Husky purchases property from ExxonMobil Canada and moves forward with Sunrise
Husky Energy has signed a purchase and sale agreement with ExxonMobil Canada Ltd. to acquire oil and natural gas properties in Alberta and northeast British Columbia. The $860 million acquisition will add 21,900 boe per day of production and 113 million boe of proved and probable reserves, based on Husky's reserves estimate.
The ExxonMobil purchase includes 16,300 boe per day of natural gas production, 4,800 barrels per day of oil production and 800 barrels per day of natural gas liquids. Husky's reserve estimate is 104 million barrels of proven oil equivalent and nine million boe of probable reserves, based on an effective date of December 1, 2010. This agreement is subject to regulatory approvals and final closing.
"The properties have very attractive metrics, reflecting our commitment to financial discipline," said Ghosh. "They are located in core operating areas where we will be able to leverage our existing infrastructure to create additional shareholder value."
The purchase of natural gas properties in west central Alberta, announced in September, has now received regulatory approval. The acquisition adds 10,800 boe per day in a core producing area. These acquisitions will increase Husky's near-term production, adding approximately 33,000 boe per day.
Husky and its joint-venture partner are also moving forward with the construction of facilities for the phased development of the Sunrise oil sands lease in the Fort McMurray region of northern Alberta. The first phase, estimated to cost $2.5 billion, is expected to produce about 60,000 bpd gross beginning in 2014.
Sunrise, of which Husky is the operator, will use steam-assisted gravity drainage technology. Sunrise is estimated to have more than 3.7 billion barrels of proved, probable and possible bitumen reserves (127.5 mmbbls proved, 1,895.5 mmbbls probable and 1,685.0 mmbbls possible) as of December 31, 2009 (Husky's share 50%).
Transportation contracts for Sunrise production and diluent and other major contracts for engineering and construction, with a combined value of approximately $2 billion, are progressing and expected to be awarded soon.
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