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Properties   /   Ascensun Oil and Gas Ltd.



Ascensun Oil and Gas Ltd.

Property Divestiture
Bid Deadline: March 3, 2022
12:00 PM
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OVERVIEW

ASCENSUN HAS SOLD ITS INTERESTS IN THE LEDUC AREA OF ALBERTA.

Sayer Energy Advisors has been engaged to assist Ascensun Oil and Gas Ltd. (“Ascensun” or the “Company”) with the sale of its oil and natural gas interests located in the Grand Forks, Leduc and Southern Alberta Minor areas of Alberta (the “Properties”).
 
The Company’s low decline oil production is from the Grand Forks area, where Ascensun holds mainly 100% working interests in several oil pools producing from the Glauconitic Sandstone, Sawtooth, Lower Mannville and Sunburst formations.

 
Average daily production net to Ascensun from the Properties for November 2021 was approximately 185 barrels of oil and natural gas liquids per day and trace volumes of natural gas (185 boe/d).
 
Net operating income from the Properties for November 2021 was approximately $152,000 or $1.8 million on an annualized basis.
 
The Company’s preference would be to sell the Properties in one transaction with the exception of the Leduc property, which could be sold separately.

Overview Map Showing Location of the Divestiture Properties
Production Overview
 
Average daily production net to Ascensun from the Properties for November 2021 was approximately 185 barrels of oil and natural gas liquids per day and minor volumes of natural gas (185 boe/d) as outlined below.
 
Net operating income from the Properties for November 2021 was approximately $152,000 or $1.8 million on an annualized basis.

 

 
Gross Production Group Plot of Ascensun’s Oil and Natural Gas Wells

LMR Summary

As of January 1, 2022, Ascensun’s net deemed asset value for the Properties was ($2.2 million) (deemed assets of $7.6 million and deemed liabilities of $9.9 million), with an LMR ratio of 0.77.
 
The LMR for each of the Properties as of January 1, 2022 is summarized below.

 
Summary of LMR by Property


The stated LMR numbers do not include a $2.4 million security deposit with the Alberta Energy Regulator (“AER”).

Reserves Overview

Trimble Engineering Associates Ltd. (“Trimble”) prepared an independent reserves evaluation of the Properties as part of the Company’s year-end evaluation (the “Trimble Report”). The Trimble Report is effective December 31, 2020 using Trimble’s January 1, 2021 forecast pricing. 
 
Trimble estimates that, as of December 31, 2020, the Properties contained remaining proved plus probable reserves of 3.2 million barrels of oil and natural gas liquids and 1.2 Bcf of natural gas (3.4 million boe), with an estimated net present value of $27.5 million using forecast pricing at a 10% discount.






 

GRAND FORKS

Township 10-13, Range 11-15 W4

At Grand Forks, Ascensun holds mainly 100% working interests in several oil pools producing from the Glauconitic Sandstone, Sawtooth, Lower Mannville and Sunburst formations.

 
Average daily production net to the Company from Grand Forks in November 2021 was approximately 185 barrels of oil and natural gas liquids per day and two Mcf/d of natural gas (185 boe/d). 
 
Operating income net to Ascensun from Grand Forks in November 2021 was approximately $152,000, or $1.8 million on an annualized basis.


Grand Forks, Alberta
Gross Production Group Plot of Ascensun’s Oil and Natural Gas Wells



Grand Forks Geology
 
The Grand Forks property consists of several oil pools targeting the Glauconitic Sandstone, Sawtooth, Lower Mannville and Sunburst formations as shown on the following map.

 

Bow Island Glauconite E Pool – Glauconitic Sandstone Formation
 
The Glauconitic Sandstone Formation is found at a depth of approximately 900-950 metres as shown in the following well log.
 
The main mechanism for production from the E pool reservoir is water drive. Three wells have been converted to water injectors to maintain pressure. 
 
Churchill BI 100/04-29-010-13W4/0 – Glauconitic Sandstone Formation Type Log

Grand Forks FWW Pool – Lower Mannville WW
 
The Lower Mannville Formation is found at a depth of approximately 900-950 metres as shown in the following well log.
 
The Lower Mannville reservoir in the FWW pool produces through water drive.
 
Churchill 102 GrdFrks 102/15-04-011-13W4/0 – Lower Mannville Type Log

 
Grand Forks Sawtooth PPP Pool
 
The Sawtooth reservoir is found at a depth of approximately 900-950 metres as shown in the following well log.
 
Oakmont GrdFrks 100/08-22-011-14W4/0 – Sawtooth Type Log

Grand Forks Sunburst C2C Pool
 
The Sunburst Formation is found at a depth of approximately 870 metres as shown in the following well log.
 
Churchill 102 GrdFrks 102/03-18-011-13W4/0 – Sunburst Type Log

Grand Forks Seismic
 
The Company has ownership in trade 3D seismic data over the majority of its lands at Grand Forks as illustrated on the following plat.  The Company’s interpretations of the seismic are available for viewing on a workstation by parties which have executed a confidentiality agreement.

 

Grand Forks Facilities
 
Ascensun holds an interest in the following facilities at Grand Forks.  
 
Further details on the Company’s facilities and equipment are available to parties that sign a confidentiality agreement.

 

The Grand Forks E, C2C and FWW pools produce to Ascensun’s multi-well oil battery at 10-07-11-13W4.
 
Ascensun’s oil production from the Grand Forks PPP pool is pipeline connected to its battery at 10-22-11-14W4.
 
The Company’s oil production from the Grand Forks QQQ is connected to its battery at 00/12-14-011-14W4.

 
The Company has a 100% working interest in the Bow Island Upper Mannville “A” Unit No. 1 which has a gathering system connected to its multi-well battery at 09-10-10-13W4.

Grand Forks Marketing
 
Ascensun has a monthly crude oil purchase agreement in place with Macquarie Oil Services Canada Ltd. terminable with 30 days’ notice. 

Ascensun’s multi-well batteries are located at 09-10-10-13W4, 10-07-11-13W4, 12-14-11-14W4 and 10-22-11-14W4.  Oil is trucked to the Fincastle truck terminal where it is sold into the Bow River South Pipeline and the BR Plains Pipeline.

Grand Forks Reserves
 
Trimble Engineering Associates Ltd. (“Trimble”) prepared an independent reserves evaluation of the Properties as part of the Company’s year-end evaluation (the “Trimble Report”). The Trimble Report is effective December 31, 2020 using Trimble’s January 1, 2021 forecast pricing. 
 
Trimble estimates that, as of December 31, 2020, the Grand Forks property contained remaining proved plus probable reserves of 2.4 million barrels of oil, with an estimated net present value of $18.8 million using forecast pricing at a 10% discount.


 


Grand Forks LMR as of January 1, 2022
 
As of January 1, 2022, Ascensun’s net deemed asset value for Grand Forks was ($1.4 million) (deemed assets of $7.6 million and deemed liabilities of $9.0 million), with an LMR ratio of 0.84.

 

The stated LMR numbers do not include a $2.4 million security deposit with the AER.
 
Grand Forks Well List
 
Click here to download the entire well list in Excel.


 

SOUTHERN ALBERTA MINOR

Township 1-14, Range 4-23 W4

In addition to Ascensun’s interests in the Grand Forks and Leduc areas, the Company has various operated and non-operated working interests in several wells throughout Alberta including the Branch, Little Bow and Medicine Hat areas.
 
There is no production associated with the Southern Alberta Minor properties.

 

 
 

Southern Alberta Minor Facilities

At Southern Alberta Minor Ascensun holds an interest in the following facilities. 
 
Further details on the Company’s facilities and equipment are available to parties that sign a confidentiality agreement.


 

The 06-22 gas plant consists of a dehydrator, compressor and tank.

Southern Alberta Minor Reserves

The Southern Alberta Minor properties were not evaluated.
 
Southern Alberta Minor LMR as of January 1, 2022
 
As of January 1, 2022, Ascensun’s net deemed asset value for Southern Alberta Minor was ($804,922) (deemed assets of $0 and deemed liabilities of $804,922), with an LMR ratio of 0.00.

 

The stated LMR numbers do not include a $2.4 million security deposit with the AER.
 
Southern Alberta Minor Well List
 
Click here to download the entire well list in Excel.

 

PROCESS & TIMELINE

Sayer Energy Advisors is accepting offers relating to the process until 12:00 pm on Thursday March 3, 2022.


 
Sayer Energy Advisors does not conduct a "second-round" bidding process; the intention is to attempt to conclude
transaction(s) with the party(ies) submitting the most acceptable proposal(s) at the conclusion of the process.

Sayer Energy Advisors is accepting proposals from interested parties until
noon on Thursday March 3, 2022.

NOTE REGARDING A SAYER PROCESS
 
On each and every offering brochure generated by Sayer, you will note the sentence “Sayer Energy Advisors does not conduct a “second-round” bidding process; the intention is to attempt to conclude a sale of the Property with the party submitting the most acceptable proposal at the conclusion of the process.”  What this means is that Sayer will not go back to multiple parties at the same time after bids are received, asking them all for a second bid.  We determine which party submitted the most acceptable proposal and then we attempt to negotiate acceptable terms with that party in a “one-off” situation.

If the process involves a cash sale of a property or company and the party which submitted the most acceptable proposal has met our client’s threshold value, that offer will be accepted.  If this proposal does not meet our client’s threshold value, then we will advise that party that the offer is not quite what our client was expecting, and we will ask them to increase the offer.  If that offer is not acceptable to our client, we will then move down to the party which submitted the next most acceptable proposal and we will then work with that party to attempt to meet our client’s threshold value.

In the extremely rare circumstance where two or more parties submit virtually identical proposals, we will contact all  parties, we will advise them of this situation and we will ask them to submit a revised proposal.  Once these are received, we will work with the party which has submitted the most acceptable proposal.

CONFIDENTIALITY AGREEMENT

Parties wishing to receive access to the confidential information with detailed technical information relating to this opportunity should execute the Confidentiality Agreement and return one copy to Sayer Energy Advisors by courier, email (brye@sayeradvisors.com) or fax (403.266.4467).
 
Included in the confidential information is the following: summary land information, the Trimble Report, LMR information, most recent net operations summary, detailed facilities information and other relevant technical information.
 
Download Confidentiality Agreement
 
To receive further information on the Properties please contact Ben Rye, Tom Pavic or Sydney Birkett at 403.266.6133.

 
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