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Updated: Wed, 20 Aug 2014 19:29:41 GMT | By The Canadian Press, thecanadianpress.com

Whitecap making $266.7M acquisition

CALGARY - Whitecap Resources Inc. (TSX:WCP) has announced a deal to acquire and consolidate a controlling interest in a conventional Nisku light sweet oil pool in Alberta for $266.7 million in cash.


CALGARY - Whitecap Resources Inc. (TSX:WCP) has announced a deal to acquire and consolidate a controlling interest in a conventional Nisku light sweet oil pool in Alberta for $266.7 million in cash.

The asset, located at Elnora, 80 kilometres east of Whitecap's Garrington core area, will add 2,500 barrels of oil per day equivalent, of which 90 per cent is oil and natural gas liquids.

It also includes strategic facilities consisting of two oil batteries, water disposal infrastructure and pipelines "which will be important for future low-cost production growth," Whitecap said in announcing the deal after markets closed Wednesday.

Meanwhile, Whitecap also said it has entered into an unrelated letter of intent with a private oil and gas company to dispose of approximately 600 boe/d of non-core production for proceeds of $57 million.

The acquisition will be funded with a concurrent $125-million bought deal equity financing, proceeds from the disposition and bank debt. The financing will involved the sale of 7.55 million subscription receipts at $16.55 apiece for gross proceeds of about $125 million. Each receipt receipt will be exchangeable for on Whitecap share.

Meanwhile, Whitecap said its board has approved a 12 per cent increase in its monthly dividend to seven cents per share from 6.25 cents , It is expected to take effect with the January 2015 dividend payable in February.

On the Toronto Stock Exchange, Whitecap stock closed up 37 cents or 2.2 per cent at $17.21 on Wednesday.

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