Exxon to buy Canada's Celtic Exploration for $2.64 billion

(Reuters) - Exxon Mobil Corp struck a deal to acquire Canadian oil and gas company Celtic Exploration Ltd for C$2.6 billion ($2.64 billion), aiming to grow its output and expand its asset base in western Canada.

The deal, announced Wednesday, will give the world's largest publicly traded energy company vast tracts in the liquids-rich Montney shale in the province of British Columbia, along with holdings in the Duvernay shale and other areas in the province of Alberta.

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

Exxon and other global oil majors are buying more oil and gas assets in North America as they struggle to boost output in a sector where vast energy resources are located in and tightly controlled by countries like Brazil and Russia. Last month Exxon agreed to acquire Denbury Resources Inc's properties in the Bakken shale for $1.6 billion.

Exxon said its Canadian subsidiary, ExxonMobil Canada, would pay C$24.50 for each share of Celtic, a 35 percent premium to Celtic's closing price on the Toronto Stock Exchange on Tuesday. For each common share tendered, Celtic shareholders will also receive half a share in a new company led by Celtic's current management team.

The new company will house a gas property at Grand Cache, Alberta; a liquids-rich natural gas property at Inga, British Columbia; and an oil prospect at Karr, Alberta. Celtic said the net asset value per share of the new company is estimated to be about C$2.32, based on an independent engineering evaluation.

Exxon's bid is the latest in a wave of foreign takeovers in the energy rich provinces of Alberta and British Columbia in Western Canada, where the bulk of Celtic's assets are located.

The Canadian government is currently reviewing Chinese state-owned oil major CNOOC Ltd's C$15.1 billion bid for Nexen Inc, and Malaysian state oil company Petronas' C$5.2 billion bid for Progress Energy Resources Corp.

Including payments for Celtic's convertible debentures, and Celtic's bank debt and working capital obligations, the deal is valued at C$3.1 billion, Celtic said in a statement.

The deal has been unanimously approved by Celtic's board of directors.

(Reporting by Euan Rocha in Toronto; Editing by Lisa Von Ahn and John Wallace)

Source: http://news.yahoo.com/exxon-mobil-buy-canadas-celtic-exploration-112131963--finance.html

read across america vikings stadium breitbart dead db cooper fafsa branson missouri davy jones dead