FTI Consulting-Trustee for the Estate of Palliser Oil & Gas Corporation-Receivership Sale
FTI Consulting Canada Inc. (FTI) , acting as court appointed Receiver for Palliser Oil and Gas Corporation (Palliser) has engaged NRG Divestitures to market the sale of Palliser’s Alberta and Saskatchewan properties. The properties are currently producing at a combined rate of 280 BOE/D (including 25 BOE/D of non-operated production), consisting primarily of heavy oil.
It is worth noting that average daily production in 2013 was 2,340 BOE/D with operating costs of $18.80/barrel, indicating the potential production capacity of these assets. 2013 proved and probable reserves were calculated to be 9,400,000 BOE, and were valued at $153mm, with a RLI of 12.3.
The Greater Lloydminster area represents the bulk of the current production, with heavy oil being produced from various Mannville Group Formations. The majority of land holdings are 100% working interest and operated. Palliser has employed high volume lift (“HVL”) and Cold Flow Heavy Oil Production (“CHOPS”) techniques to optimize production. HVL, which has been targeting re-activation opportunities, tends to yield oil recovery of >20%, while CHOPS, which has been used on new developments recovers approximately 10% of heavy oil.
The Lloydminster area also includes nine salt water disposal facilities valued at $8.1mm each and 19 salt water disposal wells, all of which are operating significantly below capacity. In addition to potential disposal income, Palliser has identified and seismically delineated over 150 prospective locations on its significant land holdings. 12 easy, low cost reactivation and optimization upside opportunities have been identified in the Manitou Lake and Marsden areas.
This package also includes minor properties throughout Alberta in Medicine Hat, Provost, Wainwright, Auburn Lake, and in Tangle Flags, Saskatchewan.
Please send signed CAs to John Deinum.