acquisitionsNuVista to Buy Cenovus Pipestone Gas Assets for $479 Million
2018-08-10 10:00:00.3 GMT
By Kevin Orland
(Bloomberg) -- NuVista Energy Ltd., a Canadian natural gas
and oil producer, agreed to buy Cenovus Energy Inc.’s Pipestone
assets for C$625 million ($479 million) in cash to expand its
acreage in the Montney shale play.
The Cenovus Pipestone Partnership holds 35,250 net acres of
land in the Montney, increasing NuVista’s holdings in the area
by 29 percent, the Calgary-based companies said Thursday. The
deal will be financed with NuVista’s credit facilities and as
much as C$419 million in share sales.
The acquisition gives NuVista additional production of
9,600 barrels of oil equivalent a day, focused on the condensate
liquid used to dilute oil-sands crude, along with a 39 percent
stake in a gas plant and gathering and compression system. For
Cenovus, the sale will help it pare down the debt it took on in
last year’s $13.2 billion takeover of ConocoPhillips’ Canadian
oil-sands and natural gas assets.
NuVista shares, which were halted pending the announcement,
have gained 7.4 percent this year in Toronto. Cenovus has
climbed 13 percent.