KKR urgently sells Westbrick gas company
2022.11.18 13:36
KKR urgently sells Westbrick gas company
Budrigannews.com – Private equity firm KKR&Co (NYSE:) is seeking buyers of Canadian oil and gas producer Westbrick Energy Ltd to cash in on high energy prices.It is a potential deal of 11.5 billion to220 billion (ル1.13 billion toル1.5 billion).
The majority owner KKR aims to strike a deal by the end of the year, one of the sources said, KKR can still hold the company if it does not receive the appropriate offer.
According to Westbrick’s website, Paramount Resources (OTC:) Ltd owns a smaller stake. Paramount CEO Jim Liddell, Westbrick Director, could not be reached immediately.
The source requested anonymity because the plan is confidential. KKR declined to comment.
Strong oil and gas prices compared with the lows of 2014-15, after many were left behind by companies longer than their usual investment horizon of three to five years, private equity investors are still struggling.
The sale of Westbrick would mark an exit from the Canadian oil and gas production business for Kkr. Other large private equity firms and some international energy companies have raised concerns about the environmental impact and relatively poor returns of such investments in recent years.
KKR has owned West Brick for a decade, longer than most of its investments and has made logical sales, said one of the sources. KKR investedド250 million in Westbrick, which was a small producer in 2012.
Apart from Westbrick, Kkr’s other investments in Canada include gas processing assets and a stake in the coastal GasLink pipeline under construction.
Westbrick chief Executive Ken McCagherty, who has led the company since its inception in 2011, did not confirm or deny that the company was seeking an immediate sale.
“Anyone who knows me knows that Westbrick has been on sale every day since our existence,” he told Reuters by email.
He did not answer further questions, adding that it would not be surprising to have an interest in acquiring the company.
Based in Calgary, Alberta, Westbrick produced 36,000 oil equivalent per day (boepd) in 1 year by 2021, mostly gas in the Greater Pembina Basin, according to the latest available information on its website. By 2022/6, it is expected to reach 50,000 boepd.
Ryan Ferguson Young, president of Earth Horse Energy Advisors, said that when Westbrick gets a price close to the lower end of the expected range, it represents a cash flow lower than historical multiples due to unstable commodity prices and the upside situation where the spot price exceeds the futures price.
In the first half of 2022, kkr’s efforts to sell Westbrick fell by 53 percent toC1 billion, compared with 52 years ago, as merger and acquisition activity among Canadian oil and gas producers fell, Sayer Energy Advisors said.
($1 = 1.3337 Canadian dollars)
