West Lake Energy Corp. (“West Lake” or the “Company”) has engaged Sayer Energy Advisors to assist with the sale of its oil and natural gas interests located in the Battle River, Epping, Freemont, Furness, Lashburn, and Tangleflags areas of Saskatchewan (the “Properties”).
Total production net to West Lake from the Properties in the first half of 2024 averaged approximately 392 boe/d, consisting of 390 barrels of heavy oil per day and 13 Mcf/d of natural gas.
Net operating income from the Properties averaged approximately $150,000 per month for the first half of 2024, or $1.8 million on an annualized basis.
West Lake has mapped significant upside on the Properties which resulted in horizontal and vertical drilling locations booked on the Properties and additional unbooked drilling locations, as well as recompletion opportunities.
As of October 8, 2024, the Properties had a positive deemed net asset value of $9.9 million (deemed assets of $23.1 million less deemed liabilities of $13.2 million), with a pre-adjusted LMR ratio of 1.75.
McDaniel & Associates Consultants Ltd. (“McDaniel”) prepared an independent reserves evaluation of the Properties as part of the Company’s year-end reporting (the “McDaniel Report”). The McDaniel Report is effective December 31, 2023 using an average of GLJ Ltd., McDaniel and Sproule Associates Limited’s January 1, 2024 forecast pricing. McDaniel estimates that, as of December 31, 2023, the Properties contained remaining proved plus probable reserves of approximately 2.3 million barrels of oil and 27 MMcf of natural gas (2.3 million boe), with an estimated net present value of $20.4 million using forecast pricing at a 10% discount. The PV values in the chart below include asset retirement obligations for the evaluated wells.
Summary information relating to this divestiture is attached to this correspondence. A package of more detailed confidential information will be sent to any party executing a Confidentiality Agreement (copy attached).
Cash offers relating to this process will be accepted until 12:00 pm on Thursday, November 21, 2024.
Preference will be given to offers to acquire all of the Properties on a white map basis.
For further information please feel free to contact: Ben Rye, Sydney Birkett, or Tom Pavic at 403.266.6133.