PetroBakken Energy Ltd.’s $476-million cash and stock deal for Result Energy Inc. marks its second major acquisition in the Cardium play. The company now holds 150 net sections of land and has identified more than 400 potential drilling locations.
While the transaction looks expensive at an implied price of $5,600 to $6,300 per acre of Cardium land, only time will tell what the economics of the play truly are and what the land eventually yields.
One thing is clear: PetroBakken is making an aggressive move into the Cardium and this won’t be the last acqusition in the area, according to Raymond James analyst Justin Bouchard. The company has roughly $750-million of cash in the coffers.
Mr. Bouchard noted that potential targets on PetroBakken’s radar likely include West Energy Ltd., Midway Energy Ltd., Bellatrix Exploration Ltd. and Bonterra Oil & Gas Ltd.