Baytex Energy Divests Western Canada Crude Assets for $113MM

Baytex Energy is divesting some of its crude oil assets in Western Canada, the company announced on Nov. 27.

Calgary-based Baytex Energy Corp. agreed to sell a portion of its Viking assets, located at Forgan and Plato in southwestern Saskatchewan, for nearly US$113 million (CA$153.8 million).

Production from the assets is approximately 4,000 boe/d (100% light and medium crude oil).

The transaction is expected to close before the end of the year. The buyer was not disclosed.

Proceeds from the sale are expected to be applied toward repaying Baytex’s outstanding bank debt, the company said.

Baytex had total debt of US$1.98 billion (CA$2.7 billion) and a debt-to-EBITDA ratio of 1.1x as of Sept. 30, the company reported in third-quarter earnings.

Baytex has a $1.1 billion revolving credit facility with a maturation date of April 1, 2026. The company repaid a $150 million term loan during the third quarter.

Scale in South Texas

The third quarter was also Baytex’s first full quarter of combined operations after closing its acquisition of Eagle Ford Shale E&P Ranger Oil Corp.

The $2.2 billion acquisition added 162,000 net acres and 741 undeveloped drilling locations in the crude oil window of the Eagle Ford—which complemented Baytex’s existing non-operated position in the Karnes Trough.

Third-quarter production in the Eagle Ford averaged 87,311 boe/d (85% oil and NGL).

Baytex’s companywide production averaged 150,600 boe/d during the third quarter, up 81% from an average of 83,194 boe/d during the same quarter a year ago.

RELATED: Baytex Closes $2.2 Billion Acquisition of Eagle Ford’s Ranger Oil