By OGJ editors
HOUSTON, May 16 -- Provident Energy Trust launched an offer to acquire Capitol Energy Resources Ltd., Calgary, whose main asset is one of Canada's largest conventional oil discoveries in recent years.
Provident said it would offer $508 million (Can.), including assumption of $41 million in debt. Capitol's board supported the offer.
Provident attributed 90% of the value of Capitol's assets to the Triassic Montney C pool at Dixonville near Peace River, Alta., with original oil in place of 263 million bbl of 30° gravity oil.
Provident estimated that Capitol's production of 4,400 boe/d will grow to 6,000 boe/d in 2008 and 7,000 boe/d in 2009. The Dixonville development plan calls for drilling more than 120 identified horizontal locations in the next few years.
Capitol's yearend 2006 proved reserves of 30 million boe will increase Provident's Canadian proved and probable reserve base by 40%. Consulting engineers' estimate of Capitol's proved, probable, and possible reserves of 57.1 million bbl demonstrate's Dixonville's "outstanding potential for reserves growth through waterflood implementation," Provident said.