Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Hillcrest Petroleum seals deal to pursue Western Canada opportunities

Hillcrest has now inked binding agreements with a private company, it told investors
Hillcrest Petroleum seals deal to pursue Western Canada opportunities
Hillcrest has already compiled a register of potential acquisition targets in Western Canada, it said.

Hillcrest Petroleum Ltd (CVE:HRH) has now inked binding agreements with a private company to form a strategic alliance to pursue oil and gas acquisitions in Western Canada.

As reported last week, under the new arrangement, Hillcrest will introduce the partner to pre-screened acquisition opportunities and the partner would fund the acquisition and development.

Hillcrest has already compiled a register of potential acquisition targets in Western Canada, based on criteria including positive operating cash flow from current production operations, and the potential to increase the market value of the assets by more than 3 times’.

"The execution of the binding agreements forming this strategic alliance with a funding partner is a substantial development for Hillcrest and one that has the ability to fast track our acquisition and development plans," said Don Currie, Hillcrest chief executive on Tuesday.

"The relationship between the parties will see their capital back our Western Canadian acquisition opportunities, with both parties benefiting as acquisitions are completed and further field development is undertaken to unlock the value in the assets.

"Assuming the partner is successful in its financing activities over the coming weeks, Hillcrest would expect to accrue significant short term value increases, at no cost to Hillcrest, through our carried interest interests in quality oil and gas assets that we have identified and commenced discussions on over the last several months.

"Further value to Hillcrest could be expected as value is delivered from acquired assets through field development activities managed by Hillcrest and from management fees and various bonus structures under the agreements related to the strategic alliance.

"Another significant benefit, is that Hillcrest will no longer have to consider equity capital raises and/or debt to fund acquisition and development opportunities for growth.

"We are excited to be aligned with a financial group who recognize and are prepared to invest based on our management team's extensive experience and track record delivering value from upstream oil and gas projects and who share our belief that this is an excellent time to be acquiring assets in the Western Canadian Sedimentary Basin."

Among the parts of the deal, for any assets which the partner elects to fund, Hillcrest will manage and operate those assets under the terms of joint venture agreements between Hillcrest and the Partner.

Hillcrest will also receive a 25% carried interest in any assets acquired.

Hillcrest will receive a management fee and be entitled to recover its out-of-pocket costs for managing the assets.

In Toronto, Hillcrest shares stand at C$0.060.

View full HRH profile View Profile

Hillcrest Petroleum Ltd Timeline

Newswire
February 06 2018

Related Articles

picture of Canada
September 28 2017
Hillcrest Petroleum Ltd eyes big footprint in Saskatchewan and Alberta
oil and gas operations
May 23 2018
An acreage award in the UK 30th Offshore Licensing Round expands the group's flagship Liberator field
oil and gas operations
March 23 2018
“Like most E&P companies, Range is trading at a material discount; and has not seen a significant uplift in price following the rally in crude prices”

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use