Welcome!

News Feed Item

Freehold Royalties Ltd. Closes Acquisition of Royalty Production and Mineral Title Lands

CALGARY, ALBERTA -- (Marketwired) -- 05/05/14 -- Freehold Royalties Ltd. (Freehold) (TSX:FRU) announces that it has closed the previously announced acquisition involving royalty interests in southeast Saskatchewan and Manitoba (Vendor assets). Total consideration associated with the transaction was $111 million (before closing adjustments) with Freehold funding the deal through its existing bank credit line.

In addition, as part of the transaction, Canpar Holdings Ltd., a wholly-owned subsidiary of CN Pension Trust Funds, purchased certain undeveloped mineral title lands (Vendor assets) for $30 million (before closing adjustments).

The effective date of the acquisition is January 1, 2014. With the closing of the acquisition, Freehold has significantly strengthened its operating base and future opportunities while maintaining financial strength and sustainability of its dividend.

Acquisition Highlights:

--  2013 average production of 470 barrels of oil equivalent (boe) per day
    (99% oil weighted), from over 400 producing wells. Revenue is derived
    from a combination of Lessor Royalties and Non-Convertible Overriding
    Royalties, offering Freehold enhanced netbacks. 
--  2013 net operating income of $15.0 million. 
--  Increased land exposure adding 71,700 acres of Mineral Title Lands. 
--  Proved plus probable reserves of approximately 1.5 million boe, based on
    an independent engineering report prepared by Trimble Engineering
    Associates Ltd. as of December 31, 2013. 
--  37 gross new wells drilled within the acquired acreage through 2013. 
--  The acquisition also provides Freehold exposure to: 
    --  A stable oil weighted revenue stream. 
    --  The ability to grow royalty volumes through future year drilling
        programs. 
    --  Increased percentage of mineral title ownership relative to
        Freehold's existing acreage.
--  Freehold estimates 2014 year-end net debt of approximately $140-$145
    million (which leaves $65-$70 million in available capacity on our
    existing credit line), while implying approximately 1.0 times debt to
    funds flow (based on guidance provided in our fourth quarter news
    release). 
--  We have increased our production guidance for 2014 by 6% to 9,100 boe
    per day; all other operating assumptions (provided in our fourth quarter
    news release) remain unchanged. As we have in the past, we expect to
    update shareholders on 2014 guidance for other key operating assumptions
    when we release our first quarter results on May 14, 2014.

Freehold is a Calgary based, dividend paying, oil-weighted oil and gas company focused on providing a sustainable monthly dividend to its shareholders. We effectively manage our assets to consistently deliver attractive returns over the long-term. For further information about Freehold please visit our website at www.freeholdroyalties.com

Cautionary Statement Regarding Forward-Looking Information - This news release offers our assessment of Freehold's future plans and operations as at May 2, 2014 and contains forward-looking information including, Freehold's expectations for reserves, production, year-end debt and future prospects on the acquired lands. This forward-looking information is provided to allow readers to better understand our business and prospects and may not be suitable for other purposes. By its nature, forward-looking information is subject to numerous risks and uncertainties, some of which are beyond our control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, taxation, royalties, regulation, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility, and our ability to access sufficient capital from internal and external sources. Risks are described in more detail in Freehold's annual information form for the year ended December 31, 2013 which is available under Freehold's profile on SEDAR at www.sedar.com.

With respect to forward looking information contained in this news release, we have made assumptions regarding, among other things, future oil and natural gas prices; future capital expenditure levels; future production levels; future exchange rates; the costs of developing and producing our assets; our ability and the ability of our lessees to obtain equipment in a timely manner to carry out development activities; our expectation for industry drilling levels; and our ability to obtain financing on acceptable terms.

You are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking information. We can give no assurance that any of the events anticipated will transpire or occur, or if any of them do, what benefits we will derive from them. The forward-looking information contained herein is expressly qualified by this cautionary statement. Except as required by law, Freehold does not assume any obligation to publicly update or revise any forward-looking information to reflect new events or circumstances.

Conversion of Natural Gas To Barrels of Oil Equivalent (BOE)

To provide a single unit of production for analytical purposes, natural gas production and reserves volumes are converted mathematically to equivalent barrels of oil (boe). We use the industry-accepted standard conversion of six thousand cubic feet of natural gas to one barrel of oil (6 Mcf = 1 bbl). The 6:1 boe ratio is based on an energy equivalency conversion method primarily applicable at the burner tip. It does not represent a value equivalency at the wellhead and is not based on either energy content or current prices. While the boe ratio is useful for comparative measures and observing trends, it does not accurately reflect individual product values and might be misleading, particularly if used in isolation. As well, given that the value ratio, based on the current price of crude oil to natural gas, is significantly different from the 6:1 energy equivalency ratio, using a 6:1 conversion ratio may be misleading as an indication of value.

Contacts:
Freehold Royalties Ltd.
Matt Donohue
Manager, Investor Relations
403.221.0833 or 1.888.257.1873
403.221.0888 (FAX)
[email protected]
www.freeholdroyalties.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Historically, some banking activities such as trading have been relying heavily on analytics and cutting edge algorithmic tools. The coming of age of powerful data analytics solutions combined with the development of intelligent algorithms have created new opportunities for financial institutions. In his session at 20th Cloud Expo, Sebastien Meunier, Head of Digital for North America at Chappuis Halder & Co., discussed how these tools can be leveraged to develop a lasting competitive advantage ...
In his session at @ThingsExpo, Arvind Radhakrishnen discussed how IoT offers new business models in banking and financial services organizations with the capability to revolutionize products, payments, channels, business processes and asset management built on strong architectural foundation. The following topics were covered: How IoT stands to impact various business parameters including customer experience, cost and risk management within BFS organizations.
In his session at 20th Cloud Expo, Scott Davis, CTO of Embotics, discussed how automation can provide the dynamic management required to cost-effectively deliver microservices and container solutions at scale. He also discussed how flexible automation is the key to effectively bridging and seamlessly coordinating both IT and developer needs for component orchestration across disparate clouds – an increasingly important requirement at today’s multi-cloud enterprise.
Here are the Top 20 Twitter Influencers of the month as determined by the Kcore algorithm, in a range of current topics of interest from #IoT to #DeepLearning. To run a real-time search of a given term in our website and see the current top influencers, click on the topic name. Among the top 20 IoT influencers, ThingsEXPO ranked #14 and CloudEXPO ranked #17.
Given the popularity of the containers, further investment in the telco/cable industry is needed to transition existing VM-based solutions to containerized cloud native deployments. The networking architecture of the solution isolates the network traffic into different network planes (e.g., management, control, and media). This naturally makes support for multiple interfaces in container orchestration engines an indispensable requirement.
While the focus and objectives of IoT initiatives are many and diverse, they all share a few common attributes, and one of those is the network. Commonly, that network includes the Internet, over which there isn't any real control for performance and availability. Or is there? The current state of the art for Big Data analytics, as applied to network telemetry, offers new opportunities for improving and assuring operational integrity. In his session at @ThingsExpo, Jim Frey, Vice President of S...
In their session at @DevOpsSummit at 21st Cloud Expo, Michael Berman, VP Engineering at TidalScale, and Ivo Jimenez, Engineer at TidalScale, will describe how automating tests in TidalScale is easy thanks to WaveRunner. They will show how they use WaveRunner, Jenkins, and Docker to have agile delivery of TidalScale. Michael Berman is VP Engineering at TidalScale. TidalScale is developing a scale up compute and resource architecture for customers to perform big data exploration and real time anal...
Your homes and cars can be automated and self-serviced. Why can't your storage? From simply asking questions to analyze and troubleshoot your infrastructure, to provisioning storage with snapshots, recovery and replication, your wildest sci-fi dream has come true. In his session at @DevOpsSummit at 20th Cloud Expo, Dan Florea, Director of Product Management at Tintri, provided a ChatOps demo where you can talk to your storage and manage it from anywhere, through Slack and similar services with...
Containers are rapidly finding their way into enterprise data centers, but change is difficult. How do enterprises transform their architecture with technologies like containers without losing the reliable components of their current solutions? In his session at @DevOpsSummit at 21st Cloud Expo, Tony Campbell, Director, Educational Services at CoreOS, will explore the challenges organizations are facing today as they move to containers and go over how Kubernetes applications can deploy with lega...
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
Learn how to solve the problem of keeping files in sync between multiple Docker containers. In his session at 16th Cloud Expo, Aaron Brongersma, Senior Infrastructure Engineer at Modulus, discussed using rsync, GlusterFS, EBS and Bit Torrent Sync. He broke down the tools that are needed to help create a seamless user experience. In the end, can we have an environment where we can easily move Docker containers, servers, and volumes without impacting our applications? He shared his results so yo...
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Enterprise architects are increasingly adopting multi-cloud strategies as they seek to utilize existing data center assets, leverage the advantages of cloud computing and avoid cloud vendor lock-in. This requires a globally aware traffic management strategy that can monitor infrastructure health across data centers and end-user experience globally, while responding to control changes and system specification at the speed of today’s DevOps teams. In his session at 20th Cloud Expo, Josh Gray, Chie...