Oil and gas producer will use proceeds of sale to pay down debt.
August 29, 2012
by The Canadian Press
CALGARY—Oil and gas producer Calgary-based Fairborne Energy Ltd. says it is selling dry natural gas assets for a total of $189 million.
The company said it has entered into two separate contracts to divest the assets in the company’s greater Marlboro area and its shallow gas/ coal bed methane assets in the Clive area, which together produce about 8,700 barrels of oil equivalent per day.
The deals are expected to close Oct. 1.
The company says that proceeds will be used to pay down its some $185 million of net debt.
Fairborne said that depressed natural gas prices and volatility in capital markets have challenged its ability to fund growth.
The company launched in March a process to weigh its strategic options, which could result in the sale of the company, among other things, with an eye to boosting shareholder value.
©The Canadian Press