Bellatrix pays $118 million to increase holdings in Alder Flats core area

CALGARY – Bellatrix Exploration Ltd. (TSX:BXE) has bought a group of oil and gas assets in its core Alder Flats area in west central Alberta for $118 million.

The company said Monday the deal increases its stake in the Mannville formation to 96.9 per cent from 39.6 per cent over 10 gross sections of land.

The acquisition adds about the equivalent of about 2,200 barrels per day of production, with 80 per cent of that in the form of natural gas and 20 per cent in liquids.

Bellatrix said it bought the assets from a senior oil and gas producer, which wasn’t identified.

It expects to spend $16 million next year on the assets, to about double their output to 4,500 barrels per day in 2015.

The company also raised its production guidance for this year and next.

It now expects to finish 2014 with production in the range of 47,000 and 49,000 boe/d, about 2,000 barrels than it had earlier forecast.

The company also increased its projected 2015 average production range by 1,000 barrels to between 49,000 and 50,000 boe/d.

However, Bellatrix says its 2015 net capital spending budget will be reduced to $400 million from $450 million in light of recent commodity price changes.

Note to readers: This is a corrected story. An earlier version incorrectly stated the increase in company’s stake in the Mannville formation.