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SEVEN GENERATIONS AND ARC RESOURCES COMBINATION

Creating a leading responsible developer of Canadian energy

On February 10, 2021, we announced that Seven Generations has entered into an agreement to combine with ARC Resources and form Canada’s premier Montney Producer. The combined company will continue to focus on significant free funds flow1 generation through a responsible and disciplined approach to development while creating superior and enduring value for all shareholders.

The combination is consistent with ARC’s and Seven Generations’ long-term strategies and is expected to be immediately accretive on a free funds flow and net asset value per share basis to all shareholders.

The companies have entered into a definitive agreement to combine in an all-share transaction valued at approximately $8.1 billion, inclusive of net debt. The combined company will operate as ARC Resources Ltd. and remain headquartered in Calgary, Alberta. Under the terms of the definitive agreement, Seven Generations shareholders will receive 1.108 common shares of ARC for each common share of Seven Generations held.

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TRANSACTION HIGHLIGHTS

1 Non-GAAP measure that does not have any standardized meaning under International Financial Reporting Standards ("IFRS") and therefore may not be comparable to similar measures presented by other entities. Free funds flow is computed as funds from operations generated during the period less capital expenditures before undeveloped land purchases and property acquisitions and dispositions.

2 ARC and Seven Generations have adopted the standard six thousand cubic feet ("Mcf") to one barrel ("bbl") of crude oil ratio when converting natural gas to barrels of oil equivalent ("boe"). Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different than the energy equivalency of the 6:1 conversion ratio, utilizing the 6:1 conversion ratio may be misleading as an indication of value.

3 Throughout this news release, crude oil ("crude oil") refers to light, medium, and heavy crude oil product types as defined by National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). Condensate is a natural gas liquid as defined by NI 51-101. Throughout this news release, NGLs comprise all natural gas liquids as defined by NI 51-101 other than condensate, which is disclosed separately. Throughout this news release, crude oil and liquids ("crude oil and liquids") refers to crude oil, condensate, and NGLs.


UPDATES

The companies will held a joint conference call and webcast to discuss the transaction on February 10, 2021 at 6:00 p.m. MST.


ADVISORIES

Please refer to the advisory statements in the news release.

Emergency Number

403-444-1471

7G

Contact Us

info@7genergy.com

Corporate Headquarters
Calgary, AB

Operations Headquarters
Grande Prairie, AB

Key Contacts