Crescent Point Energy Trust, Calgary, (Toronto: CPG.UN) plans to acquire Mission Oil & Gas Inc., Calgary, (Toronto: MSO) for C$760 million in units and debt.
Crescent Point will issue 0.6995 unit valued at approximately C$23 each per Mission share for a total of C$730 million. The company will also assume C$30 million in debt, and had previously acquired 3.8 million Mission shares for C$30 million.
Mission's assets include more than 137,000 net acres (214 sections) of undeveloped land in Saskatchewan, with core areas in the Bakken, Worsley, Neutral Hills and Battle Creek areas. Production is 5,500 BOE per day (90% light oil), with 4,000 bbl. per day from the Bakken play.
Proved reserves are 14 million BOE, with proved-plus-probable reserves of approximately 22 million equivalent.
The Bakken assets are contiguous with Crescent Point's southeast Saskatchewan assets, and the company expects its production in the area will increase from 10,000 to 14,500 BOE per day following the deal.
Pro forma the acquisition, Crescent Point's total production will be more than 26,500 BOE per day (87% oil), its proved reserves will be approximately 76.7 million BOE and proved-plus-probable reserves will be 111.6 million equivalent.
Crescent Point president and chief executive Scott Saxberg says, "We believe Mission's success in drilling over 100 gross wells into the Bakken play and acquiring a dominant position of over 200 sections of land in the play makes this the right time to expose Crescent Point unit-holders to this prolific high-netback light, sweet oil, long-life development play."
Mission president and CEO Trent Yanko says, "We believe in the Bakken resource play built here at Mission and agreed to have Crescent Point as a merger partner because of their proven technical expertise in successfully managing oil development plays."
BMO Capital Markets and Scotia Waterous are financial advisors to Crescent Point. GMP Securities LP and Orion Securities Inc. are financial advisors to Mission, and Tristone Capital Inc. is strategic advisor.
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