Assets
High quality and free cash flow margin assets.
We seek assets that are sustainable, aligned, large scale, low cost and high quality.
Topaz is principally exposed to high-quality, long-life, lower emission natural gas royalty assets, backed by an investment grade Canadian natural gas producer. Topaz currently owns gross overriding royalty (GORR) interests on approximately 5.3 million acres of land located throughout the most prolific natural gas plays in the Western Canadian Sedimentary Basin (WCSB) strategically situated for future LNG takeaway.
Topaz has GORR interests on over 380 thousand acres of land strategically located in the Clearwater area in Alberta, which is a rapidly emerging oil play with appealing environmental characteristics including decreased land usage from multi-well, multi-leg pad development and reduced sand and freshwater usage as no hydraulic fracture stimulation is required.
Topaz owns non-operated interests in natural gas processing facilities which service prominent WCSB natural gas resource plays in addition to pipeline connected water disposal and storage infrastructure which services the Alberta Montney play. All of the Company's energy infrastructure assets are underpinned by long-term, fixed fee commitments.
Operational Areas
Topaz’s assets are strategically located throughout Canada's premium resource plays – the NEBC Montney, the Alberta Deep Basin, Central Alberta, the Peace River High area of BC/Alberta, Alberta Clearwater, Southeast Saskatchewan (including Weyburn) and Manitoba. Topaz is the only natural gas focused royalty company and Canadian natural gas has the lowest emissions in the world.
Topaz has significant royalty scale in Canada’s premium gas plays strategically situated for future LNG takeaway. Topaz has the largest Montney and Deep Basin royalty positions and an expanding Clearwater oil royalty position.
Topaz's growth strategy is focused on economically resilient resources in the main growth corridor of the WCSB well situated for future LNG; with a secondary focus on other long-life, economically resilient plays.
The Montney, known for its vast geographic coverage and significant reserve potential, has become the most prolific natural gas resource in Western Canada and gas well performance continues to increase at a faster rate than other Canadian natural gas production. In the Montney, horizontal multi-stage fracture stimulation wells have allowed access to the thickest, highest pressured and highest deliverability fine grained sandstone reservoirs.
The Deep Basin is Canada's largest natural gas complex known for its multi-objective, tight natural gas sand play area with up to fifteen separate lower Cretaceous liquids-rich natural-gas-charged sand reservoirs. Tourmaline's target exploration and production area is in that portion of the Deep Basin where the entire lower Cretaceous stratigraphic section is gas saturated with no mobile formation water. The use of multi-stage fracture stimulation in both horizontal and vertical well-bores and seismic data interpretation have allowed Tourmaline to consistently deliver a significant portion of the highest productivity gas wells in the province with amongst the lowest completed well costs on an annual basis.
Topaz has significantly expanded its royalty interest ownership in the Clearwater area in Alberta, which ranks amongst the strongest and fastest growing oil plays in the WCSB and is characterized by appealing economic and environmental characteristics including low well costs, high quality large OOIP resource, moderate initial decline profiles, competitive netbacks, decreased land usage with the use of multi-leg drilling, and minimal water and no sand requirements as the completion operations do not require fracture stimulation. The total recoverable resource in the Clearwater continues to expand with success from exploration drilling and the play is well suited for waterflood or enhanced oil recovery projects.
Topaz is the largest royalty holder in the Charlie Lake light oil play which ranks amongst the most economic light oil plays in North America; is situated in an active development area with well-established production and egress infrastructure and is considered to be economically resilient to crude oil prices as low as US$30 WTI.
The resource plays spanning East to West Central Alberta include medium to heavy oil development in the Provost/Lloydminster areas near the Alberta/Saskatchewan border and gas-weighted production further west in Central Alberta. These plays are active development areas with well-established production and egress infrastructure.
Weyburn provides low decline, reliable free cash flow generating conventional oil assets under carbon dioxide (CO2) enhanced oil recovery. It includes over 50,000 gross acres of developed and undeveloped land in a conventional, unitized oil field under CO2 enhanced recovery in Saskatchewan. This is an internationally recognized CO2 sequestration operation resulting in “net negative” carbon emissions and is economically resilient to crude oil prices as low as US$35 WTI.
Southeast Saskatchewan is well known as being prospective for light to medium oil in the Mississippian Madison and Three Forks Groups (Midale, Frobisher, Bakken/Torquay and other targeted geological formations). The area is well delineated with several in-fill and step out horizontal drilling opportunities, and the area has well developed infrastructure. Well costs typically range between $1MM and $2MM and provide <1 year payouts.
Assets Overview
The royalty assets provide the Company with high margin free cash flow as the Company is entitled to receive a royalty on gross production revenue. Topaz does not incur the related operating, finding and development, maintenance and other capital costs, environmental liabilities or reclamation obligations typically associated with petroleum and natural gas development.
Topaz's GORR interests are well poised for growth and provide exposure to commodity price upside. Topaz owns GORR interests on over five million gross acres of royalty lands in the Western Canadian Sedimentary Basin; focused in the most prolific natural gas plays (NEBC Montney & Alberta Deep Basin), and amongst the most economic conventional oil plays (Clearwater, Peace River High and low (3%) decline conventional oil under CO2 enhanced recovery at Weyburn). Topaz owns GORR interests on approximately 100% of Tourmaline's acreage. Tourmaline has a proven track record and the scale/cost profile for self-funded growth which enables Topaz to provide a transparent future outlook.
Topaz owns fee mineral title acreage focused in Central Alberta, Southeast Saskatchewan and Manitoba. As an owner of fee mineral title acres, Topaz owns the underlying sub-surface mineral rights in perpetuity as well as at no additional cost. Topaz can grant mineral leases to third party operators in exchange for bonus consideration and a lessor royalty.
Topaz's infrastructure assets are situated in the best parts of the WCSB. They were built strategically by producers within their development areas. Topaz is not exposed to long lead times or construction risk, and doesn’t carry the administrative burden associated with operatorship. Topaz lets the producer do what they do best; drill wells and operate their facilities.
Investing in lower emissions hydrocarbons through the use of carbon capture and storage helps accelerate our ESG performance. Carbon (CO2) is captured or separated from gases at an industrial facility. CO2 is compressed for transportation in a pipeline. CO2 can then be injected via a well in to a suitable geological formation for storage or sequestration. The formation is monitored over time to ensure CO2 is contained. Topaz is investing in both infrastructure and royalty assets with underlying CCS opportunities.