Canadian Natural Resources Limited (CNRL) has revealed that it has entered into a deal with Storm Resources Ltd for the acquisition, under a plan of arrangement, of all the issued and outstanding common shares of Storm for a cash consideration of $6.28 per share.
CNRL noted that it will assume Storm’s total debt, working capital deficit and other monetary obligations of approximately $186 million. The transaction value represents approximately one percent of CNRL’s enterprise value and does not materially impact the company’s balance sheet strength or liquidity position, CNRL stated.
Storm’s land and production are located within CNRL’s core area providing opportunity to leverage synergies, CNRL said. Current production, before royalties, to be acquired by CNRL is said to be approximately 136 million cubic feet per day of natural gas and 5,600 barrels per day of NGLs. The deal is targeted to close in December, subject to normal closing conditions.
“This acquisition provides existing production and infrastructure that complements our current assets in the area,” CNRL’s president, Tim McKay, said in a company statement.
“These operating areas provide opportunity for synergies within our current diversified portfolio. We look forward to working together with the staff currently employed by Storm,” he added in the statement.
Storm Resources describes itself as an oil and gas exploration and development company incorporated in the province of Alberta, Canada. The business is the fourth iteration of ‘Storm’ since November 1998, with the same management team involved in the growth and sale of three previous ‘Storm’ companies, Storm’s website states.
In October last year, CNRL announced the closing of its acquisition of all the issued and outstanding common shares of Painted Pony Energy Ltd. The acquired production, infrastructure and land complements CNRL’s natural gas assets in key operating areas, the company noted at the time.
Back in June 2019, CNRL announced that the agreement to acquire all of the assets of Devon Canada Corporation had been completed. The acquired production, infrastructure and land added to CNRL’s existing thermal in situ and primary heavy oil areas, CNRL outlined at the time.
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