Canadian oil producer Whitecap Resources Inc. said Aug. 31 it would buy NAL Resources Ltd., owned by Manulife Financial Corp, for CA$155 million (US$118.59 million) as it looks to boost its core Alberta and Saskatchewan assets.
Whitecap said it would issue 58.3 million of its shares to Manulife in exchange for all the issued and outstanding shares of NAL, which operates in Canada's Saskatchewan and Alberta.
Insurance and financial services provider Manulife will own about 12.5% of the combined company.
The deal marks growing interest in mergers among smaller Canadian oil producers to bolster their portfolios, as uncertainty about future oil demand persists.
The COVID-19 pandemic destroyed fuel demand and left dozens of energy companies without the prospect of drilling their way out of debt or bankrupt, making consolidations a viable solution for many smaller players.
Separately on Aug. 31, Calgary, Alberta-based oil and gas company Obsidian Energy Ltd. offered two shares for every share of Bonterra Energy Corp.
That would value Bonterra at about C$35 million, or C$1.06 per share, a 29.3% discount to its close on Aug. 28. Bonterra shareholders would own about 48% in the combined company, Obsidian said.
Last month, top independent U.S. oil producer ConocoPhillips Co. said it would buy land from Kelt Exploration Ltd. in Canada's Montney shale oil play in a $375 million deal. (US$1 = $1.3070 Canadian dollars)
Recommended Reading
E&P BW Energy Undergoes ‘Technical’ Ownership Restructuring
2024-05-08 - The restructuring will not involve any change to the ultimate control of BW Energy as the shares currently held by BW Group will be sold to BW Energy Holdings.
Hess Midstream Subsidiary Plans Private Offering of Senior Notes
2024-05-08 - The proposed issuance is not expected to have a meaningful impact on Hess Midstream’s leverage and credit profile, according to Fitch Ratings.
Exxon Appoints Maria Jelescu Dreyfus to Board
2024-05-08 - Dreyfus is CEO and founder of Ardinall Investment Management, a sustainable investment firm, and currently serves on the board of Cadiz Inc. and Canada-based pension fund CDPQ.
OFS Sector Loses Jobs, but Trade Org Says Growth Potential Remains
2024-05-08 - According to analysis by the Energy Workforce & Technology Council, the OFS job market may still have potential for growth despite a slight decrease in the sector in April.
Dividends Declared in the Week of May 6
2024-05-10 - Here is a selection of upstream, midstream and service and supply companies’ dividends declared in the past week.