CPE News – pcJournal (6/15/2018) – Strath Resources Ltd., a portfolio company of Waterous Energy Fund, has completed previously announced acquisition of Paramount Resources Ltd. (TSX: POU)’s oil and gas properties and related infrastructure at Resthaven / Jayar in the Kakwa region for $340 million.
The consideration to be received by Paramount under the Transaction is comprised of $170 million in cash, 85 million Strath common shares and 10-year warrants to acquire 8.5 million Strath common shares. The cash component will be entirely funded by Waterous Energy Fund.
Paramount now holds 16% equity interest in Strath and Jim Riddell, Paramount’s President and Chief Executive Officer, will join Strath’s Board of Directors.
Strath Resources Ltd. is a private intermediate exploration and production company founded in 2017 to develop condensate-rich natural gas in the Kakwa region of NW Alberta.
photo credit: Strath Resources
July 6, 2018
NEWS RELEASE: PARAMOUNT RESOURCES LTD. CLOSES THE SALE OF ITS OIL AND GAS PROPERTIES IN RESTHAVEN / JAYAR FOR $340 MILLION
Paramount Resources Ltd. (TSX:POU) (“Paramount” or the “Company”) is pleased to announce that it has closed the previously announced sale of its oil and gas properties and related infrastructure at Resthaven / Jayar in the Kakwa region (the “Assets”) to Strath Resources Ltd. (“Strath”). Consideration received by Paramount totaled $340 million, and included $170 million in cash (subject to customary postclosing adjustments), 85 million Strath common shares and 10-year warrants to acquire 8.5 million Strath common shares. As a result, Paramount holds an approximate 16% equity interest (undiluted) in Strath and Jim Riddell, Paramount’s President and Chief Executive Officer, has joined Strath’s Board of Directors. The cash consideration received will be used to reduce outstanding indebtedness under Paramount’s credit facility.
Expected second half 2018 production from the Assets was approximately 5,000 Boe/d (36% liquids), and accordingly, Paramount is revising its 2018 production guidance to be approximately 90,000 Boe/d (~37% liquids). The Company’s capital allocation for the Assets for the balance of the year was nominal and, as a result, Paramount’s 2018 capital budget is unchanged at $600 million.
Paramount is an independent, publicly traded, liquids-focused Canadian energy company that explores for and develops both conventional and unconventional petroleum and natural gas resources, including long-term strategic exploration and pre-development plays, and holds a portfolio of investments in other entities. The Company’s principal properties are located in Alberta and British Columbia. Paramount’s Class A common shares are listed on the Toronto Stock Exchange under the symbol “POU”.
For further information, please contact:
Paramount Resources Ltd.
B.K. (Bernie) Lee, Executive Vice President, Finance and Chief Financial Officer
Rodrigo Sousa, Vice President, Corporate Development
Phone: (403) 290-3600
Fax: (403) 262-7994