Progress Energy continues to build upon its leading Montney natural gas position with the completion of two acquisitions in northeast British Columbia
CALGARY, March 12, 2014 /CNW/ - Progress Energy Canada Ltd. (Progress Energy), a subsidiary of Petroliam Nasional Berhad (PETRONAS), has closed its previously announced agreement to acquire assets in northeast British Columbia from Talisman Energy Inc. (Talisman). In a second transaction, Progress Energy has also acquired Montney lands in the Julienne area of northeast British Columbia.
"These two acquisitions continue to build upon our natural gas resource base in the North Montney. With the complementary fit we have captured operational synergies as well as additional strategic assets," said Michael Culbert, President & CEO of Progress Energy.
The acquisition from Talisman includes about 127,000 net acres of Montney lands and has current production of approximately 12,500 barrels of oil equivalent per day (BOE/d). Progress Energy will acquire Talisman's interest in the Kobes area where Progress Energy has existing joint operations with Talisman. In addition, Progress Energy will be acquiring Talisman's 50 percent interest in the Farrell and Cypress areas, where Talisman's partner owns the remaining 50 percent interest. Under the terms of the Talisman agreement, the partner pays a disproportionate share of development costs. The value of this "capital carry" was approximately $870 million at the October 1, 2013 effective date, and will be used to fund the majority of Progress Energy's share of upstream capital investments in the joint venture area over the coming years. This capital carry offsets the total Progress Energy acquisition cost of approximately $1.5 billion.
In January, Progress Energy closed an acquisition in the Julienne area for approximately $130 million which includes 4 Montney wells that are awaiting completion and about 33,500 net acres of undeveloped Montney lands in the heart of the company's North Montney Joint Venture British Columbia holdings.
About Progress Energy
Progress Energy, a leader in Canadian natural gas development, is building upon its history of performance excellence in North America to pioneer new infrastructure for delivering LNG to Pacific Rim markets. Producing more than 400 million cubic feet equivalent of natural gas per day in northeast British Columbia and northwest Alberta, Progress Energy is serving Canadian markets and ambitiously expanding productive capacity on its large Montney land holdings in preparation for the opening of new LNG markets in Asia. Progress Energy is wholly owned by PETRONAS of Malaysia, a global leader in LNG and the principal owner of Vancouver-based Pacific NorthWest LNG Ltd. Progress Energy and Pacific NorthWest LNG are helping craft a bright new future for Canada's energy exports.
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