Zargon Oil & Gas Ltd has entered into a definitive agreement for the sale of all of its Southeast Saskatchewan assets. The effective date of the transaction is 1 July 2016 and the transaction is expected to close in early September. The assets have the following attributes:
- Production: 1211 boe/d of low decline production – 95% oil and liquids (1H16).
- Proven plus probable reserves: 5.14 million boe – 96% oil and liquids.
The proceeds of the transaction will initially be used to eliminate Zargon's bank debt. As outlined below, Zargon's net debt (including debentures) will be approximately CAN$35.0 million following the transaction:
- Bank debt and net working capital - CAN$65.0 million as of 30 June 2016.
- Net sale proceeds after closing adjustments - CAN$87.5 million.
- Outstanding June 2017 Convertible Debentures - CAN$57.5 million.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/26072016/zargon-oil-gas-ltd-announces-sale-of-southeast-saskatchewan-assets-2830/