Renegade Petroleum (RPL-V)
www.renegadepetroleum.com
89.6 million
$75 million in cash plus the escrowed proceeds from the private placement immediately prior to closing.
Key people:
Michael C Erickson, President & CEO
Michael C. Erickson serves as the Co-Founder, Director, President and Chief Executive Officer of Renegade Petroleum Ltd. Mr. Erickson has over 16 years of industry experience, most recently as the Founder, Director, President and Chief Executive Officer of Renegade Oil & Gas, acquired by Glamis Resources Ltd., now Legacy Oil + Gas Inc., in September 2009. Prior to the Founding of Renegade Oil & Gas in 2004, Mr. Erickson served in various increasing capacities at a junior public TSX listed oil and gas company.
Mr. Erickson holds a Bachelor of Commerce Degree in Finance and a Bachelor of Arts in Economics from the University of Calgary.
J. Alexander Wylie, Vice-President, Finance and CFO
Alex Wylie currently serves as the Co-Founder, Vice-President, Finance and Chief Financial Officer of Renegade Petroleum Ltd. Mr. Wylie was also the Executive Vice-President, Finance of Renegade Oil & Gas when it was purchased by Glamis Resources Ltd., now Legacy Oil + Gas Inc. in September 2009. With over 20 years of experience in both the oil and gas industry and capital markets, Mr. Wylie was previously Managing Director of Energy Investment Banking at a major North American independent Investment Bank. Prior to that Mr. Wylie served in increasing roles in the investment banking industry. Mr. Wylie commenced his career at KPMG.
Mr. Wylie is a Chartered Accountant and also holds a B.A. in Economics from University of Western Ontario.
Company presentation
renegadepetroleum.com
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Renegade to acquire assets producing 3,600 boe/d
Oct 31, 2012 - News Release
Renegade Petroleum Ltd. has arranged a series of transformational transactions, which transition Renegade into the highest domestic light-oil-weighted income-plus-growth dividend-paying corporation in the Canadian public markets and pursuant to which Canadian Phoenix Resources Corp. shareholders will acquire common shares of Renegade. The board of directors of Renegade has conditionally approved an initial monthly dividend of 1.92 cents per share (23 cents annualized) and a forecasted 93.9-per-cent all-in payout ratio. Based on the bought-deal offering and the private placement price on Oct. 29, 2012, of $2.35, this would provide an annualized yield of 9.8 per cent. The transactions include the following:
- Asset acquisition of 3,600 barrels of oil equivalent per day of 94 per cent light oil, low decline (18 per cent) and high-capital-efficiency assets within Renegade's core area of southeast Saskatchewan;
- $70.7-million bought-deal financing of subscription receipts of Renegade;
- Additional approximately $114.3-million private placement of subscription receipts of Canadian Phoenix Acquisition Corp., a newly created wholly owned subsidiary of Canadian Phoenix Resources;
- Acquisition by Renegade of CPAC, which is expected to hold approximately $75-million in cash plus the escrowed proceeds from the private placement immediately prior to closing.
In addition, Renegade is pleased to provide a third quarter operational update and revised 2012 guidance reflecting fourth quarter 2012 drilling and capital expenditure changes consistent with the transition into an income-plus-growth model.
Canadian Phoenix is pleased to announce the arrangement. Pursuant to the arrangement, through a series of transactions, Canadian Phoenix shareholders will receive Renegade common shares and will also continue to hold shares of Canadian Phoenix.
The asset acquisition
Renegade has entered into an asset purchase agreement with a Canadian senior producer to acquire certain light oil and gas assets within its existing southeast Saskatchewan core area for cash consideration of approximately $405-million (net of approximately $15-million in closing adjustments).
Key attributes of the asset acquisition:
- A total of 3,600 barrels of oil equivalent per day of light oil production (94 per cent light oil) with a stable, long-life, low-decline (18 per cent) production profile;
- Strong capital efficiencies and top-tier operating netbacks ($45.66 per boe) providing significant free cash flow and ideally positioning Renegade for a sustainable income-plus-growth dividend model;
- Significant overlap with Renegade's existing southeast Saskatchewan assets providing Renegade with operational synergies;
- Key members of Renegade's operational team with prior experience running the acquired assets;
- High working interest (86 per cent) and high operatorship (83 per cent);
- Conservatively booked reserves with proved developed producing reserves representing 81 per cent of total proved reserves and 57 per cent of total proved plus probable reserves;
- Up to 219 square kilometres of 3-D seismic and 599 kilometres of 2-D seismic;
- Existing infrastructure, including process facilities, water disposal and storage capacity within Renegade's core southeast Saskatchewan areas, providing operational synergies between Renegade's current asset base and the acquired asset base;
- Significant low-risk development inventory of an expected 240 (gross) low-risk development locations based on current mapping, of which only 27 locations are booked.
The asset acquisition has the characteristics summarized in the attached asset acquisition characteristics table.
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