Pengrowth acquires Canadian properties from Murphy Oil

Pengrowth Corp. Calgary, administrator of Pengrowth Energy Trust, agreed to acquire oil and natural gas assets in Alberta and Saskatchewan from a subsidiary of Murphy Oil Corp. for $550 million (Can.) through the purchase of shares in a numbered Alberta corporation.

By OGJ editors

HOUSTON, Apr. 12 -- Pengrowth Corp. Calgary, administrator of Pengrowth Energy Trust, agreed to acquire oil and natural gas assets in Alberta and Saskatchewan from a subsidiary of Murphy Oil Corp. for $550 million (Can.) through the purchase of shares in a numbered Alberta corporation.

The deal is expected to be completed in late May, with an effective date of Apr. 1.

The properties involved are a diverse group in western Canada, including interests in the West Central and Peace River Arch areas, southern Alberta, and heavy oil interests in the Lindbergh, Tangleflags, and Lloydminster areas. Current production from those properties is some 15,500 boe/d, comprised of 46 MMcfd of natural gas, 1,550 b/d of light-to-medium crude and natural gas liquids, and 6,250 b/d of heavy oil.

The acquisition will increase Pengrowth's total production to 62,000 boe/d from the current level of 46,500 boe/d. Total remaining recoverable reserves from the acquired properties are estimated at 43.6 million boe on a proved basis and 54.2 million boe on a proved plus probable basis, based on an engineering appraisal by Sproule Associates Ltd.

As part of that deal, Pengrowth will acquire some 219,000 undeveloped acres.

The acquisition will augment Pengrowth's present interests in the Western Canadian Sedimentary Basin and in the Sable gas fields off Nova Scotia, officials said. They expect the acquisition to be accretive to unit holders of Pengrowth Energy Trust based on production, reserves, and distributable cash.

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