Ovintiv in $4.3bn deal to acquire Permian assets
Denver-based producer Ovintiv said April 3 it had entered into a $4.275bn cash and share deal to acquire 65,000 net acres in the Midland basin of the Permian from portfolio companies managed by EnCap Investments.
EnCap will receive 32.6mn Ovintiv shares and $3.125bn of cash, with the cash portion to be partially funded through Ovintiv’s parallel $825mn sale of its Bakken assets in North Dakota to another EnCap portfolio company.
|
Advertisement: The National Gas Company of Trinidad and Tobago Limited (NGC) NGC’s HSSE strategy is reflective and supportive of the organisational vision to become a leader in the global energy business. |
Expected to close by the end of Q2 2023, the acquisition will increase Ovintiv’s Permian production to 190,000 barrels of oil equivalent (boe)/day from 115,000 boe/day and increase the oil share of its production portfolio there to 65% from 55%. Bakken production associated with the sale to EnCap is estimated at about 37,000 boe/day, 60% of which is oil and condensate.
“We are acquiring a unique undeveloped asset in the Northern Midland Basin,” Ovintiv CEO Brendan McCracken said. “Located in some of the best rock in the Permian, these assets have demonstrated leading well performance and are a natural fit with our existing Martin County acreage.”