New York-listed Apache said it has agreed to sell its Canadian unit with assets in Alberta and British Columbia to Paramount Resources, completing its exit from the country as it looks to focus its portfolio in U.S., U.K., and Egypt.
Last month, Apache sold its Provost assets to a private buyer, while selling its assets at Midale and House Mountain, located in Saskatchewan and Alberta, to Calgary-based Cardinal Energy Ltd.
With the latest transaction, the value of the three deals is approximately $713 million (CA$ 927 million), the U.S. company said in a statement.
“This strategic decision will enhance the company's resource allocation to its primary growth areas, particularly within the Permian Basin," said John J. Christmann IV, Apache's chief executive officer and president.
Production from Apache's Canadian operations averaged approximately 300 million cubic feet of gas equivalent per day for the second-quarter 2017, of which approximately two-thirds is natural gas. The Cardinal transaction closed in late June, and the remaining two are expected to close by the end of August 2017.
Apache said the proceeds from the three transaction, subject to customary closing adjustments, will be used to fund a portion of the company’s 2017-2018 capital program, to reduce debt, or to improve overall liquidity.
Apache budgeted $125 million of capital expenditures to Canada for 2017 and 2018. Unspent allocations will be redirected to other areas of the portfolio. The company plans to update its 2017 and 2018 guidance following the closings of the three transactions.
"With our decision to exit Canada, Apache's resulting global portfolio is more streamlined and our resources more focused. Our strong positions and enhanced focus in our core areas will drive improvements to overall returns on capital invested going forward," Christmann said.