Calgary-based Whitecap Resources Inc. and Veren Inc. will join forces to become the seventh-largest Canadian oil company and a leading light oil and condensate producer by production in the Montney and Duvernay shale regions.
The $15 billion all-share deal, inclusive of net debt, has received shareholder approval from both companies. While 99.8 percent of Veren shareholders were in favour of the deal, 88.7 percent of Whitecap investors were on board. As outlined in the deal, Veren shareholders will receive 1.05 common shares of Whitecap for each common Veren share.
The company will operate under the Whitecap name and management. It is expected to save more than $200 million in operational efficiencies once amalgamated. As part of those efficiencies, some employees will lose their jobs.
Craig Bryksa, Veren’s President & CEO, stated, “This strategic combination unlocks significant value for all shareholders and together positions us as a stronger, more resilient company. With enhanced scale, deep inventory, and increased free funds flow generation, we’re building a business with a differentiated competitive advantage. Our combined balance sheet reinforces our financial strength and enhanced credit profile, ensuring the long-term success in an evolving market. Together we’re unlocking synergies, creating new opportunities, and setting the stage for sustainable growth.”
Whitecap will become the biggest landholder in the Montney and Duvernay shale regions in western Alberta and the second-largest producer in Saskatchewan, with a total daily production of 370,000 barrels. The combined company was stress-tested and can withstand a $50 US West Texas Intermediate crude price through 2026.
Grant Fagerheim, Whitecap’s President & CEO, stated, “We are excited to bring together two exceptionally strong asset bases to create one world-class energy producer with one of the deepest inventory growth sets of both liquids-rich Montney and Duvernay opportunities, along with conventional light oil opportunities in some of the most profitable plays in the Western Canadian basin. Our combined company will include exceptional technical and support personnel from the two companies in both the office and field and an experienced Board of Directors that prioritizes sustainable and profitable growth to generate strong returns for our combined shareholders. We look forward to bringing Whitecap and Veren together and providing increased value to both sets of shareholders well into the future.”
