Oil and gas company i3 Energy exercised its option to acquire all of the issued and outstanding common shares of Toscana Energy on Tuesday.
i3 snapped up the outfit’s “low-decline, long-life, light oil and gas fields” for roughly $60m, which will be satisfied by the issue of 4.39m new shares to Toscana shareholders upon completion.
The AIM-listed firm said the assets produced an average of 1,065 barrels of oil equivalent per day and generated CAD $5.5m (£3.26m) of field netback at an average breakeven price of CAD $30.43 (£18.08) per barrel.
Chief executive Majid Shafiq said: “In March of this year we announced our entry into the Western Canadian sedimentary basin via an option to acquire Toscana Energy Income Corporation, which was to provide a platform to execute on a strategy for the rapid growth of a Canadian onshore production portfolio via M&A.
“The acquisition of the proposed assets would be the first follow-on transaction in our business plan and, would be transformational for i3, adding material, low-cost per barrel, low-decline production, with significant organic growth optionality.”
I3’s shares were suspended from trading on AIM as the transaction was classified as a reverse takeover. The group intends to pursue a listing on the Toronto stock exchange.
As of 1105 BST, i3 shares were suspended at 6.10p.