Steel Reef to acquire Crescent Point certain Saskatchewan assets for $500M

Steel Reef Infrastructure Corp., a portfolio company of InstarAGF Essential Infrastructure Fund and PFM Capital, has entered into a definitive agreement to purchase certain associated gas gathering, processing and sales infrastructure assets in Saskatchewan from Crescent Point Energy Corp. for total cash consideration of $500 million.

Steel Reef will purchase and operate nine natural gas processing facilities and their associated gathering systems and two gas sales pipelines with a total throughput capacity of more than 90 million cubic feet per day. As part of the Agreement, the Company has also successfully secured long-term takeor-pay commitments from Crescent Point and retains the right to market unreserved capacity to third parties. In addition, Steel Reef has committed to fund a $30 million expansion of one of the gas processing facilities purchased.

RBC Capital Markets acted as exclusive financial advisor to Crescent Point Energy Corp. on this sale. GMP FirstEnergy represented Crescent Point as its strategic advisor. The transaction is expected to close in first quarter 2020.

Steel Reef will fund the acquisition by its existing investors and financers.

photo credit: Crescent Point Energy

News Release

Steel Reef Announces $500 Million Acquisition of Assets with Long-Term Take-or-Pay Commitments

CALGARY, ALBERTA – (November 14, 2019) – Steel Reef Infrastructure Corp. (“Steel Reef” or the “Company”) is pleased to announce it has entered into a definitive agreement (the “Agreement”) to purchase certain associated gas gathering, processing and sales infrastructure assets in Saskatchewan from Crescent Point Energy Corp. (“Crescent Point”) for total cash consideration of $500 million.

“This attractive investment is in line with Steel Reef’s responsible growth model and secures long-term benefits for our valued shareholders and customers,” said Scott Southward, President and CEO. “We are pleased to further strengthen our relationship with Crescent Point in a best-in-class resource base.”

Under the terms of the agreement, Steel Reef will purchase and operate nine natural gas processing facilities and their associated gathering systems and two gas sales pipelines with a total throughput capacity of more than 90 million cubic feet per day. As part of the Agreement, the Company has also successfully secured long-term takeor-pay commitments from Crescent Point and retains the right to market unreserved capacity to third parties. In addition, Steel Reef has committed to fund a $30 million expansion of one of the gas processing facilities purchased.

The purchase price will be satisfied by the Company’s existing investors and financers. This transaction is expected to close in first quarter 2020, subject to customary closing conditions and regulatory approvals.

About Steel Reef Infrastructure Corp.:

Formed in 2012, Steel Reef is a privately held midstream company which owns and operates high-quality processing and transportation facilities. The Company is focused on strategically partnering with oil and gas exploration, development and production companies to develop a portfolio of midstream assets, through acquisition or construction, with a view to generating a regular dividend for its investors. Notwithstanding the funds associated with this announcement, Steel Reef has deployed approximately $450 million into a cohesive portfolio of assets since inception.

CONTACT INFORMATION
Scott Southward
President and Chief Executive Officer
(403) 263-8333

William Champion
Chief Financial Officer
(587) 391-1319

Ted Liu

Ted Liu, M.Sc. (Mining, Queen's), MBA (Finance, Toronto), is the Editor of Private Capital Journal, CanadaMetals.ca, TechWire.ca, and the former Editor of Canadian Private Equity. Ted has been passionately tracking Canadian private capital industry since 1992, having most recently served as Research Director for The Canadian Venture Capital and Private Equity Association (CVCA).

Ted is the architect of CVCA infobase, and is the architect of CPE Media's Financings.ca, Canada's most sophisticated and advanced all private capital and public market financing database.