Crescent Point Acquires Wave


Crescent Point Energy Corp. has agreed to acquire privately held Wave Energy Ltd., which will improve its position in Saskatchewan’s Lower Shaunavon medium-oil resource arena, the Wall Street Journal reported. 


Crescent Point, which recently converted from an income-trust structure, is a conventional oil and gas producer with assets focused in Western Canada.


According to Crescent Point, Wave offers the largest land position in the resource play, with more than 150 net sections of land and access to original oil in place estimated at more than 1 billion net barrels.


Wave shareholders will gain 0.21 of a Crescent Point share for each Wave share, or about C$7.28 a Wave share, according to the terms of the agreement. Crescent Point values the purchase, including the assumption of about C$58 million of net debt, at about C$665.3 million, the Wall Street Journal reported.


The deal is expected to close by Oct. 30, and will allow Crescent Point control of 259 net sections in the strategic core of the Lower Shaunavon resource play.


In addition, Crescent Point plans to acquire producing assets in southeast and southwest Saskatchewan for about C$258.5 million. The assets produce about 3,750 barrels of oil equivalent per day, including 450 barrels per day in the southeast Saskatchewan Bakken light-oil resource play.



Crescent Point also is increasing its expected 2009 capital spending by C$100 million to C$325 million to take into account additional drilling and facilities expansion in its Bakken and Lower Shaunavon resource plays. The company now anticipates a year-end production of 51,500 barrels of oil equivalent per day, up 16% from its previous estimate. Cash flow for 2009 is projected at about C$645 million. To help fund a portion of the acquisitions, Crescent Point plans a bought-deal offering of 5.8 million shares at C$34.50 each to raise about C$200 million. Closing is expected on about Sept. 15.






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