Pine Cliff Energy Ltd T.PNE

PNE up after reporting deal...

[zack50]

01:03 PM EST, 12/21/2021 (MT Newswires) -- Pine Cliff Energy Ltd. (PNE.TO) on Tuesday rose 1.6% on last look after reporting a deal to buy all of the issued and outstanding common shares of a privately held oil and gas company for $22.2 million in cash.

The deal will add about 1,900 barrels of oil per day of low decline production and 100% ownership in strategic crude oil and natural gas infrastructure that will lower Pine Cliff's Ghost Pine area operating costs.

Pine Cliff has also identified development drilling opportunities in the acquired assets that appear to be comparable to the company's recent Pekisko crude oil and Mannville natural gas drilling locations.

Also, the company secured a demand loan facility with Canadian Western Bank for nearly $5 million of borrowings at an interest rate of Canadian Prime rate plus 2.0%. The facility, which is currently undrawn, is expected to help the company with working capital management and is not required to fund the acquisition.

Separately, the company said the two gross Pekisko wells drilled in the Ghost Pine area during the third quarter, averaged a combined 360 Boe/d. Pine Cliff drilled and completed one gross Mannville natural gas well in the Ghost Pine area that was tested and placed on production on Dec. 11.

Pine Cliff also drilled two additional Pekisko oil wells in December in the Ghost Pine area which are expected to be placed on production in early January 2022.