Greenfire Resources and M3-Brigade to Combine in $950 Million Deal
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Greenfire Resources Inc. and M3-Brigade Acquisition III Corp. (MSBC) have entered into a definitive agreement for a business combination that values Greenfire at $950 million. The closing of the business combination is expected to occur in Q2 2023 and upon closing Greenfire Resources Ltd. (GRL) will become the parent of both Greenfire and MSBC.
Greenfire Resources is a Calgary-based energy company focused on the sustainable production and development of thermal energy resources from the Athabasca region of Alberta, Canada. M3-Brigade Acquisition III Corp. is a special purpose acquisition company.
Greenfire Resources Ltd. (GRL) is a newly created corporation incorporated under the laws of the province of Alberta to participate in the business combination. Following completion of the business combination, GRL is expected to continue to be managed by Greenfire’s current executive team. The combined company will remain focused on optimizing Greenfire’s existing production and facilities.
GREENFIRE’S ASSETS AND STRATEGY
Greenfire currently has two producing oil sands assets, Hangingstone Expansion and Hangingstone Demo, with current net consolidated production of approximately 22,000 barrels per day (bbls/d) of bitumen. Greenfire owns a 75 percent working interest in Hangingstone Expansion, which is a steam assisted gravity drainage (SAGD) bitumen production facility with current gross production of approximately 24,000 bbls/d, located 50 kilometers to the southwest of Fort McMurray, Alberta, Canada. Greenfire also owns a 100 percent working interest in Hangingstone Demo, which is a SAGD bitumen production facility with current production of approximately 4,000 bbls/d, located five kilometers to the northwest of Hangingstone Expansion. The Hangingstone expansion and Hangingstone demo facilities both produce from the same tier one SAGD reservoir in the McMurray Formation.
Greenfire plans to sustainably increase production at Hangingstone expansion and Hangingstone demo by optimizing each site’s existing surface infrastructure and operating conditions, while employing a safe, efficient, and capital-disciplined operating approach. Greenfire’s current capital plans include projects designed to debottleneck the Hangingstone expansion facility to a gross capacity of 35,000 bbls/d and the Hangingstone demo facility to a capacity of 7,500 bbls/d. Greenfire expects that these surface facility debottlenecking plans, combined with the implementation of industry proven well optimization techniques to maximize production per well from its tier one reservoir, could lead to a material increase in production and profitability, as well as a step change reduction in the carbon intensity per produced barrel of bitumen across both facilities.
“Greenfire has successfully assembled some of the highest quality oil sands assets in the industry and solidified our position as a leading intermediate oil sands developer. Supporting the safe, responsible, and efficient development of our world-class assets is an incredible team of dedicated and talented people,” said Robert Logan, president and chief executive officer of Greenfire.
“The investment by MBSC is a strong vote of confidence in our plan to deliver profitable growth as we focus on maximizing shareholder and stakeholder value,” added Logan.
“We are excited to partner with the Greenfire team to support their growth and success,” said Mohsin Y. Meghji, executive chairman of MBSC.
“The Greenfire team has meaningful experience managing Canadian oil sands assets and we are excited to be able to provide MBSC investors with the opportunity to invest in Greenfire at this valuation,” added Meghji.
“Greenfire’s producing fields have strong growth prospects as the company is debottlenecking its operations and increasing production by a meaningful amount. The need for continued oil production in the United States and Canada is clear and we expect that Greenfire’s proven reserves and track record for success will create long-term growth opportunities for the company,” said Matthew Perkal, chief executive officer of MBSC.
About Greenfire Resources
Greenfire is currently an intermediate sized and low-cost oil sands producer focused on responsible energy development in Canada, with its registered office located in Calgary, Alberta. Greenfire remains an operationally focused company with an emphasis on an entrepreneurial environment and employee ownership. Greenfire continues to see a range of attractive investment opportunities in the oil and gas sector in Canada.
To stop by Greenfire’s website, CLICK HERE
About M3-Brigade Acquisition III Corp.
M3-Brigade Acquisition III Corp. is a special purpose acquisition company organized by the founders and senior executives of M3 Partners, LP and Brigade Capital Management, LP for the purpose of effecting a merger, stock purchase or similar business combination with one or more businesses.
To stop by M3-Brigade’s website, CLICK HERE
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