Surge Energy Makes ‘Exciting Reentry’ with Astra Oil Acquisition
Surge Energy had previously exited the region through the sale of its southeast Saskatchewan and Manitoba assets in 2015 to Torc Oil & Gas for CA$430 million.
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Surge Energy Inc. agreed to acquire Astra Oil Corp., which the company said represents an “exciting reentry” into southeast Saskatchewan for the Surge team.
The Astra acquisition will be funded through the issuance of Surge common shares and the assumption of approximately CA$15 million of net debt for total consideration of roughly CA$160 million. The assets include more than 4,100 boe/d (90% liquids) of operated, light oil production with an operating netback of more than $42 per boe at US$65 WTI pricing.
Whitecap Returns to Profitability on Canada Oil, Gas Acquisitions and Higher Prices
Improved prices for increased oil, natural gas and liquids volumes, achieved in part on corporate takeovers, fueled a return to profitability by Canadian producer Whitecap Resources Inc. in the first three months of this year.
Whitecap oil production volumes grew year/year to 64,795 b/d from 56,631 b/d, with natural gas volumes hitting 129 MMcf/d from 70.5 MMcf/d. Natural gas liquids (NGL) volumes increased to 9,508 b/d from 5,077 b/d.
Volume growth resulted from takeovers last year of Torc Oil & Gas Ltd. and NAL Resources Ltd. Whitecap set its stage for further growth with a deal in early April to acquire Kicking Horse Oil & Gas Ltd., which has a portfolio of Montney Shale gas and NGL assets.
Estevan– Mid-February to the first week of March is traditionally the peak of the year for oilwell drilling activity. And on Feb. 22, there were 31 drilling rigs working in Saskatchewan, down markedly from the previous two years. According to Rig Locator (riglocator.ca), in 2020 there were 65 rigs working on the same date, and 52 rigs working on that date in 2019. During the boom years, from 2008-2014, there would be closer to 100 rigs working. While the current number couldn’t be considered great by any means, it is significantly higher than the zero rigs that were drilling in the first part of the summer of 2020, when oil markets were initially recovering from the shock of the COVID-19 pandemic.
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Regina – Husky Energy, which was acquired by Cenovus Energy, had been Saskatchewan’s top oil producer for the first 11 months of 2020. According to the Saskatchewan Ministry of Resources, from January to November, 2020, Husky produced 31.7 million barrels of oil. It has been the dominant player in northwest Saskatchewan. That will now revert to Cenovus, as of Jan. 1, when the deal closed. Crescent Point Energy Corp. came in second, at 27.7 million barrels. Crescent Point is the leading player in southeast and southwest Saskatchewan, and an active driller in west central Saskatchewan. Whitecap Resources Inc. was third at 15.8 million barrels. Whitecap is active in southeast and southwest Saskatchewan.