Penn West granted clearance for C$975 mn Saskatchewan asset sale

Canada’s Commissioner of Competition has issued a notice under the Competition Act that grants clearance to Penn West and Teine Energy Ltd.to complete the previously announced sale of all of the former’s Saskatchewan assets, including its Dodsland Viking area, for cash consideration of C$975 million, subject to normal closing adjustments. This Competition Act clearance is the only regulatory approval needed to complete the sale.

Penn West also announces that the closing of the sale of its Saskatchewan assets is expected to occur on or about June 24. The completion of the sale remains subject to customary closing conditions. As a result, the company expects to be fully in compliance with all of its financial covenants at the end of the second quarter and the remainder of 2016.

In addition, in connection with the previously announced Alberta asset dispositions for total proceeds of approximately C$140 million, Penn West is pleased to announce that approximately C$27 million of these asset dispositions have been completed, with the sales of the remaining approximately C$113 million of assets expected to close on or about June 27, subject to customary closing conditions.

The total cash consideration from asset dispositions to date in 2016 is approximately C$1.3 billion, reducing the company’s pro forma net debt to approximately C$600 million from C$2.1 billion at year-end 2015.