Pumpjacks at work pumping crude oil near Stettler, Alta., June 20, 2007.Larry MacDougal/The Canadian Press
Whitecap Resources Inc. is the latest Canadian oil and gas firm to issue shares despite slumping oil prices.
Calgary-based Whitecap said on Tuesday it plans to issue $95-million in shares in a bought deal. It plans to use proceeds to reduce debt resulting from a December acquisition that increased the company's interest in the Boundary Lake oil play in northeastern British Columbia.
The move adds to a steady trickle of oil-patch financings in recent weeks, showing that investors are prepared to wager on companies best positioned to navigate the collapse in oil prices.
This month, Canadian oil and gas firms raised $500-million selling shares, including new issues from Seven Generations Energy Ltd., Raging River Exploration Ltd. and Advantage Oil and Gas Ltd.
Whitecap, which also operates oil assets in southwest Alberta and in west-central Saskatchewan, is issuing 13.7 million shares at $6.90 each. It said members of the company's board and its executives are participating in the financing, which is led by National Bank Financial Inc.
The shares were down nearly 4 per cent at $6.95 in midday trading on the Toronto Stock Exchange.
The company also increased its production guidance for 2016 by 5 per cent to 38,800 barrels of oil-equivalent per day, from 37,000 boe/d previously, citing strong results at its Boundary Lake project.