Athabasca Oil Corporation Announces Closing of Non-Core Light Oil Asset Sale, Reaffirms 2023 Guidance and Provides a Return of Capital Update

CALGARY, Alberta, Sept. 14, 2023 (GLOBE NEWSWIRE) -- Athabasca Oil Corporation (TSX: ATH) (“Athabasca” or the “Company”) is pleased to announce that it has closed its previously announced sale of non-core Light Oil assets at Placid, Saxon and Simonette to a private company (the “Transaction”).

Transaction Overview

Athabasca has sold its 70% operated working interest in Placid targeting the Montney, its 30% non‐operated working interest in Saxon and Simonette targeting the Duvernay and other associated non-core Placid Montney assets to a private company for $160 million in cash before closing adjustments. During the first half of 2023, these assets collectively averaged ~3,000 boe/d (~45% Liquids). The deal closed on September 14, 2023, with an effective date of March 1, 2023.

The Transaction was completed at attractive and accretive metrics, and crystallizes the value of the assets that have become non-core due to the smaller scale, lower liquids content and lower relative returns versus core assets within the Company’s portfolio.

The Company’s Light Oil division now consists exclusively of the Duvernay in the Greater Kaybob area with ~155,000 gross acres across Kaybob West, Kaybob North, Kaybob East and Two Creeks. The Company is planning Duvernay activity that is expected to offset production from the Transaction and support the Company’s multi-year free cash flow outlook. Athabasca is uniquely positioned in the liquids-rich oil window of the play with a de-risked inventory of ~500 gross wells.

Reaffirming 2023 Guidance

Athabasca expects its annual production to be within previous guidance of 34,500 – 36,000 boe/d. Strong performance of the Company’s assets year to date, including the recent ramp-up of the five new sustaining well pairs at Leismer, is anticipated to offset production associated with the Transaction in the Company’s original guidance.

Athabasca’s strong balance sheet affords it significant flexibility for future capital allocation opportunities. The Company is forecasting Liquidity of ~$415 million, inclusive of ~$325 million of cash, at the end of September. The Company anticipates releasing its 2023 third quarter results on November 1 after market close and its 2024 budget guidance in December.

Return of Capital Update

Athabasca is committed to executing on its 2023 return of capital commitment that will see a minimum of 75% of Excess Cash Flow (Adjusted Funds Flow less Sustaining Capital) in 2023 returned to shareholders through share buybacks. Since April, the Company has completed ~$80 million in share buybacks (~25 million shares at an average price of $3.19 per share).