CALGARY, AB, March 18, 2021 /CNW/ - Spartan Delta Corp.
("Spartan") (TSXV: SDE) is pleased to announce the closing
of its previously announced strategic acquisitions (the
"Acquisitions"), including the corporate acquisition of
Inception Exploration Ltd. ("Inception"), a Montney focused arm's length private company
with operations in the Gold Creek area of north-west Alberta (the "Inception Acquisition"),
and the purchase of assets located primarily in the Simonette area
of north-west Alberta and
Willesden Green area of west-central Alberta.
Concurrent with the Acquisitions, Spartan completed its
previously announced non-brokered private placement (the
"Private Placement") of 6,250,000 common shares of Spartan
(the "Common Shares") at a price of $4.00 per Common Share and 10,976,626 Common
Shares issued on a "CDE" flow-through basis (the "Flow-Through
Shares") at a price of $4.92 per
Flow-Through Share, raising aggregate gross proceeds of
$79.0 million. In addition, net
proceeds of $44.09 million have been
released to Spartan pursuant to its previously announced bought
deal financing (the "Public Offering", and together with the
Private Placement, the "Financings") of 11,250,000
subscription receipts ("Subscription Receipts") at a price
of $4.00 per Subscription
Receipt.
The Private Placement and Public Offering collectively resulted
in the issuance of 28,476,626 Common Shares for total gross
proceeds of $124.0 million. The
Acquisitions resulted in the issuance of 25,227,564 Common Shares.
Post completion of the Financings and the Acquisitions, Spartan has
113,932,285 Common Shares issued and outstanding.
The Acquisitions
The Acquisitions add a new core area in the Alberta Montney and
complement Spartan's existing core area in the Cardium and
Spirit River in west-central
Alberta. The Inception Acquisition
supplements Spartan's existing position in the Montney fairway, providing multiple years of
development inventory and adding to its Montney growth strategy. With the
closing of the Acquisitions, Spartan expects 2021 production to
average between 35,500 to 37,500 boe/d, consisting of 4% crude oil,
4% condensate, 23% NGLs and 69% natural gas. The acquired assets
increase Spartan's oil-weighted production and drilling inventory,
providing further commodity diversification, and include strategic
processing facilities and infrastructure with limited additional
capital required to increase production volumes. Spartan plans to
apply principles consistent with its current operations to improve
efficiencies, reduce operating costs and enhance margins within the
acquired assets. For further details on the Acquisitions, see
Spartan's press release dated February 16,
2021.
The Financings
In accordance with their terms, each Subscription Receipt issued
pursuant to the Public Offering was exchanged for one Common Share
(each, an "Underlying Share") upon closing of the Inception
Acquisition and the completion of the Private Placement, and the
aggregate net proceeds of $44.09
million from the Public Offering were released to Spartan
from escrow. Holders of Subscription Receipts are not required to
take any action in order to receive the Underlying Shares.
The gross proceeds from the issuance of the Flow-Through Shares
will be used to incur and renounce Canadian development expenses
pursuant to the Income Tax Act (Canada). Pursuant to applicable securities
laws, the Common Shares and Flow-Through Shares issued pursuant to
the Private Placement are subject to a hold period of four months
plus one day following the distribution date. The Private Placement
remains subject to final approval of the TSX Venture Exchange (the
"TSXV").
The net proceeds from the Public Offering were used to eliminate
Spartan's indebtedness under its syndicated credit facilities, with
the balance of the Public Offering proceeds, in addition to the net
proceeds from the issuance of the Common Shares under the Private
Placement, currently anticipated to be used to fund Spartan's
drilling and capital spending program, future acquisitions and
general working capital purposes.
Additions to the Spartan Board of Directors
Spartan is also pleased to announce that Mr. Steve Lowden and Mr. Elliot S. Weissbluth have joined the board of
directors of Spartan.
Mr. Steve Lowden is a
petroleum engineer with over 35 years' experience in the
international oil and gas sector. He has a track record of building
energy businesses throughout the world and was previously Chairman
and Chief Executive Officer of New Age (African Global Energy)
Ltd., Executive Director and Officer of Marathon Oil and Premier
Oil. At Premier Oil, Steve held a number of roles including
Executive Director of Development and Production, Business
Development and Exploration. He added more than one billion boe of
new resource, and operated and managed multiple emerging market oil
and gas projects from discovery to production. At Marathon, Steve
was President of Marathon International, Head of Corporate Business
Development and Head of the Global Integrated Gas business. Since
June 2017, he has acted as an advisor
to a number of governments, energy businesses, private energy
groups and corporate restructurings representing the debt and
security holders. Mr. Lowden has also served as a board member for
a number of private and public companies.
Mr. Elliot S. Weissbluth
is an accomplished entrepreneur and financial business leader. Mr.
Weissbluth retired last year as chairman of the board of Hightower
Inc., a U.S. financial services company he founded in 2007. Mr.
Weissbluth has been a member of Worth Magazine's Power 100 list of
top U.S. business leaders, as well as rankings among the most
influential figures in the financial services industry. Before
Hightower, Mr. Weissbluth was Founding Investor, Director and
President of U.S. Fiduciary, a financial advisory company.
Previously, from 2000 to 2003, he led the development of the
Alternative Investments group at RogersCasey and conceived and
launched the firm's first hedge fund advisory service for
institutional clients.
Advisors
National Bank Financial Inc. acted as financial advisor to
Spartan in respect of the Acquisitions and the Financings. Eight
Capital acted as strategic advisor to Spartan. Stikeman Elliott LLP
acted as legal counsel to Spartan in respect of the Acquisitions
and the Financings. Stifel FirstEnergy acted as financial advisor
to Inception Exploration Ltd. in respect of the Inception
Acquisition.
About Spartan Delta Corp.
Spartan is an energy company whose ESG-focused culture is
centered on generating sustainable free funds flow through oil and
gas exploration and development. Building on its existing
high-quality, low-decline operated production in west-central
Alberta, and oil-weighted growth
assets in the Alberta Montney, Spartan intends to continue
acquiring diversified assets that can be restructured, optimized
and rebranded, financially or operationally, yielding an increase
to shareholder value. Further detail is available in Spartan's
corporate presentation, which can be accessed on its website at
www.spartandeltacorp.com.
READER ADVISORIES
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements and
forward-looking information within the meaning of applicable
securities laws. The use of any of the words "expect",
"anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "believe", "plans", "intends"
and similar expressions are intended to identify forward-looking
information or statements. More particularly and without
limitation, this press release contains forward looking statements
and information concerning: the benefits of the Acquisitions;
expected post-Acquisitions production of Spartan; expected future
drilling inventory; future consolidation opportunities and
acquisition targets; future operational and technical synergies
resulting from the Acquisitions; capital requirements; the use of
proceeds from the Financings; receipt of required TSXV approvals;
and Spartan's business plan, generally.
The forward-looking statements and information are based on
certain key expectations and assumptions made by Spartan, including
expectations and assumptions concerning the business plan of
Spartan, the receipt of all TSXV approvals, the timing of and
success of future drilling, development and completion activities,
the performance of existing wells, the performance of new wells,
the availability and performance of facilities and pipelines, the
geological characteristics of Spartan's properties, the
characteristics of the acquired assets, the successful integration
of the acquired assets into Spartan's operations, the successful
application of drilling, completion and seismic technology,
prevailing weather conditions, prevailing legislation affecting the
oil and gas industry, commodity prices, royalty regimes and
exchange rates, the application of regulatory and licensing
requirements, the availability of capital, labour and services, the
creditworthiness of industry partners and the ability to source and
complete acquisitions.
Although Spartan believes that the expectations and assumptions
on which such forward-looking statements and information are based
are reasonable, undue reliance should not be placed on the
forward-looking statements and information because Spartan can give
no assurance that they will prove to be correct. By its nature,
such forward-looking information is subject to various risks and
uncertainties, which could cause the actual results and
expectations to differ materially from the anticipated results or
expectations expressed. These risks and uncertainties include, but
are not limited to, fluctuations in commodity prices, changes in
industry regulations and political landscape both domestically and
abroad, foreign exchange or interest rates, stock market
volatility, impacts of the current COVID-19 pandemic and the
retention of key management and employees. Please refer to
Spartan's most recent Annual Information Form and MD&A for
additional risk factors relating to Spartan, which can be accessed
either on Spartan's website at www.spartandeltacorp.com or under
Spartan's profile on www.sedar.com. Readers are cautioned not to
place undue reliance on this forward-looking information, which is
given as of the date hereof, and to not use such forward-looking
information for anything other than its intended purpose. Spartan
undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
law.
Other Measurements
All dollar figures included herein are presented in Canadian
dollars, unless otherwise noted.
This press release contains various references to the
abbreviation "boe" which means barrels of oil equivalent. Where
amounts are expressed on a boe basis, natural gas volumes have been
converted to oil equivalence at six thousand cubic feet (Mcf) per
barrel (bbl). The term boe may be misleading, particularly if used
in isolation. A boe conversion ratio of six thousand cubic feet per
barrel is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead and is significantly different
than the value ratio based on the current price of crude oil and
natural gas. This conversion factor is an industry accepted norm
and is not based on either energy content or current prices. Such
abbreviation may be misleading, particularly if used in
isolation.
References to "oil" in this press release include light crude
oil and medium crude oil, combined. NI 51-101 includes condensate
within the product type of "natural gas liquids". References to
"natural gas liquids" or "NGLs" include pentane, butane, propane,
ethane and condensate. References to "gas" or "natural gas" relates
to conventional natural gas.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this press
release.
SOURCE Spartan Delta Corp.
