CALGARY, Alberta, March 17 Imperial Oil Ltd
, Canada's No.3 oil and gas company, said on Monday
Whitecap Resources Inc has agreed to buy some of its
oil and gas properties in Western Canada for about C$855 million
($771.14 million) as it focuses on its oil sands and shale
properties in the region.
Imperial Oil, 69.6 percent owned by Exxon Mobil Corp
, said the properties in British Columbia and Alberta had
produced about 15,000 barrel of oil equivalent per day in 2013.
Imperial is in the midst of expanding its Kearl and Cold
Lake oil sands projects and seeking regulatory approval for the
C$7 billion Aspen oil sands project. The company also operates
in several of Western Canada's shale-petroleum regions and often
sells properties it no longer considers central to its
"It's our long standing practice to continually review
assets for their contribution to meeting strategic, operational
and financial objectives," said Leanne Dohy, a spokeswoman for
the Calgary-based company.
For Whitecap, the acquisition is one of several
announcements that will see the mid-sized Western Canadian oil
and gas producer double its production and increase its dividend
by 10 percent.
Along with the purchase of Imperial's properties, Whitecap
agreed to sell a natural-gas processing plant in Alberta to
Keyera Corp for C$113 million and buy an undisclosed
private oil and gas producer with assets in north central
Alberta for C$107 million.
To finance its acquisition, Whitecap arranged to sell 44.6
million subscription receipts priced at C$11.20 each to a group
of underwriters led by National Bank Financial and TD Securities
Inc for gross proceeds of about C$500 million.
The company will also increase its monthly dividend by about
10 percent to 6.25 Canadian cents per share from 5.67 Canadian
cents because of the additional cash flow provided by the
Whitecap said it expects its deals to boost its expected
2014 production by 13 percent to 31,600 barrels of oil
equivalent per day (boepd), three-quarters of which will be
high-value oil and natural-gas liquids.
It also raised its cash flow per share forecast for the year
by 7 percent to C$2.13.
Whitecap shares were up 42 Canadian cents to C$11.95 by late
morning on the Toronto Stock Exchange while Imperial rose 4
Canadian cents to C$51.11.
The transactions is expected to close in May.