Offering Details
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Under Review / BDO Canada Limited - Kingsland Oil Corp.
BDO Canada Limited - Kingsland Oil Corp.
Bankruptcy SaleBid Deadline: May 2, 2024
12:00 PM
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OVERVIEW
On January 5, 2024, Kingsland Oil Corp. (“Kingsland” or the “Company”) made an assignment into bankruptcy and BDO Canada Limited was appointed as the trustee in bankruptcy (the “Trustee”) of the bankrupt estate. The Trustee has engaged Sayer Energy Advisors to assist it with a sale of Kingsland’s oil and natural gas properties (the “Properties”).The Trustee has instructed that interested parties must provide a marked-up copy of a purchase and sale agreement (the “PSA”) acceptable to the Trustee with any offers submitted for the Properties. A copy of the PSA will be available for review to parties which execute a confidentiality agreement.
The Trustee has also provided a Sale Solicitation Process document (the “SSP”) outlining further details, and the terms and conditions of this sale. The SSP must be read in conjunction with the marketing material. A copy of the SSP is found here. All offers received at the bid deadline will be reviewed by the Trustee and the most acceptable offer may be accepted by the Trustee, subject to Inspector approval.
The Properties are located in the Delta West and Tompkins areas of southwestern Saskatchewan.
Kingsland ceased operations and shut-in operated production in August 2023. Prior to shut-in, average production net to Kingsland from the Properties for the first half of 2023 averaged approximately 21 boe/d consisting of 19 barrels of oil and 12 Mcf/d of natural gas.
Sales revenue from the Properties net to Kingsland for the first half of 2023 averaged approximately $40,000 per month.
Overview Map Showing the Location of Kingsland’s Properties
Production Overview
Kingsland ceased operations and shut-in operated production in August 2023. Prior to shut-in, average production net to Kingsland from the Properties for the first half of 2023 averaged approximately 21 boe/d consisting of 19 barrels of oil and 12 Mcf/d of natural gas.
Gross Production Group Plot of Kingsland’s Wells
LMR Overview
As of December 28, 2023, the Properties had a deemed net asset value of ($942,819) (deemed assets of $0 and deemed liabilities of $942,819), with an LMR ratio of 0.00.
The Company has a security deposit of $644,597 in place with the Saskatchewan Ministry of Energy and Resources which is not included in the numbers above.
Marketing Overview
Kingsland marketed its oil through Acme Energy Marketing Ltd. Oil was sold at the 08-10-015-20W3 battery via the Gull Lake Truck Terminal.
DELTA WEST
Township 15, Range 20 W3At Delta West, Kingsland owns a 100% working interest in two sections of land with P&NG rights from surface to the base of the Upper Shaunavon Formation along with several non-producing heavy oil wells. Production from Delta West consisted primarily of heavy oil from the Delta West Upper Shaunavon pool. The Company also has two water disposal wells at Delta West.
Kingsland ceased operations and shut-in production from the Properties in August 2023. Prior to shut-in, average production net to Kingsland from the Delta West property for the first half of 2023 averaged approximately 19 boe/d consisting of 19 barrels of oil and two Mcf/d of natural gas.
Delta West, Saskatchewan – Gross Production Group Plot of Kingsland’s Wells
Upper Shaunavon Formation
The Upper Shaunavon in the Delta West area is characterized by a series of limestone beds with interbedded shale streaks. The wells at Delta West have been completed using a variety of techniques, including selective perforation of certain porous stringers. Upside in portions of the thick reservoir can be accessed with further development drilling.
The following well logs show a typical section from the Upper Shaunavon Formation in the well Kingsland Delta West 31/07-10-015-20W3/0.
Kingsland Delta West 31/07-10-015-20W3/0 – Upper Shaunavon Formation Type Log
Since initial development of the Delta West Upper Shaunavon pool began in 1995, the area has been further developed through horizontal drilling primarily by Whitecap Resources Inc. as recently as 2023. The following map shows the offsetting development targeting heavy oil from the Cantaur (Mannville Group) and Upper Shaunavon pools outlined in green. Wells drilled since 2021 are shown in red.
Delta West Facilities
At Delta West, Kingsland has working interests in the following facilities.
Delta West Reserves
The Company does not have a third-party reserve report relating to the Delta West property.
Delta West LMR as of December 28, 2023
As of December 28, 2023, the Delta West property had a deemed net asset value of ($740,219) (deemed assets of $0 and deemed liabilities of $740,219), with an LMR ratio of 0.00.
The Company has a security deposit of $644,597 in place with the Saskatchewan Ministry of Energy and Resources which is not included in the numbers above.
Delta West Well List
Click here to download the complete well list in Excel.
TOMPKINS
Township 13-14, Range 20-22 W3At Tompkins, Kingsland holds working interests ranging from 20% to 100% in 5.5 sections of land along with several non-producing natural gas wells. Production from Tompkins consisted primarily of natural gas from the Upper Shaunavon Formation.
Kingsland ceased operations and shut-in production from the Properties in August 2023. Prior to shut-in, average production net to Kingsland from Tompkins for the first half of 2023 averaged approximately two boe/d consisting of nine Mcf/d of natural gas.
Tompkins, Saskatchewan – Gross Production Group Plot of Kingsland’s Wells
Tompkins Facilities
At Tompkins, Kingsland has working interests in the following facilities.
Tompkins Reserves
The Company does not have a third-party reserve report relating to the Tompkins property.
Tompkins LMR as of December 28, 2023
As of December 28, 2023, the Tompkins property had a deemed net asset value of ($202,600) (deemed assets of $0 and deemed liabilities of $202,600), with an LMR ratio of 0.00.
The Company has a security deposit of $644,597 in place with the Saskatchewan Ministry of Energy and Resources which is not included in the numbers above.
Tompkins Well List
Click here to download the complete well list in Excel.
PROCESS & TIMELINE
Sayer Energy Advisors is accepting cash offers as outlined in the SSP to acquire the Properties until 12:00 pm on Thursday May 2, 2024.
Sayer Energy Advisors does not conduct a "second-round" bidding process; the intention is to attempt to conclude a
transaction(s) with the party(ies) submitting the most acceptable proposal(s) at the conclusion of the process.
transaction(s) with the party(ies) submitting the most acceptable proposal(s) at the conclusion of the process.
Sayer Energy Advisors is accepting cash offers from interested parties until
noon on Thursday May 2, 2024.
NOTE REGARDING A SAYER PROCESS
On each and every offering brochure generated by Sayer, you will note the sentence “Sayer Energy Advisors does not conduct a “second-round” bidding process; the intention is to attempt to conclude a sale of the Properties with the party submitting the most acceptable proposal at the conclusion of the process.” What this means is that Sayer will not go back to multiple parties at the same time after bids are received, asking them all for a second bid. We determine which party submitted the most acceptable proposal and then we attempt to negotiate acceptable terms with that party in a “one-off” situation.
If the process involves a cash sale of a property or company and the party which submitted the most acceptable proposal has met our client’s threshold value, that offer will be accepted. If this proposal does not meet our client’s threshold value, then we will advise that party that the offer is not quite what our client was expecting, and we will ask them to increase the offer. If that offer is not acceptable to our client, we will then move down to the party which submitted the next most acceptable proposal and we will then work with that party to attempt to meet our client’s threshold value.
In the extremely rare circumstance where two or more parties submit virtually identical proposals, we will contact all parties, we will advise them of this situation and we will ask them to submit a revised proposal. Once these are received, we will work with the party which has submitted the most acceptable proposal.If the process involves a cash sale of a property or company and the party which submitted the most acceptable proposal has met our client’s threshold value, that offer will be accepted. If this proposal does not meet our client’s threshold value, then we will advise that party that the offer is not quite what our client was expecting, and we will ask them to increase the offer. If that offer is not acceptable to our client, we will then move down to the party which submitted the next most acceptable proposal and we will then work with that party to attempt to meet our client’s threshold value.
CONFIDENTIALITY AGREEMENT
Parties wishing to receive access to the confidential information with detailed information relating to this opportunity should execute the Confidentiality Agreement and return one copy to Sayer Energy Advisors by courier, email (tpavic@sayeradvisors.com) or fax (403.266.4467).Included in the confidential information is the following: summary land information, most recent net operations summary, LMR information and other relevant technical information.
Download Confidentiality Agreement
To receive further information on the Properties please contact Tom Pavic, Ben Rye or Sydney Birkett at 403.266.6133.