Schlumberger sells stake in Palliser Block to unnamed firm $430 million

By Medicine Hat News on October 19, 2024.

@MedicineHatNews

Oilpatch giant Schlumberger has sold its interest in the Palliser Block of southeast Alberta, a huge spread stretching from Drumheller to Brooks, the Houston-based petroleum services firm announced Thursday.

The sale to an unnamed company was announced ahead of the company’s third-quarter earnings release Friday.

“This transaction will reduce our direct exposure to commodity prices and associated earnings volatility as well as reduce our capital intensity,” said Stephane Biguet, the firm’s chief financial officer, in prepared remarks with the financial results.

“It also allows us to eliminate significant future abandonment liabilities.”

He stated cash proceeds total US$430 million to Schlumberger, which will also benefit from a reduction in well abandonment liabilities stated at US$260 million.

In late 2017, Schlumberger and private firm Torxen purchased the 800,000 acres of development rights and oil and gas facilities with a production stated at 54,000 barrels per day for US$1 billion from Cenovus.

Schlumberger became the “majority, non-operating” owner of the fields in Wheatland and Newell counties, while holding exclusive rights to capital and service work.

Torxen was founded by former Cenovus executive John Brannan.

The private company did not return calls to the News seeking comment on Friday.

11
-10