The planned acquisition of “bolt-on” acreage in the Lower Triassic Montney resource play of British Columbia from Paramount Resources Ltd. will enable Seven Generations Energy Ltd. to increase well lengths in an expanded drilling program, the buyer said.
Seven Generations, Grande Prairie, Alta., agreed to buy 99,200 net acres of Montney land from Paramount, Calgary, in a deal worth about $1.9 billion (Can.). The consideration includes $475 million cash, 33.5 million shares of Seven Generations stock, and assumption of $584 million of Paramount’s debt.
The acquired land produces about 30,000 boe/d of gas and liquids and holds proved reserves of 199 million boe. When the deal is complete, Seven Generations will hold 517,300 net acres in the Montney area. The acquisition will add 205 proved, undeveloped drilling locations to the 305 Seven Generations reports now and enable the company to expand its liquids-rich Kakwa River Project in a play it calls Nest.
“We now plan to drill longer wells in the Upper and Middle Montney formation,” said Marty Proctor, Seven Generation president and chief operating officer. “In addition, we expect to add significant potential resource in shallower and deeper formations across our expanded lands.”
The acquisition will add 245 MMcfd of gas processing capacity to the 510 MMcfd of capacity Seven Generations already has and increase its pipeline takeaway capacity to 847 MMcfd from 607 MMcfd.
