TORC Oil & Gas to buy light oil assets in Canada

TORC Oil & Gas has agreed to acquire light oil assets in southeast Saskatchewan, Canada, for about $128m.

The transaction includes more than 1,550 boepd of light oil producing assets, which have an average decline rate of about 20%.

TORC has found about 50 conventional light oil drilling locations on the assets which the company claims will offer better economic returns in the Western Canadian Sedimentary Basin in all commodity price environments.

The company expects to maintain the production from the assets by drilling five wells a year with a low decline profile and high quality inventory.

TORC Oil & Gas president and CEO Brett Herman said: "The Acquisition complements our conventional light oil platform and provides a strong and stable cash flow base further strengthening the sustainability of our business model while the high quality drilling inventory will enhance our capital program for years to come."

In connection with the acquisition, TORC has signed an agreement with several vendors to buy all of the issued and outstanding equity stakes of various private firms and a partnership that owns the assets.

TORC has also entered into an unrelated strategic asset swap of common working interests in its non-operated working interest properties in southeast Saskatchewan.

The asset swap includes about 500 boepd of production with same amounts of production and reserves being swapped between parties for no net gain or loss.