Imperial Oil is splashing out $1.55 billion to buy into ExxonMobil’s acquisition of fellow Canadian player Celtic Exploration, giving it a slice of the action in a pair of shale plays.
Calgary-based Imperial struck a deal on Wednesday to gain a 50% stake of the company on completion of an earlier transaction whereby the US supermajor has agreed to buy Celtic outright for about C$2.6 billion ($2.64 billion).ExxonMobil
itself owns 69.6% of Imperial.
The pair will gain access to 545,000 net acres in the liquids-rich Montney shale, 104,000 net acres in the Duvernay shale and additional acreage in other areas of Alberta to be acquired in the Celtic takeover.
The acreage is estimated by Celtic to hold proven and probable reserves of 128 million barrels of oil equivalent, of which 76% is natural gas and 24% condensate and natural gas liquids.
The company is currently producing 72 million cubic feet per day of gas and 4000 barrels per day of condensate and natural gas liquids.
"This acquisition will allow Imperial to diversify its strong resource base in Canada with an attractive liquids-rich natural gas play" said chief executive Bruce March, adding the company would also be able to leverage ExxonMobil’s expertise in shale gas development.
The deal to acquire Calgary-based Celtic remains subject to approval by its shareholders and Canadian authorities.