Canadian oil and natural gas company Crocotta Energy Inc. (CTA.TO), Thursday, said it has agreed to sell various non-core properties for C$33 million. The company also signed a new bank credit facility for C$58 million and extended its existing bridge credit facility to early February 2010.
Crocotta stated that the sales include seven separate transactions, which are expected to be substantially completed by January 31, 2010.
According to the company, production from the assets agreed to be sold totaled approximately 880 barrels of oil equivalent per day, or boepd. Crocotta reasonably expects that the sales of these assets will reduce its proved reserves by about 1.83 million boe and proved plus probable reserves by about 2.49 million boe. This is equal to sales metrics of $37,500 per boepd, $17.95 per boe based on proved reserves, or C$13.24 on a proved plus probable basis.
Crocotta also estimates that current production net of the asset sales would be in the range of 2,400 - 2,500 boepd, comprising 67% natural gas and 33% light oil and natural gas liquids.
Further, Crocotta stated that the closing of the bank credit facility is subject to the completion of the asset sales and the retirement of the bridge facility. Upon completion of the asset sales, the company will have about C$50 million net debt and will have retired the bridge facility.
Additionally, the company revealed its plan to actively pursue the development of its core resource plays in the Montney, Bluesky and Cardium formations. Further information on the scope and timing of such projects is expected to be released prior to the end of January 2010, the company added.
CTA.TO closed Wednesday's trading at C$1.00 on the TSX, down C$0.02, on 6,900 shares.
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