Mineral Rights & Royalties

PrairieSky Royalty Acquires Royalty Interests in Alberta

By Sakshi Jain
July 19, 2021
a minute read
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TSX-listed PrairieSky Royalty Ltd. has entered into an agreement with Calgary-based Spur Petroleum Ltd. to acquire 5% gross overriding royalty (GORR) interests on production from assets located in the core Marten Hills Clearwater area of Alberta, for a total cash consideration of C$155 million. As a result of the acquisition, PrairieSky Royalty’s position in the Clearwater play will increase up to approximately 1.1 million gross acres in the Marten Hills, Godin, Nipisi, and South Marten Hills areas.

The assets acquired consist of 5% GORR interests on production from approximately 76,000 gross acres of lands in the core Marten Hills Clearwater area of Alberta. The current average daily royalty production attributable to the acquired interests is approximately 500 barrels of oil equivalent per day (boe/d), of which 96% is gas. The average daily royalty production for 2024 is estimated to be approximately 1,000 boe/d.

“The acquired royalty at Marten Hills represents a meaningful addition to PrairieSky’s already dominant Clearwater acreage position, with a near and medium-term growth trajectory and a best-in-class economic return profile,” said Andrew Phillips, President & CEO of PrairieSky Royalty. “The acquisition is consistent with PrairieSky’s long-term strategy of acquiring assets on the best part of the cost curve and that are complementary to PrairieSky’s existing portfolio,” he added.

Calgary-based PrairieSky Royalty currently has one of the largest independently-owned portfolios of fee simple mineral title and oil & gas royalty interests located across oil & gas producing basins in Alberta, British Columbia, Saskatchewan, and Manitoba.

Privately-held Spur Petroleum is engaged in the exploration, development, and production of oil and natural gas assets in western Canada.

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