Sprott Resource Corp said on Tuesday it was exploring a sale of Waseca Energy Inc, a 81 percent owned oil subsidiary that has tripled the value of its oil and gas properties since the end of 2010, Reuters reports.
Reuters – Sprott Resource Corp said on Tuesday it was exploring a sale of Waseca Energy Inc, a 81 percent owned oil subsidiary that has tripled the value of its oil and gas properties since the end of 2010.
Sprott, which invests and operates through subsidiaries in the natural resources sector, said a sale of the unit was one of a range of alternatives being considered under a strategic review.
“This process could result in a sale of Waseca, a sale of a material portion of the Waseca’s assets, or a corporate reorganization among other alternatives,” the company said in a statement.
Waseca Chief Executive Michael Watson said the net present value of the company’s oil and gas properties had grown from C$108.9 million at the end of 2010 to C$333.9 million at the end of last month. In the same period, oil production rose from 1,050 barrels a day to 3,000 bbl/d.
Waseca explores for and develop heavy oil resources in the Lloydminster area of Canada in central Alberta and Saskatchewan.
Sprott Resource first invested in the company in January 2010 and has total investment in the company of C$44.2 million.
Waseca has retained RBC Rundle, a division of RBC Capital Markets, to assist with the process. Sprott said there were no guarantees the process would result in a transaction.