Monday, February 14, 2011

Over the last two weeks, four companies have been put up for sale in Alberta

Over the last two weeks four companies have been put up for sale in Alberta with more than 15 MMBOE of gross proved reserves and 93,333 net acres.

Seven Energy (Canada) Inc put up for sale

Seven Energy (Canada) Inc has retained Peters & Co Limited as its exclusive financial advisor to coordinate all aspects of shareholder value maximization process.

-- Viking oil resource opportunity: 10.5 net sections (6,720 net acres) of contiguous land, highly prospective for Viking oil horizontal development with over 30 potential locations
-- Edmonton sands: 13,948 net acres (95% operated) of contiguous Edmonton and Horseshoe Canyon rights
-- Mannville: ~9,000 net acres of Lower Mannville rights; Excellent recompletion and drilling opportunities across the acreage
-- Purpose built facilities: The company owns and operates an 8 MMcf/d refridge gas plant and ~70 km of pipeline, purpose built for shallow and solution gas production
-- Current production of approximately 281 BOE/d (Gas 85%)
-- Total Proved reserves: 2,468 MBOE (Gas 91%, PDP 32%, NPV10 of $22 million)
-- Low risk development: 29 Mannville and Viking recompletion opportunities including 9 highgraded zones (recognized by AJM) capable of doubling current production with a small capital expenditure requirement (~$750,000)
-- CBM upside: Opportunity to recomplete the Horseshoe Canyon coals in all current producing Edmonton sand wells
-- Financial advantage: Tax pools of ~$35.8 million as at November 30, 2010.

White North Energy put for sale

Sayer Energy Advisors has been engaged to sell the shares of White North Energy Corp, a private Alberta corporation which holds operated working interests in two producing light oil properties just west of Brandon, in the Sinclair and Pierson areas of southwestern Manitoba.

-- Sinclair area: White North holds high working interests, mainly 50%-100% but ranging from 12.5% to 100% in 13.5 sections of land on which it has partially developed some light oil reserves in the Bakken/Torquay formations.
-- Pierson areas: White North holds various interests, ranging from a GOR to a 50% working interest, in 2.25 sections of land. The company has drilled one oil well at Pierson (50% WI), which is currently producing approximately 3-4 BO/d (2 BO/d net to White North).
-- According to AJM reserve report, effective 31 Dec 2010, Total Gross Proved reserves - 671 MBO (PDP 36%, Oil 100%, NPV10 of $16 million); Gross Proved + Probable reserves – 1,117 MBO (Oil 100%, NPV10 of $31 million).
-- Recent production from the properties has averaged approximately 165-170 BO/d. Three recently-drilled wells which are coming on stream by March 1, 2011 are expected to add an additional 80-85 BO/d, for a total current net production capability of approximately 250 BO/d.
-- Identified a minimum of 19 drilling locations on its operated lands and three locations on its non-operated lands at Sinclair area.

Venturion Natural Resources put up for sale

Venturion Natural Resources Ltd has retained BMO Capital Markets to seek proposals for a corporate sale.

-- Venturion, an oil-focused private growth company, has 100% WI and is operator of three major oil properties in Alberta
-- Total OIIP of 70 MMBO with low current recovery factor
-- Current production of approximately 2,800 BOE/d is 86% oil weighted (2,400 bbl/d, 10 bbl/d NGL, 2,340 Mcf/d gas)
-- Low base corporate production decline rate (<10%)
-- Low operating cost ($9.93/BOE), high net back ($33.74/BOE) production with brand new major facilities and gathering systems
-- Waterfloods have been implemented at Killam and Worsley with positive response
-- Low-risk, repeatable, go-forward development drilling and expansion opportunities at Worsley
-- Future reserves growth through positive technical revisions as waterfloods progress
-- Worsley: 26,400 net acres of contiguous land base; Current production is 1,900 BOE/d of 16 degree API oil and associated gas; Positive results from recently drilled horizontal step-outs and infills in the Gething/Montney A pool; Increasingly widespread positive impact of recent waterflood implementation
-- Killam: Lloydminster sand reservoir development started in 2007; Subsequent development with dual leg horizontal producers and vertical water injectors; Waterflood is having a significant positive impact on production; Current production is approximately 470 BOE/d of 24 degree API oil
-- Retlaw: Reliable source of low operating cost production; Current production is approximately 430 BOE/d; Oil and gas production from Mississippian (18 degree API) and Cretaceous (25 degree API) reservoirs.

ProspEx Resources considers strategic alternatives

ProspEx Resources Ltd has initiated a process to identify, examine and consider a range of strategic alternatives available to the company with a view to enhancing shareholder value. Such strategic alternatives may include, among other alternatives, a sale of a material portion of the assets of the company, a sale of the company, either in one transaction or in a combination of transactions, a merger or other business combination, or a farm-in, farm-out or acquisition. The company has retained Cormark Securities Inc as its financial advisor to assist in this sale.

-- Core areas: Kakwa area in Deep Basin and Pembina area in West Central Alberta.
-- Kakwa area: Holds 50% average working interest in large contiguous land position; 3D seismic database defines play trend; 21 (10.5 net) undrilled locations in inventory; Prolific production from horizontal wells of 230 BO/d plus 6.5 MMcf/d.
-- Pembina: 3,840 net acre land position; All held at 100% working interest; 7 gross (7 net) undrilled locations in inventory.
-- BC Montney project: ProspEx has assembled a largely contiguous, 25,000 acre (36 section), 100% working interest land position in the Montney play in the Birch area; Planning to drill a horizontal well in the Upper Montney in the first quarter of 2011; Potential for a significant drilling inventory of up to 200 locations.
-- During fourth quarter of 2010, the company’s production was 3,463 boe per day.
-- According to GLJ report, effective 31-Dec-2010, Proved reserves – 11,897 MBOE gross and 10,211 MBOE net (PUD 36%, NPV10 - $147 million, Oil 19%); Proved + Probable reserves – 18,594 MBOE gross and 15,813 MBOE net (NPV10 - $218 million, Oil 20%).
-- The company's Proved + Probable reserve life index at December 31, 2010 was estimated to be 14.7 years and the proved reserve life index was 9.4 years.

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