UPDATE 2-Imperial Oil to pay C$1.55 bln for half of Celtic

Wed Nov 28, 2012 12:08pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

* Imperial to take 50 pct of Exxon's Celtic buy

* Brings stake in liquids-rich Montney and Duvernay shales

* May help assure government approvals

* Shares edge higher

CALGARY, Alberta, Nov 28 (Reuters) - Imperial Oil Ltd , Canada's second-largest integrated oil company, said on Wednesday it will pay C$1.55 billion ($1.56 billion) for a 50 percent stake in Celtic Exploration Ltd after the unconventional oil and gas producer is taken over by Exxon Mobil Corp.

Exxon Mobil, which owns 69.6 percent of Imperial, said in October that it would buy Celtic for C$2.6 billion to gain its promising shale oil and gas properties in British Columbia and Alberta. Imperial has the right to acquire 50 percent of any new Canadian business launched by its majority owner.

"This acquisition will allow Imperial to diversify its strong resource base in Canada with an attractive liquids-rich natural gas play," Chief Executive Bruce March said in a statement.

Analysts said the deal may help speed Canadian approvals for Exxon's acquisition, though approval may still be delayed while the government decides whether to allow two larger mergers; the $15.1 billion acquisition of Nexen Inc by China's CNOOC Ltd and the C$5.2 billion bid for Progress Energy Resources Corp by Petronas, Malaysia's state oil company.

"We believe this provides additional confidence that the deal will receive Investment Canada approval as (Imperial) has operated in Canada since 1899," Andrew Potter, an analyst at CIBC World Markets, said in a research note.   Continued...