Freehold Royalties paying $165 million for Husky oil and gas royalty assets

CALGARY – Freehold Royalties Ltd. is buying a portfolio of oil and gas royalty assets from Husky Energy Inc. for $165 million.

The deal will see Freehold gain the equivalent of about 1,700 barrels of oil production and add $11.6 million to annual operating income.

The company says it will also increase its total royalty land holdings by 74 per cent to 2.39 million hectares with the addition of properties in southern Saskatchewan and Alberta’s Deep Basin.

Freehold says it will pay for the deal through a $165-million equity financing plus a $20-million private placement.

The Freehold announcement comes a week after Husky said it was selling 65 per cent of its midstream assets near Lloydminster, Alta., for $1.7 billion.

Oil and gas companies have been looking to sell off assets to strengthen balance sheets as low oil prices hit profits.