Orlen acquires another Canadian producer

Orlen Upstream Canada Ltd., a unit of Polski Koncern Naftowy Orlen SA, has agreed to acquire all shares of Kicking Horse Energy Inc. for $293 million (Can.). The deal was reported just as Orlen Upstream Sp. z o.o. agreed to purchase FX Energy Inc., a Salt Lake City-based producer with assets in Poland (OGJ Online, Oct. 13, 2015).

Total deal value including the assumption of Kicking Horse’s net debt, working capital, and other adjustments is $356 million (Can.). The deal is expected to close in the fourth quarter.

Kicking Horse Energy’s key assets, situated in the region of Kakwa, Alta., carry low risk and “good prospects for growth,” PKN Orlen says. According to the assessment performed as part of the due diligence process, upon the execution of the transaction, Orlen expects to increase its production by more than 4,000 boe/d, and to expand its resource base by 30,000 boe of 2P reserves.

“The experience gained during previous acquisitions makes it possible to achieve upstream synergies,” commented Jacek Krawiec, PKN Orlen’s president of the management board.

“Orlen Upstream Canada began operations on hydrocarbon deposits in Alberta 2 years ago, following the acquisition of TriOil Resources [Ltd.],” he said. “Since that time, we have been able to significantly increase our resource base and production volumes. This new transaction will considerably strengthen our position in this area.”

TriOil’s Alberta-heavy portfolio includes the Cardium development at Lochend, Dunvegan development at Kaybob, and Montney development at Pouce Coupe. PKN Orlen last year purchased Birchill Exploration LP, which discovered and appraised crude oil and natural gas reserves of 26.6 million boe in Alberta’s Ferrier-Strachan areas.

Through the Cardium, Dunvegan, and Montney formations, OKN Orlen produces more than 7,000 boe/d, with 2P reserves of 50,000 boe.

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...