Calgary-based Vermilion Energy Inc. has gained 120 square miles of natural gas-rich Montney Shale drilling rights with a C$477 million ($382 million) takeover of Leucrotta Exploration Inc. The acquired property package in northern Alberta and British Columbia was announced Monday.
Vermilion said the Leucrotta deal would enable more than doubling current combined natural gas and liquids production to 13,000 boe/d.
The exploration and production company, with Dutch, Irish and Western Canadian production, expects the Leucrotta assets to have “plateau production” of 28,000 boe/d “over the next few years…
“We have conservatively identified 275 multi-zone, extended reach drilling prospects to date, representing an expected two decades or more of low-risk, self-funding, high deliverability drilling inventory.”
Leucrotta personnel and investors that own 41% of shares support the corporate combination. The deal includes creating a Vermilion affiliate with access to the Montney assets that would be run and part-owned by Leucrotta staff.
Provided the deal closes on schedule in May, Vermilion said a C$75 million ($60 million) start would be made this year on the planned drilling campaign.
Leucrotta is Vermilion’s second acquisition this year.
The firm grew its European gas output in January by raising its ownership in Corrib, an Irish offshore field, to 56.5% with a C$556 million ($445 million) asset purchase from Equinor ASA.
Combined 2022 Canadian and international production is forecast to average 86,000-88,000 boe/d.
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