Canadian oil and gas producer Baytex Energy Corp. (NYSE: BTE) said June 18 it would buy rival Raging River Exploration Inc. for about C$2.8 billion (US$2.13 billion) to expand in the oil-rich Duvernay Field in Alberta.

Canadian oil producers and global majors have made a beeline for the Duvernay and Montney formations, known for their light oil, which is easier to refine and cheaper to produce than northern Alberta's oil sands crude.

Seven Generations Energy Ltd. and Encana Corp. (NYSE: ECA) are among leading Canadian producers operating in the two regions, while Chevron Corp. (NYSE: CVX) announced its first Canadian shale development in the Duvernay in November.

The combined company, which will be led by Baytex CEO Edward LaFehr, expects to produce 100,000 to 105,000 barrels of oil equivalent per day in 2019 and forecast capex of between C$750 million and C$850 million for the same period.

Raging River shareholders will get 1.36 shares of Baytex for each share held, according to the deal, which is expected to close in August.

Baytex's offer represents a 10.4% premium to Raging River's June 15 close, according to Reuters calculations. (US$1 = C$1.3162)