Pieridae Energy has closed its acquisition of all of Shell Canada Energy's midstream and upstream assets in the southern Alberta Foothills for $190 million.
Further to the $10 million deposit paid at signing of the purchase and sale agreement, on closing, Pieridae paid to Shell $165 million of the purchase price of the acquisition in cash.
CEO Alfred Sorensen says: 'We are very pleased to close this transformational acquisition as it secures the majority of the natural gas needed, once developed, to supply the first train at our Goldboro LNG facility for at least 20 years.
'We will now complete our negotiations with Kellogg Brown and Root for a fixed price contract to construct the Goldboro LNG facility so that we can then proceed to complete the project financing and final equity raise and make a final investment decision.'
With the acquisition, Pieridae now has an extensive drilling inventory encompassing multiple dry gas and liquids-rich gas reservoirs within the Foothills area. Together with existing Foothills drilling and development experience within the company, Pieridae is well positioned to leverage the $1.5 billion of the government-backed guarantees for the construction of the Goldboro LNG facility, which the Germany government has also approved in principle.
'There are additional opportunities to develop our liquids-rich areas, process the sour gas, strip out the liquids, store the dry gas and then further develop our dry gas resources down the road,' Sorensen adds.