North Sea operator i3 Energy has agreed to acquire Canada-based Toscana Energy. The latter company, in turn, owns Firenze Energy, which operates the company’s 13 fields onshore Canada.

Toscana’s reserves lie in Saskatchewan and Alberta lying in the Western Canadian Sedimentary Basin. The fields hold assets equal to 4.65m barrels of oil equivalent (boe). Toscana has stakes in 255 wells and last year pumped these at an average rate of 1,065 boe per day.

Its average breakeven price is $21.74 per boe, a low figure which will help i3 battle the current low oil price. The purchased reserves hold 53% oil and 47% gas.

In a statement, i3 said it was purchasing Toscana “at a fraction of going market-based valuations”. After Toscana defaulted on its debt, i3 bought its debt facility for roughly $2.4m, 72% of i3’s net field payback.

The statement said i3 aimed to use the purchase to diversify its portfolio. It says: “We have concluded that the WCSB provides a unique, time-limited opportunity to build a portfolio of production assets on superior metrics not achievable elsewhere.”

It points to a “short to medium term lack of infrastructure” in transporting Canadian hydrocarbons as a problem for Toscana. With this, i3 says the growth of US shale gas has caused problems for companies which otherwise have “excellent, long-life, low-decline production assets”.

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i3 Energy CEO Mafid Shafiq said: “In addition to diversifying our portfolio, this transaction will help to stabilise our business with a steady revenue stream while adding considerable upside potential from within Toscana’s Clearwater acreage – an opportunity which is comparable to the growth potential of our Serenity discovery. We look forward to welcoming the Toscana management team and staff to i3 and working together to grow our business in the UK and Canada.”