The agreement is still subject to approval by Celtic Exploration’s shareholders as well as the Canadian regulatory authorities.
Currently, production of the acreage that will be acquired includes 72 million cubic feet per per day of natural gas, along with 4,000 barrels per day of crude, condensate and natural gas liquids.
Such assets were estimated to include approximately 128 million oil equivalent barrels of proved and probable reserves, 24 per cent of which are crude, condensate and natural gas liquids, while 76 per cent natural gas.
Andrew Barry, president of ExxonMobil Canada says the purchase will add great value to his company.
“This acquisition will add significant liquid-rich resources to our exisitng North American unconventional portfolio. Our financial and technical strength will enable us to maximize resource value by leveraging the experience of ExxonMobil subsidiary XTO Energy, a leading U.S. oil and natural gas producer which has expertise in developing tight gas, shale oil and gas and coal bed methane.”
Close to 60 employees of Celtic Exploration will have the opportunity to transition to ExxonMobil employment.
Shareholders of Celtic Exploration will receive $24.50 Canadan per share, as well as half a share of a newly established company which will hold assets not included in the agreement with ExxonMobil Canada.
Such assets include acreage in the Inga area of B.C., Alberta’s Grande Cache area and oil and gas properties of interest located in Karr, Alberta.
Currently, ExxonMobil’s Canada affiliate, Imperial Oil Limited, is not included in the transaction, but could decide to participate at a later time through its current agreement with ExxonMobil Canda, which provides up to equal participation in new Canadian upstream opportunities.