Tamarack Valley Energy Ltd. recently unveiled plans for further strategic consolidation of its Clearwater position through the acquisition of Rolling Hills Energy Ltd. for CA$93 million.

“The acquisition of Rolling Hills completes the consolidation of our core operating area in the Southern Clearwater, which will allow us to fully optimize development and maximize returns from this area,” Brian Schmidt (Aakaikkitstaki), Tamarack’s president and CEO, commented in a company release on April 21.

Tamarack entered into a definitive agreement to acquire Rolling Hills, a privately held pure play Clearwater oil producer, which Tamarack said will fully consolidate its working interest and operatorship to 100% in the greater Jarvie play in the Southern Clearwater area.

The acquisition includes 70 (54 net) future development drilling locations across only 1/3 of the 34,560 net acres acquired with forecast production of about 2,100 boe/d.

Total consideration of CA$93 million consists of CA$46.5 million in cash and the issuance of about 9.3 million common shares of Tamarack at $5.0126 per share.

In conjunction with the Rolling Hills acquisition, Tamarack also entered into additional agreements to further consolidate its Clearwater position through the addition of undeveloped lands in the Peavine area plus announced a return of capital update that included a 20% base dividend increase and shareholder guidance with respect to delivering enhanced returns through tactical share buybacks and/or enhanced dividends.

The Rolling Hills acquisition coupled with Tamarack’s second strategic Peavine Metis Settlement agreement and additional land sales in the Peavine area will expand the company’s total Clearwater footprint to 593.2 net sections (379,650 net acres), according to Schmidt.

“Tamarack’s announcements today are the result of our disciplined focus on sustainable free funds flow growth and accretive acquisitions,” he added. “Through our strategic focus over the past two years, we have positioned the company for long-term sustainable free funds flow growth and shareholder returns.”

Peters & Co. Ltd. and RBC Capital Markets are financial advisers to Tamarack and Stikeman Elliott LLP providing legal counsel for the Rolling Hills acquisition. National Bank Financial Inc. is financial adviser and Burnet, Duckworth & Palmer LLP is acting as legal counsel to Rolling Hills.