ExxonMobil’s Canadian affiliates, namely Imperial Oil and ExxonMobil Canada, have agreed to sell their Montney and Duvernay shale oil and gas assets in Canada to Whitecap Resources in an all-cash deal worth $1.47bn.
Imperial and ExxonMobil Canada hold these assets through their joint venture XTO Energy Canada.
As per the deal, Whitecap will acquire 567,000 net acres in the Montney shale, 72,000 net acres in the Duvernay shale, and additional acreage in other areas of Alberta.
These assets have a net production of approximately 140 million cubic feet of natural gas per day, and produce nearly 9,000bpd of crude, condensate, and natural gas liquids.
The sale forms part of the firms’ efforts to capitalise on surging global crude oil and gas prices.
It also complies with ExxonMobil’s plan to offload smaller oil and gas assets to reduce its debt and focus on upstream resources.
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Imperial said in a statement: “The sale completes the marketing effort announced in January 2022, and is consistent with Imperial’s strategy to focus upstream resources on key oil sands assets and its commitment to deliver long-term value to shareholders.”
Planned to be closed before the end of the third quarter of 2022, the transaction is subject to customary closing conditions, including the receipt of necessary regulatory approvals.
Whitecap Resources anticipates the acquisition to significantly improve the free funds flow profile of the Montney asset.
It also marks Whitecap’s entry into the liquids-rich Duvernay play at Kaybob.