Apache Corp. made a definitive agreement to acquire producingproperties and other assets in Alberta, British Columbia andSaskatchewan, Canada with proved reserves of 87.5 MMBoe from ShellCanada Limited for C$770 million (US$524 million at currentexchange rates).
The purchase, through Apache’s wholly-owned subsidiary ApacheCanada Ltd., also includes 294,294 net acres of undeveloped leaseholdings, 100% interest in a gas processing plant with a potentialcapacity of 160 MMcf/d, and 52,700 miles of 2-D seismic and 884square miles of 3-D seismic, ranking among the largest proprietaryseismic data banks in Canada.
The deal will be effective Nov. 1 and is expected to close nolater than Nov. 30, subject to U.S. and Canadian regulatoryapprovals.
Apache plans to fund the purchase from its $1 billion globalcredit facility, bringing the company’s debt-to-capitalizationratio to an estimated 42%. Apache said the acquisition is expectedto add immediately, on a per-share basis, to its reserves,production, earnings and cash flow.
The properties’ proved reserves comprise about 67 MMB crude oil,5.8 MMB of natural gas liquids and 88 Bcf of gas.
“This is a strategic step for Apache in Canada,” said G. StevenFarris, president. “With its quality production, large prospectiveacreage position and proprietary seismic data base — along withthe unprecedented opportunity to add a quality team of Shelltechnical personnel — this acquisition transforms our Canadianregion into a substantial growth area.”
Apache CEO Raymond Plank said, “Including this transaction,we’ve acquired about US$1.4 billion in assets this year. We believethere is an unprecedented opportunity to buy quality North Americanproperties, and Apache intends to remain a significant player.”
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