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Delphi acquires oil and gas infrastructure

Calgary-based oil and gas firm Delphi Energy has agreed to acquire natural gas infrastructure and property in North West Alberta for C$11.8m. After financial close, it intends to dispose of 40 percent of its working interest in the assets to an undisclosed third party.

Calgary-based oil and gas firm Delphi Energy has agreed to acquire natural gas infrastructure and property assets in North West Alberta.

Delphi will pay
C$11.8m for the
assets

The company said in a statement it expects the transaction to acquire the assets in Gold Creek and Wapiti to close at the end of August, after which it has agreed with a third party to dispose of 40 percent of its working interest in the assets. After this disposition, Delphi’s interest will have a value of C$11.8 million (€7.6 million; $11 million).

Delphi's purchase includes three natural gas processing plants with a combined capacity of 720 million cubic feet per day, ten compression stations and 393 kilometres of pipelines. It will also provide incremental production of 400 barrels of oil per day, as well as proven and probable oil reserves of over 1.4 million barrels.

The C$11.8 million acquisition will initially be funded from Delphi’s credit facilities. The company said following the acquisition it will reduce the remainder of its second half field capital programme and allocate a larger portion of cash flow to debt reduction. It added it intends to lower its net debt by between C$2 and C$4 million by the end of 2009.