Crescent Point Energy to acquire Kaybob Duvernay assets of Paramount Resources

Crescent Point Energy, a Canada-based oil and gas company, has agreed to acquire certain Kaybob Duvernay assets in Alberta from Paramount Resources for CAD 375 million ($275.49 million) in cash.

The acquisition is said to increase Crescent Point Energy’s drilling inventory in the play to more than 20 years and improve its land position to around 400,000 net acres.

Situated adjacent to Crescent Point Energy’s current land base, the assets will add around 130 net drilling sites that currently produce more than 4,000 barrels of oil equivalent a day (boe/d).

The assets also include a gas facility, related pipelines, seismic data, and water infrastructure.

Crescent Point Energy to acquire Kaybob Duvernay assets of Paramount Resources. Photo courtesy of Anita starzycka from Pixabay.

Craig Bryksa — Crescent Point Energy President and CEO said: “Through this acquisition, we are increasing our drilling inventory in the play to over 20 years, based on current production.

“In addition, our land position will increase to approximately 400,000 net acres.

“We are also adding base production with an estimated net present value of approximately $200 million at current strip commodity prices.

“The acquisition includes an attractive ESG profile, consistent with our existing Kaybob Duvernay assets, including low emissions intensity and minimal asset retirement obligations.”

The transaction, which will be financed through current credit facilities, is anticipated to complete in January 2023.

Crescent Point Energy intends to increase its assets in the Kaybob Duvernay from around 35,000 barrels of oil equivalent per day (boe/d) in 2022 to more than 55,000 boe/d as part of the company’s five years strategy and add a second rig in the play in 2024.

The company said its “2023 annual average production guidance is now 138,000 to 142,000 boe/d, an increase of 4,000 boe/d, with development capital expenditures unchanged at $1.0 to $1.1 billion.”

Crescent Point has simultaneously increased the first quarter 2023 base dividend by 25% to 10 cents per share.