Vermilion strengthens Canada’s Deep Basin position with $745 million Westbrick deal

(Reuters) – Canada’s Vermilion Energy said on Monday it will acquire privately held oil and gas company Westbrick Energy for C$1.075 billion ($746.53 million), primarily in cash, strengthening its position in the Deep Basin of Alberta.

U.S.-listed shares rose 1.8% to $9.03 in premarket trading.

The acquisition is likely to add 50,000 barrels of oil equivalent per day, consisting of 75% gas and 25% liquids, to existing production.

Calgary, Alberta-based Vermilion said it represents 5% year-over-year production growth and is expected to generate more than C$110 million in annual free cash flow.

Last year, Tourmaline Oil, Vermilion’s peer and largest Deep Basin producer, bought rival Bonavista Energy for C$1.45 billion, adding 600,000 boepd to its production capacity.

The oil and gas company said the acquisition, which is expected to close in the first quarter of 2025, will make it the fifth-largest producer in the basin.

Certain shareholders of Westbrick, representing more than 90% of the company’s outstanding shares, have already passed a written resolution approving the arrangement, it said.

($1 = 1.4400 Canadian dollars)

(Reporting by Tanay Dhumal in Bengaluru; Editing by Savio D’Souza and Krishna Chandra Eluri)