Touchstone Exploration Inc. said Jan. 20 it has entered into an agreement to sell certain midstream assets and associated petroleum and natural gas (PNG) rights to Quattro Exploration and Production Ltd.
The deal is valued at C$4.15 million (US$2.8 million) and includes C$650,000 in cash and C$3.5 million in securities.
The assets include Touchstone’s Kerrobert, Saskatchewan facility and infrastructure.
The property contributed an average of 100 barrels per day of heavy oil during the three months ended Sept. 30, and was a legacy Petrobank combustion project.
With no intent to pursue combustion projects now or in the future, the company had no development plans for the property, the release said.
Through the sale, Touchstone will eliminate an internally estimated C$3.33 million in future abandonment liabilities associated with the assets, according to the release.
The transaction is effective Dec. 31 and is expected to close on or before Feb. 15. Following the sale, Touchstone has an interest in 32,723 acres of undeveloped land in Saskatchewan focusing mainly on the Viking formation, the release said.