from public sources to approximately December 31, 2019. The Company provided land, accounting data and other technical information not available in the public domain to approximately December 31, 2019. In certain instances, the Company also provided recent engineering, geological and other information up to December 31, 2019. The Company has confirmed that, to the best of its knowledge, all information provided to GLJ is correct and complete as of the effective date.
The GLJ Report is effective December 31, 2019, using Sproule Associates Limited’s December 31, 2019 forecast pricing. GLJ estimated that as of December 31, 2019 the Properties contained remaining proved plus probable reserves of 8.0 million barrels of oil and natural gas liquids and 121.9 Bcf of natural gas (28.3 million boe), with an estimated net present value of approximately $99.8 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.
Offers relating to this divestiture will be accepted until 12:00 pm on Thursday June 24, 2021.
For further information please feel free to contact: Ben Rye, Grazina Palmer, or Tom Pavic at 403.266.6133.