Kelt Exploration Ltd. says it is selling assets in B.C. that account for almost half of its oil and gas production for $510 million in cash to Houston-based ConocoPhillips.
The Calgary-based company says the sale of producing and development assets in the Montney region will leave it with no debt while remaining one of the largest players in the area.
In a separate release, ConocoPhillips says the lands are adjacent to its existing assets and will increase its exposure to the core of the liquids-rich Montney resource.
Kelt says its production will drop from about 30,800 barrels of oil equivalent to 16,500 boe/d when the transaction is completed.
It says ConocoPhillips has also agreed to assume about $41 million in financial obligations related to the purchased assets.
Kelt says its board decided to sell the assets to bolster its balance sheet in the current uncertain economic environment and because its large inventory of future drilling locations was not being reflected in its market valuation.
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