Canadian Rigel Energy on the Market
Rigel Energy Corp. of Calgary, a medium-sized Canadian producer,
is opening a data room June 14 to solicit proposals from parties
interested in "making an investment in the equity of the
corporation, merging with the corporation, acquiring certain of
Rigel's assets, or making an offer for 100% of the Corporation,"
according to Don Gardner, Rigel's chief financial officer. A
special committee has been appointed to conduct the process which
"will be broad, open and transparent," Gardner told the company's
The company ranked 26th among Canadian producers with an average
155 MMcf/d of gas production and 491 Bcf of gas reserves and 38.6
million barrels of oil reserves in Canada in 1998. Its Canadian
production was 55% gas. The company also produced 8,200 b/d of oil
from the North Sea in the United Kingdom and had a 11.1 million
barrel foreign reserve in 1998.
The Special Committee, chaired by Board of Directors Chairman
Dick Aberg, is expected to receive bids by mid-August. "To date,
without a solicitation process, we have had a gratifying number of
parties express an interest in attending the data room," said
Gardner. "The initial documents have just been released and we
anticipate that there will be additional interest expressed before
we open for business on June 14th."
Rigel President and CEO Don West, who will be retiring upon
completion of the Special Committee process said, "It's been a
long time since a company with such a powerful combination of
valuable assets and tremendous upside potential became available
in the Canadian oil patch. Any suitor interested in pursuing Rigel
will quickly recognize the value and potential we have created over
the past 20 years."
John Hodgins, chief operating officer, cited the Corporation's
robust exploration program in western Canada as being among the
operating highlights in 1998. Rigel replaced 230% of its 1998
natural gas production from the Western Canadian Basin and 112% of
production from the Peace River Arch.
An industry observer said several Canadian producers currently
are being shopped as owners seek to monetize assets which have
increased in value as the demand for Canadian gas increases.
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