Athabasca Oil has announced a collaboration with Cenovus Energy to establish Duvernay Energy, a standalone company with valuable assets in Alberta's Kaybob Duvernay play.
Ownership and Management
Under the agreement, Athabasca will hold a 70% equity interest in the newly formed company, while Cenovus will possess the remaining 30%. As part of a management and operating services agreement, Athabasca will oversee the operations of Duvernay Energy.
Robert Broen, the current President and CEO of Athabasca Oil, will take on the role of Chairman, President, and CEO of Duvernay Energy. The board of Duvernay will consist of three members nominated by Athabasca and one member nominated by Cenovus.
Strong Financial Foundation
At its inception, Duvernay Energy will be financially robust. It will have no outstanding debt and will begin with $40 million in cash and a $50 million credit facility, courtesy of Athabasca.
Effective Date and Closing
The agreement is set to become effective on January 1, 2024. The closing of the deal is anticipated to occur in the first quarter of the following year.
Duvernay Energy is primed for success, with exposure to approximately 200,000 gross acres and around 500 gross future well locations within the Kaybob Duvernay play, as conveyed by Athabasca.