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Sasol, a South African technology -driven, alternative fuels and chemicals company, today announced it signed a second agreement with Canadian -based Talisman Energy to acquire a 50% stake in their Cypress A shale gas asset located in the Montney basin of British Columbia.
Consistent with the recent Farrell Creek shale gas acquisition, announced in December 2010, this second acquisition will see Talisman Energy retain the remaining 50% interest and continue to operate the Cypress A gas asset. “Talisman is a world -class shale gas operator and we are delighted to be further cementing our relationship with them,” said Sasol chief executive, Pat Davies. Assets included in the transaction cover over 57,000 acres of land and represent an estimated contingent resource of 11.2 trillion cubic feet (TCF). “This transaction allows Talisman and Sasol to unlock additional value in the world -class Montney shale play and potentially accelerate development of the resources in the area,” said John A. Manzoni, President & CEO of Talisman. “The Cypress A assets are very similar to Farrell Creek and, with our partner, we will now build an integrated long -term development plan for the area.” The Cypress A asset offers particularly thick productive shale formations and is located in close proximity to the recently acquired Farrell Creek asset. This will allow for optimisation and synergies. The existing and planned pipeline infrastructure in North America also allows for gas to either be sold into the regional gas market, or to a potential integrated Gas -to -Liquids (GTL) facility in Canada. These attributes make the asset attractive both on a stand -alone basis as well as in combination with the Farrell Creek assets. As disclosed in December 2010, in the Farrell Creek announcement, Sasol and Talisman have agreed to conduct a feasibility study on the economic viability of a facility in western Canada to convert natural gas to liquid fuels using Sasol 's GTL technology. The acquisition of the Cypress A asset, together with the Farrell Creek acquisition, will allow us to scale up such a GTL facility. “Sasol 's has over 60 years ' experience in providing alternative fuels technology solutions. It is our technology that differentiates us in our sector and that provides us with superior growth opportunities such as this one. We are optimistic regarding the outcome of the GTL feasibility study,” said Davies. The transaction is conditional upon the exchange control approvals required by the South African Reserve Bank and other regulatory approvals required. Sasol expects the transaction to close within the third quarter of the 2011 calendar year. |
