An energy company operating in Saskatchewan and Manitoba is selling off a number of its assets as they've entered into an agreement for the sale.
Vermilion Energy Inc. is selling off its Saskatchewan and Manitoba assets for cash proceeds of $415 million to an unnamed buyer. With the help of the sale, Vermillion is hoping to lower their current net debt to $1.5 billion by the end of the year.
The total assets are stated by Vermillion to be producing around 10,500 barrels of oil equivalent a day, forecasted to provide $110 million in annual net operating income at the current commodity prices.
The company believes that by the time they've sold off the assets, production would average between 120,000 and 125,000 boe/d with capital expenditures in the range of $680 to $710 million.
The company states in its release that the change is part of a bigger shift in their operations.
"The transaction marks another significant step in our strategic plan to high-grade the asset portfolio that began three years ago, shifting our focus toward long-duration, scalable assets with a deep inventory of high-return on capital opportunities. Our liquids-rich gas position in Western Canada, combined with strategic acquisitions in Europe and significant exploration success in Germany, have reframed Vermilion's global gas franchise that will serve shareholders for years to come."
The transaction has an effective date of May 1, 2025 and is anticipated to close in quarter 3 2025, subject to receipt of regulatory approvals and the satisfaction of other customary closing conditions.