Baytex Energy to acquire oil sands leases for $120 million

Baytex Energy to acquire oil sands leases for $120 millionOil producer, Baytex Energy Corp is expected to acquire oil sands leases in the Cold Lake area of northeast Alberta under a deal worth $120 million.

The company is acquiring the project form an unnamed seller but many believe that the sellers is Koch Oil Sands Operating ULC. The company has agreed to acquire about 46 sections on the project that has an approved thermal project.

"The undeveloped oil sands leases are proximal to our core heavy oil assets at Cold Lake and are prospective for both thermal and cold development," Baytex said in a statement.

The company also said that the project comes with an approved steam-assisted gravity drainage project. The acquisition will be an addition to the company's asset portfolio that already includes thermal recovery projects at Seal in the Peace River Oil Sands and at Kerrobert in southwest Saskatchewan.

The company based in Calgary, Alberta deals with development and production of crude oil and natural gas in the Western Canadian Sedimentary Basin and in the Williston Basin in the U. S. About 87 per cent of Baytex's production is linked to crude oil, particularly heavy oil.

The company will use its revolving credit facility for paying for the acquisition that will close in early October.