Cenovus sells royalty business for $3.3 billion

July 6, 2015
Cenovus Energy Inc., Calgary, inked an agreement to sell its wholly owned subsidiary Heritage Royalty LP to Ontario Teachers’ Pension Plan for gross cash proceeds of $3.3 billion. HRP holds 4.8 million gross acres of royalty interest and mineral fee title lands in Alberta, Saskatchewan, and Manitoba.

Cenovus Energy Inc., Calgary, inked an agreement to sell its wholly owned subsidiary Heritage Royalty LP to Ontario Teachers’ Pension Plan for gross cash proceeds of $3.3 billion. HRP holds 4.8 million gross acres of royalty interest and mineral fee title lands in Alberta, Saskatchewan, and Manitoba.

In this year’s first quarter, Heritage Royalty had associated third-party royalty interest volumes of 7,800 boe/d. Additional royalties have also been added: a royalty on Cenovus’s working interest production with implied first-quarter volumes of 5,400 boe/d and a gross overriding royalty on Cenovus’s Pelican Lake heavy oil property in northern Alberta and its enhanced oil recovery project in Weyburn, Sask., with implied first quarter volumes of 1,600 boe/d.