Home Business Tourmaline Purchases Two Oil and Gas Companies in Northeast B.C.

Tourmaline Purchases Two Oil and Gas Companies in Northeast B.C.

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Tourmaline Oil Corporation has announced the acquisition of two oil and gas companies functioning in Northeast B.C. It has also closed the deal which it announced in November. Reportedly, Tourmaline will buy Polar Star Canadian Oil and Gas Inc. and Chinook Energy Inc. The two procurement transactions are of the value of up to $33.4 million. Tourmaline has announced it will buy Chinook’s all of the allotted and remaining common shares. Under a cash consideration, it has decided to offer $0.0675 for one share. Even more, the overall value of the deal is more than $24 million, along with expected liability. Well, the deal could close by this April.

The Chinook Northeast B.C. resources comprise of around 3,500 Barrel of Oil Equivalents (BOEs) and Production, 35.6 Million Barrels of Equivalent Oil (mmboe) of 2P reserves. Even more, it includes 54,000 acres of land, a compressor station, a gas plant, and a 190 million standard cubic feet per day (mmcfpd) regional 12-inch pipeline.

On the other hand, Tourmaline has bought Polar Star Canadian Oil and Gas Inc. on 14th Feb. 2020. The deal costs $9 million for an entire cash consideration, along with adaptations and operating capital. The newly-bought B.C. assets contain around 2,500 boepd of production and 80.7 million standard cubic feet per day of 2P reserves. It also includes about 106,000 net acres of Monteny plots along with a compressor station. Above all, the company anticipates the new effort will lead to a generation of $8-20 million in monetary resources every year. Notably, the estimation relies on present-day gas rates. Minimal development of the assets could take place in the upcoming two years, while Tourmaline constructs a regional facility proposal as a crucial aspect of the further enhancement of these assets.

Tourmaline will primarily focus on increasing production and lessening field costs with the expectation Chinook/Polar Star properties will give out some cash flow. Apart from this, the company aims to deploy a new 9-well pad on construction in the third quarter of 2020 from the purchased lands, with a projected primary production frequency of 15,000 boepd. Tourmaline also intends to sell a gross overriding royalty (GORR) to Topaz Energy on the purchased lands, same as the GORR value of the present-day Tourmaline Gundy property, for around $22.5 million.

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