Petronas Offering Canadian Deep Basin Assets for Sale

Petronas, Malaysia’s state-owned oil and gas company, is offering to sell some 400,000 acres (250,000 net) of multi-zone oil and natural gas rights in western Canada’s Deep Basin.

The sale process marks the first retreat by Petronas from western Canada since it abandoned the Pacific Northwest LNG project in July. At the time, it said it was “committed to developing our significant natural gas assets in Canada.”

Progress Energy, the Canadian subsidiary of Petronas, owns conventional natural gas assets in the Deep Basin region of the Canadian province of Alberta and unconventional gas assets in the North Montney area of British Columbia.

"The potential sale of our Deep Basin assets, which represents a small portion of Progress Energy’s resource base, would allow us to focus on our North Montney development, which represents significant growth opportunities in Canada," the company said October 4 in a statement e-mailed to NGW.

BMO Capital Markets has been retained to conduct the sale process, which will begin with the opening of a data room on October 10, according to an information brief posted on its web site. Bids are expected to be received in early November.

The assets being offered are currently producing about 17.5mn ft³/day of natural gas and about 2,500 b/day of crude oil and natural gas liquids, with production potential from up to five zones. Proved plus probable gas reserves have been estimated at about 107bn ft³.

The package also includes minority working interests in three Deep Basin gas plants and 27mn ft³/day of firm service agreements on TransCanada’s Nova transmission system.

Dale Lunan