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Energy Stock News - Saturn Oil & Gas Inc. (TSXV: SOIL) Announces Closing of the Acquisition of Ridgeback Resources Inc.

 

Calgary, Alberta - March 1, 2023 (Newsfile Corp.) (Investorideas.com Newswire) Saturn Oil & Gas Inc. (TSXV: SOIL) (FSE: SMKA) (OTCQX: OILSF) ("Saturn" or the "Company") is pleased to announce that further to its press releases of January 20, 2023, it has successfully completed the previously announced acquisition of Ridgeback Resources Inc. (the "Ridgeback Acquisition"), a privately held oil and gas producer focused on light oil production in Saskatchewan and Alberta, for a transaction value of approximately $516 million1.

The Ridgeback Acquisition adds:

"With the closing of the Ridgeback Acquisition, Saturn has diversified its light oil focused production base with a deep and sustainable portfolio of development opportunities," said John Jeffrey, CEO of Saturn. "We now have a total inventory of over 940 (gross) booked drilling locations to sustain Saturn's production for over a decade."

Consideration for the Ridgeback Acquisition was comprised of $475 million in cash, and the issuance of 19,406,167 common shares in the capital of the Company ("Common Shares")1. The cash portion of the purchase price was funded through the net proceeds of Saturn's previously announced $125 million bought deal equity financing (the "Financing"), and proceeds from an amended and restated credit agreement with the Company's existing lender which increased the Company's borrowing capacity and provided additional proceeds of $375 million. The Financing was completed by way of a prospectus supplement to the Company's base shelf prospectus and was underwritten by Echelon Capital Markets, as sole bookrunner and co-lead, Canaccord Genuity Corp., as co-lead, and with syndicate underwriters including Eight Capital, Beacon Securities Limited and Paradigm Capital Inc. The Company received strategic lead orders from GMT Capital Corp., Libra Advisors, LLC and other institutional investors, and will seek to appoint up to two new members to the Board of Directors to expand its technical and operational expertise.

In accordance with their terms, each subscription receipt of the Company issued pursuant to the Financing was exchanged for one Common Share concurrently with the completion of the Ridgeback Acquisition, and the net proceeds of approximately $117 million were released from escrow to fund a portion of the purchase price of the Ridgeback Acquisition. Holders of subscription receipts are not required to take any action in order to receive the underlying Common Shares, and the subscription receipts are expected to be de-listed from trading on the TSX Venture Exchange as of the close of business on March 1, 2023.

(1) $516 million at a deemed price of $2.11 per Common Share, or $525 million using the 5-day volume weighted average price of the Common Shares prior to the announcement of the Ridgeback Acquisition, being $2.5765.

Ridgeback Acquisition Overview

The Ridgeback Acquisition bolsters Saturn's existing Oxbow Asset light oil production in Southeast Saskatchewan with synergistic assets that include approximately 5,000 boe/d of high cash flow netback production, increasing Saturn's production in the area by over 65%. The Ridgeback Acquisition more than doubles the light oil production of Saturn's existing and adjoining core growth asset in Southeast Saskatchewan.

With the completion of the Ridgeback Acquisition, approximately 40% of Saturn's production will be in Alberta, offering play diversification of highly economic, light oil focused drilling. Each of the Alberta areas have high working interests: Cardium (68%), Deer Mountain (100%) and Kaybob (100%) and have extensive operated infrastructure in place to drive low operating costs and realize high cash netbacks. The Acquisition offers a new core area for the Company with an entry into the Alberta Cardium play, one of North America's largest and most economic oil pools, with over 300 de-risked development drilling locations and approximately 8,700 boe/d of light oil focused production. The assets acquired from Ridgeback benefit from responsibly deployed capital directed to abandonment and reclamation programs with limited inactive liabilities and a strong Liability Management Rating ("LMR") of over 3x.

Advisors

Echelon Capital Markets and Canaccord Genuity Corp. acted as financial advisors to Saturn. CIBC Capital Markets and TD Securities Inc. acted as financial advisors to Ridgeback. Dentons Canada LLP acted as legal counsel to Saturn with respect to the Ridgeback Acquisition, the Financing, and the increased loan facility. Blake, Cassels & Graydon LLP acted as legal counsel to Ridgeback. DLA Piper (Canada) LLP acted as legal advisor to the Underwriters.

About Saturn Oil & Gas Inc.

Saturn Oil & Gas Inc. is a growing Canadian energy company focused on generating positive shareholder returns through the continued responsible development of high-quality, light oil weighted assets, supported by an acquisition strategy that targets highly accretive, complementary opportunities. Saturn has an ESG-focused culture, Saturn's goal is to increase reserves, production and cash flows at an attractive return on invested capital. Saturn's shares are listed for trading on the TSX.V under ticker 'SOIL' on the Frankfurt Stock Exchange under symbol 'SMKA' and on the OTCQX under the ticker 'OILSF'.

Further information and a corporate presentation is available on Saturn's website at www.saturnoil.com.

Saturn Oil & Gas Investor & Media Contacts:

John Jeffrey, MBA - Chief Executive Officer
Tel: +1 (587) 392-7902
www.saturnoil.com

Kevin Smith, MBA - VP Corporate Development
Tel: +1 (587) 392-7900
info@saturnoil.com

Reader Advisory

This press release is not an offer of the securities for sale in the United States. The securities offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act") or any U.S. state securities laws and may not be offered or sold in the United States absent registration or an available exemption from the registration requirement of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities, in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Boe Disclosure

The term barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet per barrel (6 Mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All boe conversions in the report are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.

FORWARD-LOOKING INFORMATION AND STATEMENTS.

Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project", "scheduled", "will" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to, (i) timing for the de-listing of the subscription receipts, and (ii) information concerning Saturn's expected production and operating results.

The forward-looking statements contained in this press release are based on certain key expectations and assumptions made by Saturn. Although Saturn believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Saturn can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks.

The forward-looking information contained in this press release is made as of the date hereof and Saturn undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward-looking information contained in this press release is expressly qualified by this cautionary statement.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES

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