UPGRADE 1-Penn West sells Saskatchewan assets for $975 mln to Teine Energy

<articleLocation” > Canadian energy producer Penn West Petroleum Ltd (PWT.TO) (PWE.N) said on Friday it would offer its Viking light oil possessions for $975 million to Teine Energy, which is backed by the Canada Pension Plan Investment Board. Penn West, which has come under financial pressure in recent weeks over its large financial obligation concern, will also offer some of its assets in Alberta for about $140 million. The Calgary-based business stated the cash gotten from the sale of its assets would decrease its pro forma net debt to about $600 million. It had C$ 1.86 billion ($ 1.46 billion) in debt as of March 31. Last month, Penn West stated it might default on its financial obligation at the end of the 2nd quarter, as a depression in oil rates over the past 2 years have actually hurt highly leveraged business.

Reuters reported today that Penn West had actually received a minimum of 4 quotes from companies for its Viking light oil assets, including Teine Energy. Teine Energy said the offer would be moneyed by the Canada Pension Plan Investment Board and its existing credit centers, according to a statement.

The Canada Pension Plan Financial investment Board owns 77 percent of Teine Energy, a Saskatchewan-focused energy producer, and has actually been an investor given that 2010.

J.P. Morgan Securities acted as Teine’s financial consultant to Teine, while RBC Capital Markets encouraged Penn West. (Reporting by Narottam Medhora in Bengaluru; Modifying by Diane Craft and David Gregorio).

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