Canada’s Vermilion Energy in Deep Basin acquisition
Calgary-based producer Vermilion Energy, active in Canada, Europe and Australia, said December 23 it had entered into an agreement to acquire privately-held Deep Basin producer Westbrick Energy for C$1.075bn (US$749mn) in cash and shares.
“The strategic acquisition of Westbrick represents a significant step forward in Vermilion’s North American high-grading initiative to increase operational scale and enhance full-cycle margins in the liquids-rich Deep Basin,” Vermilion CEO Dion Hatcher said. “The Deep Basin is an area Vermilion has been operating in for nearly three decades and is currently the largest producing asset in the company.”
The acquisition, expected to close in Q1 2025, will add about 770,000 net acres of land contiguous to Vermilion’s legacy Deep Basin assets, four operated natural gas plants with about 102mn ft3/day of capacity and stable annual production in 2025 estimated at 50,000 barrels of oil equivalent (boe)/day (75% natural gas).
After the acquisition, Vermilion will become the fifth largest Deep Basin producer, with more than 1.1mn net acres of land and production of more than 75,000 boe/day. Globally, its production will average about 135,000 boe/day, with 80% coming from its global natural gas operations, comprised of 550mn ft3/day-equivalent of liquids-rich gas in Alberta and BC and more than 100mn ft3/day-equivalent of European gas with direct exposure to premium LNG pricing.