Barrel Oil Corp (“Barrel” or the “Company”) has engaged Sayer Energy Advisors to assist it with the sale of its oil and natural gas interests located in the Coyote area of Alberta (the “Property”).
At Coyote, Barrel holds primarily a 100% working interest in 18.75 sections of land. Production from Coyote is primarily from the Mannville Group.
Average daily sales production net to Barrel from Coyote for the third quarter of 2023 was approximately 126 boe/d, consisting of 73 bbl/d of oil and natural gas liquids and 319 Mcf/d of natural gas.
Operating income net to Barrel from Coyote for the third quarter of 2023 was approximately $72,000 per month, or $865,000 on an annualized basis.
As of December 2, 2023, the Coyote property had a deemed net asset value of $2.0 million (deemed assets of $4.8 million and deemed liabilities of $2.8 million), with an LMR ratio of 1.72.
Based on geologic and geophysical mapping, Barrel has identified seven two-mile horizontal Ellerslie locations and one one-mile horizontal Ellerslie location on the Property. Additionally, the Company has identified four parcels of land that have potential in the Ellerslie reservoir which can be developed with vertical step-out wells, then followed up with horizontal drilling.
Trimble Engineering Associates Ltd. (“Trimble”) prepared an independent reserves evaluation of the Property (the “Trimble Report”). The Trimble Report is effective September 30, 2023 using Trimble’s October 1, 2023 forecast pricing. Trimble estimated that, as at September 30, 2023, the Coyote property contained remaining proved plus probable reserves of 138,000 barrels of oil and natural gas and liquids and 645 MMcf of natural gas (245,000 boe), with an estimated net present value of $1.0 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).
Proposals relating to this process will be accepted until 12:00 pm on Thursday, February 8, 2024.
For further information please feel free to contact: Ben Rye, Sydney Birkett, or Tom Pavic at 403.266.6133.