Production from the non-core assets in 2025 was forecasted to be approximately 1,250 boe/d (55% natural gas), Surge said. (Source: Shutterstock/ Surge Energy)
Calgary, Alberta-based Surge Energy Inc. has closed a sale of its gas-weighted non-core assets in the Valhalla area of Alberta for CA$9.5 million (US$6.6 million), the company said Dec. 19.
Over the past four years, Surge said it has focused on developing its core Sparky and southeast Saskatchewan crude oil assets, leaving the non-core assets undercapitalized for its portfolio.
The Sparky and SE Saskatchewan conventional assets will now represent 90% of Surge’s new 22,500 boe/d 2025 production guidance and more than 95% of its operating cash flow.
Production from the non-core assets in 2025 was forecasted to be approximately 1,250 boe/d (55% natural gas), Surge said.
The company’s current production rate following the transaction’s closing exceeds 22,500 boe/d (91% liquids).
Additionally, the undisclosed buyer has assumed all abandonment and reclamation obligations pertaining to the non-core assets, Surge said.
Proceeds from the deal bring approximately 10 years of future undiscounted free cash flow that the non-core assets would have generated, Surge said.
Surge anticipates allocating the net proceeds from the sale toward additional share buybacks and debt reduction.
National Bank Financial Inc. acted as exclusive financial adviser to Surge for the transaction.
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