Pieridae Energy to buy Ikkuma to strengthen natural gas portfolio

Canadian oil and gas exploration and production firm Pieridae Energy has signed an arrangement agreement to acquire all of the issued and outstanding shares of Ikkuma Resources.

To be affected by a plan of arrangement, the transaction will give Pieridae ownership of an area of gas-prone reserve and resource production assets situated primarily in the central Alberta Foothills area.

Under the terms of the arrangement agreement, Ikkuma will also transfer certain interests in Cardium light oil-focused Alberta Foothills properties to a newly formed entity, known as ExploreCo.

The transfer of certain interests to ExploreCo is subject to the receipt of certain regulatory approvals from the Alberta Energy Regulator (the AER).

The agreement will see each Ikkuma shareholder receive 0.1926 of a Pieridae common share and 0.1 of an ExploreCo share for each common share held by them.

The shares distribution is conditional on approval by the AER of the transfer of the crude oil properties.

Following the closure of the agreement, Ikkuma shareholders will hold 100% of ExploreCo.

The acquisition represents a key step towards making the final investment decision for the Goldboro liquefied natural gas (LNG) project this year.

Located in Guysborough County, Nova Scotia, Canada, the Goldboro project comprises an LNG processing facility, storage tanks and marine works.

The project has a capital expenditure of up to $10bn will produce around ten million metric tonnes of LNG a year.

Pieridae Energy CEO Alfred Sorensen said: “The purchase of Ikkuma begins the final steps to reaching the final investment decision, which, along with our other partners, will ensure that Canada has the opportunity to export its resources to international markets.”

The transaction is consistent with Pieridae’s strategic plans for the acquisition of natural gas reserves and resources in its integrated business model.

It will allow the company to deliver LNG to European and other markets at competitive prices.

The acquisition of Ikkuma will also provide Pieridae an opportunity to further consolidate natural gas assets in Alberta and British Columbia that are complementary to its feedstock needs.