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Canada’s Enerplus Corp said it would buy some assets in North Dakota’s Williston Basin from Hess Corp for $312 million, as improved oil price expectations have buoyed mergers and acquisitions in North America.

Canada’s oil and gas sector had a record start to 2021 in terms of mergers and acquisitions as the energy sector benefits from a rebound in oil prices from the pandemic-led crash last year, and as smaller companies bet on economies of scale.

Enerplus said it will buy 78,700 net acres in North Dakota, adjacent to its current core Bakken acreage, with about 6,000 barrels of oil equivalent per day (boepd) of working interest production from Hess.

The acquisition of largely undeveloped land has expanded Enerplus’ drilling inventory in the play by two to three years, Scotiabank analysts wrote in a note, adding its five-year plan to grow production modestly and emphasize free cash flow will likely be well received by investors.

The deal, expected to close in May, will add to Enerplus’ adjusted free cash flow per share and net asset value in the first year, Enerplus said.

The company raised its output guidance for the year to between 111,000 and 115,000 boepd, from 103,500 to 108,500 boepd, due to the acquisition as well as strong operating performance in North Dakota and higher-than-expected production in Pennsylvania’s Marcellus region.

It also raised its 2021 spending plans to $360 million to $400 million from $335 million to $385 million.

For Hess, the sale of the acreage, which it was not planning to drill before 2026, strengthens its cash and liquidity position. Last month, the company agreed to sell stakes in the two Danish oilfields to chemicals and energy group INEOS for $150 million.