Alvarez & Marsal Canada Inc. - Atikwa Resources Inc. - Western Canada Receivership Sale
Alvarez & Marsal Canada Inc, (A&M), in its capacity as court-appointed receiver of Atikwa Resources Inc. (the “Receiver”), has engaged NRG Divestitures to market the receivership sale of Atikwa Resources Inc. (“Atikwa”), including all of its assets in Alberta, Saskatchewan and Manitoba. The Receiver is offering these assets on an “as is where is” basis, in packages based on geographical location, or en bloc.
The Pierson, Manitoba property (the “Manitoba Property”) is capable of producing Spearfish oil at a stable 45 bbls/d (weather issues have hindered production in recent months). The Manitoba Property contains significant Proved Undeveloped and Probable Undeveloped potential, with 16 potential locations assigned to the former and 32 locations assigned to the latter. The cost structure of the Manitoba Property has been reduced and stabilized thanks to the hiring of a new, Manitoba-based contract operator. The Manitoba Property currently has 9 wells (6 producing wells) that are subject to a significant third-party GORR. The Receiver has included in this brochure hypothetical reserve calculations prepared by Chapman Petroleum Engineering Ltd. (“Chapman”) that show the estimated reserves and net present value of the total proved developed producing, and proved plus probable developed producing, in the hypothetical scenario where the GORR is reduced. We caution that any reduction in the current GORR will require consent of the GORR holder and/or the Court of Queen’s Bench of Alberta (the “Court”). The Receiver will entertain offers which are conditional on a reduction of the GORR, however there is no certainty that such a condition will be satisfied.
The Roncott & Readlyn, Saskatchewan properties (the “Saskatchewan Property”) contains 1,472 ha gross of Bakken rights in this upcoming Bakken area. It has one currently producing Crescent Point operated well, generating stable cash flow of approximately $15k/month.
This package also includes two properties in Alberta (the “Alberta Property”). The Ferrier property includes a producing Belly River gas well, while the Procupine Hills property has 100% interest in 2 sections of land.
There is approximately $21 million in tax pools that may be made available to an interested buyer. Any interested buyer will be required to conduct their own due diligence on the tax pools and separately value these tax pools as part of their overall bid.