Persist Oil and Gas Inc. and Dienerian Resources Inc. have been merged into one transaction of all shares.
Under the deal, Persist’s executive team will lead the combined company, with Dienerian’s backer investment firm Siguler Guff holding half of the board seats, according to a recent joint press release. Siguler Guff also made a preferred equity commitment of approximately $29.4 million (CAD 40 million) to the pro forma combined company.
According to Dienerian’s website, the company was acquired and merged by Persist on June 27.
The transaction strengthens Persist’s position as an emerging player in southern Alberta’s Mannville Formation oil development, with a pro forma footprint of more than 220,000 net acres, which now includes about 60,000 net acres of liquids-rich Montney terrain , and a production of approximately 4,250 barrels of oil equivalent per day (boepd), according to the statement. The asset base and new preferred capital commitment will allow the combined company to “accomplish a critical mass of self-sustaining free cash flow generation sooner,” the statement said.
Persist will use cash flow from operations and the new preferred equity commitment to continue developing its core asset in the Mannville Stack oilfield in southern Alberta, where it recently drilled the first well in its development program of summer, according to the release. The company averaged 706 boepd in the initial production rate in the two most recently drilled and completed wells in the Basal Quartz formation.
“Persist’s robust operating cash flows combined with the new preferred capital commitment has resulted in substantial deleveraging and increased liquidity. The high level of working capital combined with increased borrowing capacity will provide the combined company with ample capital to grow over the next two years,” the statement said.
In addition, Persist’s low-cost, oil-weighted drilling inventory in southern Alberta, combined with Dienerian’s extensive Montney liquids-rich natural gas drilling inventory, provides “flexibility in the allocation of capital based on the commodity price environment and other macroeconomic factors,” the statement said.
“This merger and subsequent investment demonstrate Siguler Guff’s continued commitment to providing flexible capital solutions to the exploration and production sector,” said Panigrahi, CEO and Head of Energy Investments at Siguler Guff.
“Our new partnership with Siguler Guff could not have come at a better time. The addition of Dienerian’s assets and the new preferred equity commitment allows Persist to accelerate its development plans and substantially increase shareholder value over the next two years,” added Persist President, CEO, and Director Mass Geremia said.
Persist is a privately held oil and gas exploration and production company based in Calgary, Alberta, Canada, founded in 2018. Persist has extensive land positions in established hydrocarbon streets in Alberta, including the Mannville Stack oil in southern Alberta, central Alberta Cardium oil and Wabamun oil, and central Alberta Mannville natural gas before the merger, according to the company.
Dienerian was formed in 2017 with a commitment from Siguler Guff, the company’s largest investor, to develop its core Wild River area in the liquids-rich Montney formation. Between 2017 and 2023, the company expanded its land position to approximately 60,000 acres, drilled several successful wells and built substantial processing infrastructure, according to Dienerian.
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