Alongside an $85 million acquisition, Gear Energy Ltd. (TO: GXE.TO) has an increased development capex budget, the company said April 25.
The company’s board of directors approved an increase, and the 2014 development capex budget is now $85 million, up from $70 million, Gear Energy added.
The monies will support the acquired heavy oil assets in Wildmere, Alberta and Maidstone, Saskatchewan, the company noted.
The assets include more than 2,000 barrels of oil equivalent per day (boe/d), 98% of it oil, the company said.
The acquisition is scheduled to close May 1, Gear Energy said. It will be funded with existing lines of credit and existing cash flow, the company added.
Total corporate production is estimated at 7,000 boe/d, and there are 175 net drilling locations already identified in the assets, the company said.
The total drilling inventory will now total about 400 locations, Gear Energy added, noting that drilling inventory will be greater than five years.
Calgary, Alberta-based Gear Energy Ltd. produces oil in Alberta and Saskatchewan.
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