- Tourmaline Oil Corp (TSX:TOU) is purchasing two companies that operate in Montney, British Columbia
- Chinook Energy and Polar Star Canadian Oil and Gas have been acquired by the company for a sum of C$33.4 million
- These acquisitions are part of Tournmaline’s five-year plan to develop its standing at Montney and its operations at the Gundy facility
- Tourmaline Oil Corp (TOU) was down 4.48 per cent, with shares currently trading for C$11.93
Oil and gas producer, Tourmaline Oil Corp. (TSX:TOU), has acquired two company’s operating in Canada’s oil-rich Montney region.
As part of a Montney consolidation effort, Chinook Energy and Polar Star Canadian Oil and Gas have been purchased by Tourmaline for a sum of $33.4 million.
Through these acquisitions, Tourmaline has added 160,000 acres of Montney land to its portfolio. Chinook and Polar Star currently produce approximately 6,000 equivalent barrels of oil per day.
Chinook Energy see’s the acquisition as largely positive, given its stock has been steadily declining since 2015. The company cited weakening commodity prices and an increasing difficulty in the Canadian exploration industry as reasons for its poor performance.
During a 2019 a strategic review, Chinook decided to explore its other options, including potentially selling off its assets.
Upon closing the deal, all of Chinook’s shares will be delisted from the TSX.
Today’s announcement is part of an on-going acquisition strategy Tourmaline is implementing to strengthen its presence across the Montney oil fields.
Tourmaline plans to develop both Chinook Energy and Polar Star Canadian Oil and Gas as part of a 5 year plan.
Tourmaline also plans to further develop its Gundy property at Montney. This includes building a deep-cut facility on-site. The company claims this development could double production at Gundy.
Tourmaline stated that further development of Chinook and Polar Star is unlikely to happen in the next two years.
During that time, Tourmaline will instead assemble a region development plan, which will outline Chinook’s and Polar Star’s future operations.
Tourmaline Oil Corp (TOU) was down 4.48 per cent, with shares currently trading for C$11.93.