Husky Energy to sell interests in Western Canada oil properties for $163m

Husky Energy has signed an agreement to sell royalty interests in oil properties in Western Canada to Freehold Royalties, in a transaction valued at $163m.

The company’s properties represent about 1,700 barrels of oil equivalent per day of expected production during 2016.

The transaction will enable Husky to obtain a value on the royalty income stream from these lands.

Husky will also receive royalty and working interests in select heavy oil properties in the Lloydminster area, which will contribute to the growing Lloyd thermal portfolio.

The company’s primary focus is on core plays, including the Wilrich and Montney.

Husky said that the transition is part of its overall strategy to grow quality production and maintain a diversified portfolio.

The latest news follows Husky’s announcement made in April 2016, for the sale of 65% of its ownership interest in oil and gas processing assets to Hong Kong-based Cheung Kong Infrastructure and Power Assets for $1.7bn.

Husky will retain a 35% stake in these midstream assets within the Lloydminster region of Alberta and Saskatchewan.

The company plans to use proceeds from these transactions to strengthen the balance sheet and will continue to advance with regard to the disposition of select oil and natural gas properties in Western Canada.