Cardinal Energy Ltd. has entered into agreements with two private companies to purchase assets in Cardinal's core Bantry area for an aggregate purchase price of approximately $27 million before adjustments (the "Acquisitions"). The Acquisitions add approximately 350 Boe/d (90% oil and NGLs) of high netback production. In connection with the Acquisitions, Cardinal also announces a bought deal private placement of approximately $28 million (the "Private Placement").
A key attribute of the acquired assets is that there is no royalty payable on the producing properties which results in high netbacks. In the current commodity price environment, Cardinal expects netbacks on the acquired production of approximately $50 per Boe. There are 5 sections of 100% working interest lands that come with the Acquisitions and management estimates that there are 6 horizontal development drilling locations and 4 vertical drilling locations on these lands.