Tamarack Valley Energy (TVE.TO) has agreed to sell its Charlie Lake assets for $804.0 million in cash and announced a 25% dividend increase, according to a Wednesday news release.
Net proceeds from the divestiture will initially be used to eliminate Tamarack's net debt.
Tamarack also plans to invest an additional $75 million in Clearwater in the second half of the year to accelerate primary and secondary development activities, representing a 10% increase to full-year capital investment guidance. Tamarack's 2026 capital investment program is now expected to be $430 million to $450 million.
Capital deployment is expected to result in 15% production growth within Clearwater properties compared to the previous year.
At deal closing, Tamarack will become a pure play Clearwater producer with a net cash position of C$125 million and $1.3 billion of available funding.
In connection with the transaction, Tamarack announced a 25% increase to its quarterly dividend to $0.05 per share, or $0.20 per share on an annualized basis, up from $0.04 per share. The increased dividend will commence in the third quarter.
The transaction has an effective date of April 1 and is expected to close near the end of the second quarter, subject to customary closing conditions and regulatory approvals.
Shares in TVK fell 4.5% yesterday amid losses for the broader market.