Donnycreek Energy (TSX: V.DCK, Stock Forum) strengthened its position in the Deep Basin located in Alberta, Canada, when the company announced today that it had entered into an arm's length definitive merger agreement with Contact Exploration to form a new amalgamated corporation to be known as, “Kicking Horse Energy”.
According to the news release, the merger was meant to consolidate both companies' interest in the Deep Basin including their working interests (“WI”) in their Kakwa (East) property in Alberta.
Presently, the company holds 50% WI in 16.75 gross sections at the Kakwa property with Contact being the 25% WI operator at Kakwa. Considering current WI production, Kicking Horse is expected to have approximately 3,000 boe/d of Montney production from the property.
The deal also includes the company's operated working interest in 380 gross sections of petroleum and natural gas rights at Wapiti (75% WI) and West Kakwa (40% WI) as well as two gross sections (24% WI) and two gross sections (64% WI) contiguous to the Kakwa Property combined with Contact's 100% working interest in 11 gross sections at West Kakwa, 27 gross sections at Chime and 23 gross sections at Pinto.
Upon completion of the merger, Kicking Horse will have approximately 60.6 million shares outstanding and will be managed by Steve Harding as President and CEO, Raymond Sully as COO, Chad Kalmakoff as VP Finance and CFO, Mark Hadley as VP Exploration and Paul Poohkay as Production Manager.
Donnycreek was in the news recently when the Calgary-based company provided a corporate update less than a week ago.
Shares climbed 32.63% on the news to $2.52 per share.
Currently there are 55.2m outstanding shares with a market cap of $139.0 million.