The assets sold generated $149m (C$208.37m) in operating earnings in 2024, which was 12% of Strathcona’s total operating earnings for that year. Credit: T. Schneider/Shutterstock.

Strathcona Resources has entered into definitive agreements for the sale of its assets in Montney, Canada, for approximately C$2.84bn.

The transactions include the sale of the Kakwa, Grande Prairie and Groundbirch assets to ARC Resources and Tourmaline Oil.

The Kakwa sale to ARC Resources is valued at C$1.69bn, comprising C$1.65bn in cash and roughly C$45m in assumed lease obligations.

The Grande Prairie sale to Tourmaline Oil is expected to fetch approximately C$850m, with C$750m in cash and around C$100m in assumed lease obligations.

Tourmaline Oil will also acquire the Groundbirch asset for C$291.5m in common shares of Tourmaline.

The combined sale value is around 33% of Strathcona’s current enterprise value.

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Collectively, the assets sold generated C$149m in operating earnings in 2024, which was 12% of Strathcona’s total operating earnings for that year, excluding interest and other corporate items.

The assets had a year-end 2024 proved PV-10 before-tax value of approximately C$2.3bn, representing 15% of Strathcona’s total proved PV-10 for the same period.

The Kakwa and Grande Prairie sales are expected to close early in the third quarter of 2025 (Q3 2025), while the Groundbirch sale is anticipated in Q2.

All transactions are subject to regulatory approvals and customary closing conditions.

Post-divestment, Strathcona will focus on being a pure-play heavy oil producer with an output of approximately 120 million barrels per day (mbbl/d) and a 50-year 2P reserve life index.

The company’s projected production for Q2 2025 is 180 million barrels of oil equivalent per day (mboe/d), which includes the impact of a major turnaround at Tucker.

Full-year production for 2025 is expected to average between 150mboe/d and 160mboe/d.

The improved full-year production forecast reflects a 5mbbl/d increase over the original 2025 guidance, adjusted for the Montney divestment, driven by performance at Cold Lake.

Capital expenditures for the full year are estimated at C$1.2bn, reduced from the previous C$1.35bn forecast due to the removal of Montney capital in the latter half of 2025.