Greenfire to acquire Canadian oil sands producer Connacher for $900m

Greenfire Resources has agreed to get Canada-based Connacher Oil and Gas successful an all-cash transaction valued astatine astir C$1.27bn ($900.4m).

Connacher operates arsenic a privately owned thermal lipid sands shaper focused connected the accumulation and merchantability of bitumen. It has 100% ownership of the Great Divide lipid sands task successful Alberta, Canada.

Greenfire, which is listed connected some the New York Stock Exchange and the Toronto Stock Exchange, is an lipid sands shaper with operations successful Alberta. The institution has 2 steam-assisted gravity drainage lipid accumulation facilities, Hangingstone Expansion and Hangingstone Demo.

The institution stated that accumulation from Great Divide is projected to mean astir 19,500 barrels per time (bpd) successful 2026, with a steam-oil ratio of astir 3.0. The tract holds estimated proved positive probable (2P) reserves of astir 441 cardinal barrels (mbbl), which corresponds to a 62-year reserve beingness index.

The Great Divide task is straight adjacent to Greenfire's Hangingstone assets adjacent Fort McMurray, which is expected to enactment operational efficiencies.

Greenfire has identified imaginable yearly synergies of astir C$30m, to beryllium realised by the extremity of 2026. The institution expects to execute these done savings crossed midstream, marketing, operational costs, and wide and administrative expenses.

It stated that these synergies correspond astir 19% of Connacher's stand-alone sustaining escaped currency travel astatine a benchmark West Texas Intermediate terms of $70.

Upon completion of the acquisition, Greenfire expects combined 2026 accumulation to scope astir 34,000bpd. 2P reserves are expected to full 850mbbl, starring to a reserves beingness scale of astir 68 years.

The semipermanent program involves expanding output to astir 65,000bpd.

The transaction remains taxable to customary closing conditions and indispensable approvals, with Greenfire anticipating completion successful August 2026.

The acquisition is expected to beryllium financed by a gully of astir C$700m connected a C$1bn reserves-based loan, accrued from C$275m.

Additionally, a C$575m span installation volition beryllium successful place, which the institution plans to repay utilizing proceeds from an anticipated rights offering of Greenfire communal shares.

To enactment the rights offering, Waterous Energy Fund has pledged a standby committedness of astatine slightest C$575m.

Greenfire has appointed BMO Capital Markets and National Bank Capital Markets arsenic fiscal advisers, with Blake, Cassels & Graydon and Scale arsenic ineligible counsel. For Connacher, the fiscal advisor is TPH&Co, portion the ineligible advisor is Norton Rose Fulbright Canada.

"Greenfire to get Canadian lipid sands shaper Connacher for $900m" was primitively created and published by Offshore Technology, a GlobalData owned brand.