Paramount Resources Ltd. and Trilogy Energy Corp. to merge; Paramount to also acquire Apache Canada Ltd. for $459.5 million

Apache Canada’'s primary developments are located at Wapiti, Kaybob/Ante Creek and Central Alberta/Photo: CNW Group/Paramount Resources Ltd.

CALGARY, AB – Paramount Resources Ltd. announced today that they will acquire Apache Canada Ltd. for $459.5 million and also merge with Trilogy Energy Corp.

Paramount says they will fund the Apache Canada acquisition with cash on hand and no debt will be assumed.

“Paramount has agreed to merge by way of an arrangement under the Business Corporations Act (Alberta), pursuant to which Paramount would acquire all of the common shares and non-voting shares of Trilogy not already owned by Paramount in exchange for Class A common shares of Paramount on the basis of one Paramount share for every 3.75 Trilogy shares.”

Paramount sold their Musreau deep cut gas processing plant and properties in 2016 and repaid all of their debt that was then outstanding.

The company says there will be many benefits to the integration of the three companies.

“Paramount, upon acquiring Apache Canada and merging with Trilogy, will become a Montney, Duvernay and Deep Basin focused intermediate exploration and production company with the financial strength to accelerate the development of a portfolio of top-tier resource plays, unlocking the value of the underlying resources. The integration of the three companies will generate operational synergies, optimize cost structures, offer financial flexibility and provide economies of scale. Paramount’s diversified production base will be capable of delivering repeatable, low risk growth and generating free cash flow in a variety of price environments.”

The company also pointed to the Montney acreage which covers approximately 372,000 net acres.

“With near-term production growth focused at Karr and a new turn-key resource play at Wapiti which is anticipated to add material new production in mid-2019.”

Paramount President and Chief Executive Officer, Jim Riddell, says that these acquisitions will put the company in a great spot moving forward.

“These transactions represent Paramount’s next significant resource capture, building on the transformation of the Company we initiated in 2016. We have replaced more than the liquids-rich Montney lands and reserves we sold in 2016 and acquired a suite of top-tier development opportunities.

We believe the 46,000 Montney acres we are acquiring at Wapiti are a continuation of Paramount’s liquids-rich resource play at Karr, where our drilling and completion programs have been delivering record results for Paramount. These transactions combine Trilogy’s and Apache Canada’s complementary land positions at Kaybob, materially increasing the size of those Montney and Duvernay resource plays.

The combination of these three organizations will result in synergies in field operations, general and administrative expenses and development capital expenditures, as well as the optimization of processing and transportation infrastructure and commitments.”

Paramount says the closing of the Apache Canada acquisition is expected to occur in August of this year.