Private Canadian company Ember Resources Inc. has agreed to purchase oil and natural gas producing properties in the Nevis, North Grant Lands, and South Grant Lands areas of western Alberta from Houston independent Apache Corp. for $214 million.
The assets comprise 621,000 gross acres (530,000 net acres) and more than 2,700 wells that had average net production in this year’s second quarter of 67 MMcfd of gas and 237 b/d of liquid hydrocarbons from late Cretaceous sands and coal seams, Apache reported, adding that the company will retain 100% working interest in horizons below the Cretaceous, such as potential Duvernay and Nisku, in Nevis and North Grant Lands.
“Going forward, Apache is focused on growing our liquids production from a deep inventory of crude oil- and liquids-rich opportunities that generate attractive rates of return on our extensive remaining acreage in Canada’s Western Sedimentary Basin,” said Rodney J. Eichler, president and chief operating officer. “We also remain focused on advancing the Kitimat LNG project to monetize large unconventional resources in the Liard and Horn River basins in northern British Columbia,” he said.
Apache previously announced plans to divest $4 billion in assets by yearend (OGJ Online, May 9, 2013). The company intends to use proceeds from the asset divestitures to reduce debt and enhance financial flexibility and to repurchase Apache common shares under a 30-million-share repurchase program authorized by its board earlier this year, it said.
In July, Apache announced an agreement to sell its Gulf of Mexico Shelf operations and properties to Riverstone Holdings affiliate Fieldwood Energy LLC for cash proceeds of $3.75 billion (OGJ Online, July 18, 2013).
This latest divestiture, said Eichler, “is one element of a comprehensive review of Apache’s portfolio to determine which assets make the most sense for Apache to own given our growth and return objectives and which assets are better owned by others,” adding, “The Nevis, North Grant Lands, and South Grant Lands assets fit in the latter category.”
The effective date of the transaction is Apr. 1, and it is expected to be completed during the third quarter, subject to customary regulatory approvals and other closing conditions.