Canadian oil and gas company Zargon Oil & Gas Ltd. (TSX:ZAR)(TSX:ZAR.DB) said that last month it has initiated a process for the potential sale of the company and has retained Scotia Waterous Inc. as its exclusive financial advisor.

Scotia Waterous, the oil and gas arm of Scotiabank (TSX: BNS)(NYSE: BNS), is a global leader in oil and gas M&A.

Zargon is joining a long list of energy companies seeking strategic alternatives to deal with a prolonged slump in oil prices.

Zargon Oil & Gas Ltd. is a Calgary, Alberta-based oil and natural gas company working in the Western Canadian and Williston sedimentary basins and is focused on oil exploitation projects (waterfloods and tertiary ASP) that profitably increase oil production and recovery factors from existing oil reservoirs.

Zargon’s assets consist of low-decline, operated oil production with significant oil exploitation opportunities.

As of March 4, 2016, Zargon had a market capitalization of $19 million, and a net debt of $121 million.

Over its 20 year history Zargon says it has returned $367 million ($18.12 per common share) through distributions and dividends to its shareholders on a total equity investment of $210 million.

Alberta Plains North
Zargon is pursuing high-graded oil exploitation opportunities in Alberta Plains North. The Killam and Bellshill Lake oil properties provide a large inventory of long-life oil exploitation projects. This core area also holds most of the company’s legacy natural gas assets which are being harvested as efficiently as possible.

Alberta Plains South
Zargon’s Alberta Plains South activities are focused on secondary oil recovery projects (waterfloods) and tertiary opportunities (chemical-based floods). Zargon’s tertiary Alkaline Surfactant Polymer (“ASP”) project at Little Bow provides for substantial oil production growth for many years.

Williston Basin
Zargon’s largest oil producing core area, the oil-rich Williston Basin is where the majority of its oil exploitation drilling has taken place. The company drills horizontal wells into existing Mississippian reservoirs which in many cases are supported by long-life operating waterfloods.

Reserves
Based on an independent reserves evaluation conducted by the engineering firm of McDaniel & Associates Consultants Ltd. effective December 31, 2015, Zargon had proved and probable reserves of 20.90 million barrels of oil equivalent. Reserve additions from exploration and development activities (including revisions) and corporate and net property acquisitions were 0.28 million barrels of oil equivalent.

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