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I3 Energy signs agreement to acquire Canadian producer and carbon offset group for US$59mln

Gain produced at a rate of around 11,000 barrels per day equivalent throughout 2019

i3 Energy PLC -

i3 Energy PLC (I3E) has signed a binding agreement to acquire private Canadian oil and gas company Gain Energy through a reverse takeover for US$58.8mln.

AIM-listed I3 had flagged the deal two weeks ago, but not named the target.

Gain operates in the Western Canadian Sedimentary Basin, the same area of operation as Toscana, another Canadian company I3 agreed to buy two weeks ago.

Gain produced at a rate of around 11,000 barrels per day equivalent (boepd) throughout 2019 and generated around US$34mln in underlying profits.

Another attraction of the deal is the Canadian group’s stake in the Weyburn carbon-capture plant, I3 said in a statement.

This is the fourth largest carbon capture, utilisation and storage project in the world, it added, with Gain's interest estimated to offset approximately 17,760 boepd of scope 1 greenhouse gas emissions.

Gain’s assets will add 26.4 MMboe (million barrels) producing reserves and 69.4 MMboe 2P reserves to i3's portfolio, the group noted.

Toscana, meanwhile, produced 1,065 barrels per day in 2019 and generated US$4mln in field netbacks, but has US$89mln in accumulated tax pools that can be applied to Gain’s production.

I3 said its shares will remain suspended on AIM until a readmission document is completed that will contain fuller details of both transactions.

At the time of the Toscana deal announcement, I3 said it was in talks with its investors and brokers and is seeking funding for the consideration of the proposed acquisition and general corporate purposes.

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Price: 6.1 GBX

Market: AIM
Market Cap: £53.86 k


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on 30/3/20

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