CALGARY, July 23 /CNW-PRN/ - Encal Energy Ltd. announced today it has
signed a definitive agreement for the acquisition of a significant package of
producing properties, undeveloped land, processing and gathering facilities.
The properties are located in the Medicine River/Sylvan Lake area of west
central Alberta and are being purchased from a major producer.
The total transaction, which is effective August 1, 2000, is valued at
approximately $110 million and will be funded by the subsequent sale of non
core assets and approximately $90 million of new debt. Total debt at the end
of 2000 is forecast to be $360-370 million with year 2000 cash flow estimated
to be $250-260 million. The cost of this acquisition, inclusive of
exploitation activities planned for the balance of 2000, is expected to be
below $7.00 per barrel of oil equivalent per day (6:1) and $8.00 per barrel of
oil equivalent per day (10:1) on established reserves with production addition
costs in the $21,500 barrel of oil equivalent per day (6:1) and $26,000
barrel of oil equivalent per day (10:1) range.
``This acquisition is consistent with Encal's strategy of striving for
dominance in key growth areas and a disciplined financial approach relative to
acquisition investments. This group of properties is extremely complementary
to Encal's Markerville/Sylvan Lake core area with respect to both operations
and facilities,'' said David D. Johnson, President and C.E.O. of Encal.
As a result of this investment, Encal has increased capital expenditures
for 2000 from $225 million to $315 million.
Encal Energy Ltd. is a Calgary-based public oil and gas company with core
operations in northeastern British Columbia and west central Alberta. The
company focuses on growth through drilling primarily directed toward natural
gas targets. The company is listed on the Toronto Stock Exchange (symbol ENL)
and the New York Stock Exchange (symbol ECA).
Certain information contained herein may constitute forward-looking
statements under applicable securities laws. Such statements are subject to
known or unknown risks and uncertainties that may cause actual results to
differ materially from those anticipated or implied in the forward- looking
SOURCE Encal Energy Ltd.
/CONTACT: David D. Johnson, President and C.E.O., Steven A. Allaire, Vice
President, Finance and CFO, Michael R. Culbert, Vice President Marketing and
Business Development, (403) 750-3300/
CO: Encal Energy Ltd.
-0- Jul/23/2000 18:13 GMT
EOS (PRN) Jul/23/2000 14:13 85
-0- (PRN) Jul/23/2000 18:28 GMT
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