- Calima Energy (CE1) sells off its Montney assets for nearly A$12 million, which include 33,643 net acres of Montney licenses/acreage and its Tommy Lakes facilities
- The company will distribute $7.5 million shares through 1.2 cents apiece, for a total capital return to shareholders of A$10 million in the last 12 months
- The sale allows Calma to solely focus on maintaining production at its Brooks and Thorsby assets in Alberta, with a guidance of 4000 boe a day for 2023.
- CE1 shares are down 9.78 per cent, trading at 8.3 cents at 3:58 pm AEST
Calima Energy (CE1) has announced the sale of its Montney assets for nearly A$12 million, including 33,643 net acres of Montney licenses/acreage and its Tommy Lakes facilities.
Cash proceeds were received from a Canadian Montney natural gas producer.
According to Calima, notwithstanding the size of the Montney resource, a minimum work program of between C$50 – C$100 million (A$57 – A$114.6 million) is necessary to generate acceptable returns from the Montney Assets.
CE1 CEO Karl DeMong has said that for some time, the company’s share price has not reflected the value of the Monney assets.
“While these assets presented significant future value, the substantial cost of maintaining the existing facilities, building new infrastructure, volatile gas price in NEBC and limited hedging opportunities, has made it very challenging for a small junior to finance the development without substantial equity/project dilution,” he said.
“The disposal of the Montney Assets will result in savings of approximately A$1 million per annum, and allow our resources to be directed and focused on the Brooks and Thorsby production assets and other ventures requiring appropriate capital allocation for an emerging oil and gas company.”
To compensate shareholders, the company will distribute A$7.5 million shares through a payment of 1.2 cents apiece, representing a total capital return to shareholders of A$10 million in the last 12 months.
The sale allows Calima to solely focus on maintaining production at its Brooks and Thorsby assets in Alberta, with a production guidance of 4000 boe a day for 2023.
CE1 shares were down 9.78 per cent, trading at 8.3 cents at 3:58 pm AEST.