Corporate M&A

Canadian Overseas Acquires Powder River Basin-Focused Atomic Oil & Gas

By Isha Makkar
December 17, 2020
a minute read
Oil Derrick

Calgary-based Canadian Overseas Petroleum Ltd. (COPL) has entered into an agreement to acquire 100% of privately-held U.S. E&P company Atomic Oil & Gas LLC, in a corporate transaction valued at US$54 million, including the assumption of US$26 million of debt.

Under the terms of the agreement, COPL will acquire a 100% stake in Atomic in exchange for a cash consideration of US$24 million, an additional US$4 million payable by way of issuance of COPL shares, and the assumption of Atomic’s bank debt.

Atomic’s assets include approximately 52,250 gross acres of contiguous leasehold in the Powder River basin in Wyoming, comprised of two oil production units, namely Barron Flats Shannon Miscible Flood Unit (57.7% WI) and the Cole Creek Unit (66.7% WI). The assets also include a unitized exploration area, the Barron Flats Federal Unit (deep). The oil-producing assets are at the beginning of their 40+ year life, with a current average daily production of 14,000 barrels per day (bbl/d).

“This is a game-changing acquisition which will materially reposition COPL as a production company with assets that have a long-term lifecycle and rapid production opportunity,” said Arthur Millholland, President & CEO of COPL.

“With this acquisition, in addition to the substantial upside potential already present in our Nigerian offshore project, the Company is now strategically well placed to deliver enhanced value and returns to shareholders,” he added.

Dual-listed on the Canadian Securities Exchange (CSE) and the AIM Market of the London Stock Exchange (LSE), COPL is focused on exploration and development opportunities offshore West Africa, and is currently engaged in projects in Nigeria (in partnership with Shoreline Energy International Ltd.) and Liberia.

The transaction is expected to close on January 31st, 2021, with an effective date of December 1st, 2020.

Eight Capital is serving as corporate advisor to COPL on the deal.

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