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Energy and Resources Crescent Point amasses major position in Alberta shale oil play

Crescent Point Energy Corp. has amassed a major position in an emerging Alberta shale oil play, a step out for a producer better known for operations in neighbouring Saskatchewan.

Crescent Point said it snapped up drilling rights on 355,000 net acres in the eastern flank of the Duvernay shale oil formation, adding to a rush of land buys that has pushed up prices and stoked expectations of big spending in the oil-rich area.

Crescent Point revealed the new holdings after markets closed Tuesday, confirming earlier speculation that CEO Scott Saxberg was building a sizable position in the region, which is located near Red Deer, Alta.

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It marks a departure for a company that in recent years has focused spending on expanding operations in Utah and is best known for hydraulic fracturing operations in southern Saskatchewan.

Calgary-based Crescent Point has faced pressure to show it can boost production without making deals financed through big equity issues. The Toronto-listed shares have tumbled 40 per cent over the past year.

The company said it picked up lands for an average cost of $315 per acre and that it has budgeted to drill four wells in the region in the first half of the year.

Other companies active in the east Duvernay include Raging River Exploration Inc. as well as privately held Artis Exploration Ltd. and Vesta Energy Corp.

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