Altima Resources Ltd. (TSXV: ARH) (OTC Pink: ARSLF) (the "Company" or "Altima") is pleased to announce the closing of a Purchase and Sale Agreement dated August 30, 2024 ("the PSA") with Uriel Gas Holdings Corp. ("Uriel") with an effective date of August 1, 2024 pursuant to which Altima has acquired the Assets (as herein after defined) for a price of $450,000 (the "Purchase Price") payable in cash (paid). This amount is inclusive of $312,015 paid to Uriel's creditors who were owed money in relation to the Assets.
This Acquisition solidifies Altima's expansion into the conventional light oil fairways within Alberta, further enhancing the Company's target to position itself as a key player in the energy sector.
The Acquisition grants Altima substantial control over both existing and prospective production, alongside future growth potential.
Asset Highlights:
Central Alberta (W4) - light oil
Northwest Alberta (W5) - sweet natural gas
- Extensive Acreage: The Assets cover approximately 10,560.5 gross acres, including 5,920.5 acres, 800 acres and 3,840 acres in three separate and high oil access areas of Alberta.
- As part of the Acquisition, Altima has also secured key infrastructure with an Oil Battery in Central Alberta as well as an interest in a natural gas plant in Northwest Alberta. This infrastructure will enable Altima to optimize processing and transportation, control operational costs, and ensure efficient market access. The Acquisition strengthens Altima's position in Alberta's energy sector, providing it with the ability to streamline production and increase profitability.
- Proven Reserves: The Asset boasts 127 MBOE of Total Proved Developed Producing Reserves and 531 MBOE of Total Proved Reserves; sourced from a Report prepared by a GLJ Ltd., an independent qualified reserve evaluator, effective June 30, 2023 and prepared in accordance with NI 51-101 Section 5.2.
- NPV: $1,360,000 (PDP Before Tax 10% DCF PV) and $9,938,000 (TP Before Tax 10% DCF PV); sourced from a Report prepared by GLJ Ltd., an independent qualified reserve evaluator, effective June 30, 2023, and prepared with the requirements for the determination of future net revenue specified in Form 51-101F1.
- Acquisition Metric: $18,000 per producing bbl.
Strategic Upside: This Acquisition is expected to significantly increase Altima's operational capabilities and resource base. With existing infrastructure in place and assets positioned at relatively shallow depths (1200-m) and light-medium oil (34°API), Altima can expedite development with a reasonable capital cost structure, leading to lower operational costs, and increased profitability as compared to other more complex operating areas of Alberta.
Joe DeVries, CEO of Altima commented: "This Acquisition is a positive step for Altima. The Assets we are acquiring provide substantial reserves and production potential. We are confident that our operational expertise will unlock further value from these high-quality Assets, creating significant growth opportunities for our shareholders."
Transaction Overview: Under the terms of the PSA, Altima will acquire a non-operating 95% interest in the Richdale Assets (as defined in the PSA), along with a non-operating 20% interest in remaining asset portfolio, including notable mineral rights in Crossfield East and the Greater Grande Prairie area (collectively, the "Assets"). At closing of the Acquisition (the "Closing"), the parties will enter into a Contract Operating Agreement, under which Altima will be appointed as the Contract Operator (as defined in the Contract Operating Agreement) of the Richdale Assets. The Acquisition grants Altima substantial control over both existing and prospective production of the Assets, alongside future growth potential.
In connection with the Acquisition, Altima will also have a right of first refusal for a period of six months following closing to purchase Uriel's remaining interest in the Richdale Assets; and if left unexercised after the initial six months period will provide Altima with a right of first refusal with respect to any proposed sale of by Uriel of its residual Richdale interest.
Jamie Carlson, a Professional Engineer, is the Qualified Person responsible for preparing and reviewing the data contained in this press release.
