ExxonMobil to Buy Canada's Celtic Exploration

ExxonMobil to Buy Canada's Celtic Exploration

ExxonMobil Corp. agreed Wednesday to buy Canadian oil and gas producer Celtic Exploration Ltd. in a deal worth about 3.1 billion Canadian dollars ($3.14 billion), including debt.

Calgary, Alberta-based Celtic said Exxon Mobil's Canadian unit is offering C$24.50 a share for its outstanding shares, plus 0.5 of a share of a new company, representing a 35% premium to Celtic's closing price of C$18.12 in Toronto Tuesday.

Based on Celtic's outstanding 105.7 million shares, the offer has a cash value of about C$2.59 billion.

"This acquisition will add significant liquids-rich resources to our existing North American unconventional portfolio," Andrew Barry, president of Exxon Mobil Canada, said in a statement.

Exxon Mobil's buy, which includes current production of 72 million cubic feet a day of natural gas and 4,000 barrels a day of crude, condensate and natural gas liquids, comes at a time when foreign companies are looking to bolster their presence in resource-rich Canada.

The Celtic assets being acquired include 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. Celtic is focused on exploration, development and production of crude oil and natural gas resources primarily in west central Alberta.

The deal, which includes a C$90 million break-up fee payable under certain circumstances by Celtic, is subject to Celtic shareholder approval and approval by Canadian regulators.


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