Waterous Energy Fund combines Strathcona Resources, Osum Oil Sands

Strathcona Resources Ltd. and Osum Oil Sands Corp., portfolio companies of Waterous Energy Fund (WEF) have been combined, continuing the energy investment firm’s consolidation of complementary businesses, the company said June 11.

Strathcona will have 80,000 boe/d (75% oil and liquids) of production, 1.7 billion boe of proved-plus-probable (2P) reserves, and a 60-year reserve life index. As measured by 2P reserves, Strathcona is the largest private-equity owned oil producer in North America and the sixth largest oil-weighted company in Canada, WEF said.

Strathcona is comprised of oil assets hedged with natural gas and condensate production across three core operating areas: Cold Lake thermal oil; Montney condensate-rich gas; and Saskatchewan enhanced oil recovery. 

The combine will continue under the Strathcona name and will remain 100% owned by WEF, WEF co-investors, and Strathcona employees. Strathcona is the product of nine separate transactions completed by WEF since 2017, including three take-private transactions and two bankruptcy situations (OGJ Online, Aug. 14, 2020).

With the combine, Strathcona has secured a new covenant-based $1.0 billion (Can.) credit facility with a syndicate of Canadian, US, and international banks.  This marks the first new covenant-based loan issued to a Canadian oil and gas producer since 2018 and the first ever for a private exploration and production company in Canada, WEF said.

Strathcona will be led by the existing Strathcona management team and board of directors.