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Copper Tip Energy Services
Hazloc Heaters
WEC - Western Engineered Containment
WEC - Western Engineered Containment
Hazloc Heaters
Copper Tip Energy

Crescent Point Announces Sale of Saskatchewan Gas Infrastructure Assets for $500 Million

CALGARY – Crescent Point Energy Corp. (“Crescent Point” or the “Company”) (TSX and NYSE: CPG) is pleased to announce that it has entered into a definitive agreement (the “Agreement”) to sell certain associated gas infrastructure assets (the “Assets”) in Saskatchewan to Steel Reef Infrastructure Corp. (“Steel Reef” or the “Purchaser”) for total cash consideration of $500 million.

“Through the sale of these gas infrastructure assets, we will unlock value for our shareholders and further strengthen our financial position. We have now entered into agreements to sell, or have sold, in aggregate approximately $1.45 billion of assets in 2019,” said Craig Bryksa, President and CEO of Crescent Point. “This sale is also aligned with our strategy, as it allows us to further focus on our core competencies to strengthen our corporate returns.”


Through the sale of the Assets, Crescent Point will monetize nine natural gas gathering and processing facilities and two gas sales pipelines currently in operation within Saskatchewan. These gas processing facilities and associated sales gas lines have a total throughput capacity of more than 90 MMcf/d. The Assets do not include any oil-related infrastructure.

Under the terms of the Agreement, the Company will enter into certain long-term take-or-pay commitments with Steel Reef in exchange for Steel Reef granting Crescent Point processing rights at the facilities. The expected annual cash flow to the Purchaser is estimated at approximately $47 million, excluding cash flow from third parties. Steel Reef, an established midstream company with other gas processing assets in Saskatchewan and a strong track record of environmental, health and safety performance, will operate the Assets.

As part of the Agreement, Steel Reef has committed to fund an upcoming 12 MMcf/d expansion of one of the gas processing facilities, reducing the need for capital that would otherwise be required by Crescent Point. Steel Reef’s cost to construct this expansion is estimated to be approximately $30 million, which will be in addition to the purchase price of $500 million. This facility expansion is expected to begin in 2020 and be completed within approximately 12 to 18 months following closing of the Asset sale. The expansion is expected to further enhance sales volumes while also reducing the facility’s emissions intensity.

RBC Capital Markets acted as exclusive financial advisor to the Company on this sale. GMP FirstEnergy represented Crescent Point as its strategic advisor. The transaction is expected to close in first quarter 2020, subject to customary closing conditions and regulatory approvals.

Crescent Point is also pleased to report that it continues to advance negotiations for third party development of a new sales oil pipeline. This pipeline is expected to enhance the Company’s market access and realized pricing for its southeast Saskatchewan oil production. Management expects that the new sales oil pipeline will take approximately 12 months to construct and bring in service, once an agreement is finalized.


Crescent Point’s disciplined capital allocation is centered on returns with a priority on continued balance sheet strength.

Upon closing of the sale of the Assets, the Company expects that its net debt will be reduced from approximately $2.8 billion at year-end 2019 to approximately $2.3 billion while also reducing Crescent Point’s net debt to adjusted funds flow ratio by approximately 0.3 times. The Company continues to retain significant liquidity and unutilized credit capacity with no material near-term debt maturities.

Crescent Point currently expects to allocate approximately $50 million of proceeds from this disposition for additional share repurchases subsequent to closing and subject to market conditions. Given the anticipated timing for closing of the sale of the Assets in first quarter 2020, the Company’s 2019 budget continues to assume a total of approximately $125 million of share repurchases. Crescent Point continues to be active in achieving this 2019 target and has repurchased, for cancellation, approximately 16.3 million shares year-to-date 2019 for total consideration of approximately $83 million, up to and including November 13, 2019.

Crescent Point is a leading North American light oil producer, driven to enhance shareholder returns by cost-effectively developing a focused asset base in a responsible and sustainable manner.

All financial figures are approximate and in Canadian dollars unless otherwise noted. This press release contains forward-looking information and references to non-GAAP financial measures. Significant related assumptions and risk factors, and reconciliations are described under the Non-GAAP Financial Measures and the Forward-Looking Statements and Other Matters sections of this press release, respectively.

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