Fairborne Energy to sell oil assets for $80M to reduce debt

Canada’s Fairborne Energy Ltd. said it will sell its oil assets in the Greater Sinclair area in Manitoba and Saskatchewan to a private oil and gas company for $80 million to reduce debt.

The company, which did not name the buyer, said the sale of these assets would reduce its net debt by 31 per cent.

Fairborne, with operations in Alberta, Saskatchewan and Manitoba, had a debt of $261.1 million at the end of 2011. Last year, it had sold some of its natural gas assets to repay debt.

The company’s assets in southwest Manitoba and southeast Saskatchewan include proved reserves of 1.6 million barrels of oil and accounts for about 700 barrels per day of oil production.

Shares of Fairborne closed at $1.84 on Friday on the Toronto Stock Exchange.