Trinity Exploration and Production to be acquired by Touchstone Exploration

Touchstone Exploration has entered into a definitive agreement to acquire Trinity Exploration and Production in an all-stock transaction valued at approximately $30.1 million. This deal represents a strategic move to enhance Touchstone’s operational scale and resource base in Trinidad and Tobago, where both companies are significantly engaged in crude oil exploration, development, and production.

Details of the Transaction

Under the terms of the acquisition, shareholders of Trinity Exploration and Production will receive 1.5 shares of Touchstone Exploration for each share they currently hold. Post-transaction, Touchstone Exploration’s shareholders will own about 80% of the combined entity, with Trinity’s shareholders owning the remaining 20%.

Expanded Production and Reserves

The merger is expected to create a formidable entity in the region, with a combined daily production ranging from 11,700 to 12,400 barrels of oil equivalent per day (boe/d) based on the 2024 production forecasts from each company. Additionally, the merged entity will control combined estimated proved plus probable reserves of approximately 80.3 million barrels of oil equivalent (MMboe) as of the end of 2023.

Touchstone Exploration agrees to acquire Trinity Exploration and Production, enhancing its oil production capabilities and reserves in Trinidad and Tobago.

Operational Synergies and Growth Opportunities

The integration of Trinity’s assets with Touchstone’s existing operations is anticipated to deliver substantial operational synergies. Trinity operates seven onshore oil blocks and several offshore platforms that produced a total of 2,790 barrels per day in 2023. These assets will complement Touchstone’s ongoing projects, enhancing the company’s ability to deliver growth in reserves, production, and cash flows.

Executive Insights

Touchstone Exploration’s president and CEO, Paul Baay, expressed optimism about the acquisition, stating, “We believe this acquisition represents a compelling strategic opportunity which will deliver enhanced scale, balance sheet strength, and growth opportunities. The business combination will create an upstream oil and natural gas company of increased scale in Trinidad, enhancing our ability to deliver growth in reserves, production and cash flows for the benefit of our combined shareholders and local stakeholders.”

Regulatory and Shareholder Approvals

The completion of the deal is contingent upon regulatory approvals, stock exchange consents, and the approval of Trinity Exploration and Production’s shareholders, with a targeted closing by the end of Q3 2024.

This acquisition by Touchstone Exploration is poised to redefine the company’s presence in Trinidad and Tobago, setting a new benchmark for growth and efficiency in the region’s energy sector.