Crescent Point Energy Corp. has clearly made a conscious decision to ramp up operations in 2012. Since January, the firm has struck just over $1.7-billion in takeovers, the latest of which was announced on Thursday.
Under the latest agreement, Crescent Point will buy private oil and gas player Cutpick Energy, whose assets are in the Viking light oil resource play near Provost, Alberta. In exchange for the $425-million it is doling out, Crescent Point will pick up production of 5,600 barrels of energy a day, weighted approximately 65 per cent to light oil.
Crescent Point says the new assets will "complement and consolidate" its existing position in the Alberta and Saskatchewan Viking light oil resource play.
Now that the deal is public, it means Crescent Point has announced a takeover in every month this year, except for April. Individually, they may not seem like much because the largest was $625-million, but combined they total $1.7-billion.
Here's a brief run down of what Crescent Point has acquired:
January: Bought Wild Stream for $611-million, adding production of approximately 5,400 barrels of energy per day. The deal solidified Crescent Point's dominance in the Shaunavon resource play in southwest Saskatchewan. Crescent Point also increased its Beaverhill Lake light oil land positions at a total cost of $38-million.
February: Bought assets in the Viewfield Bakken light oil resource play in southeast Saskatchewan from PetroBakken for $427-million in cash, adding 2,900 barrels of energy a day in production. Crescent Point also acquired Manitoba light oil assets with production of just 940 barrels of energy per day for $130-million.
March: Acquired the majority stake in Reliable Energy that it didn't already own for about $99-million. The deal added production of approximately 1,000 barrels of energy per day from the Bakken light oil play.
May: Announces Cutpick transaction worth $425-million.
All this activity has been a gift to investment banks because so many have benefitted from Crescent Point's deals. In each of the transactions, the firm has used different advisers, including BMO Nesbitt Burns, FirstEnergy, Peters & Co. Scotia Capital, National Bank Financial and Macquarie. (NBF and Macquarie advised on the most recent deal.) Crescent Point also completed a $604-million equity deal earlier in 2012, led by BMO, CIBC World Markets and Scotia Capital.
After all these deals, Crescent Point will not only have higher production, but new tax pools worth $777-million.
Crescent Point started the year with annual production of 80,000 barrels of energy per day, and an expected exit production of 85,000. Now its annual production is pegged at 88,500 barrels per day and its exit is 97,500 barrels per day.
Tim Kiladze