Canada approves ExxonMobil's $3.1-bn Celtic Exploration deal

The Canadian government yesterday approved the $3.1-billion acquisition of Celtic Exploration by Exxon Mobil Corp, four months after it was announced.

In October 2012, ExxonMobil's Canadian subsidiary, ExxonMobil Canada, agreed to buy Canadian oil and gas company Celtic Exploration Ltd, in a deal valued at about $3.1 billion (See: ExxonMobil to acquire Canadian oil and gas company Celtic Exploration for $3.1 billion).

Calgary-based Celtic Exploration said in a statement that the deal requires no further regulatory approvals as the minister of industry approved the transaction under the terms of the Investment Canada Act.

One of the main requirements of the Investment Canada Act is for the government to determine whether an overseas acquisition of a Canadian company, especially by a state-owned company, would be of net benefit to the country.

Under this provision, the Canadian government had recently approved the controversial $15.1-billion takeover of energy company Nexen Inc, by China's state enterprise CNOOC.

The Celtic Exploration deal will give the Houston-based ExxonMobil  545,000 net acres in the liquids-rich Montney shale, 104,000 net acres in the Duvernay shale and additional acreage in other areas of Alberta.

Current production of the acreage to be acquired is 72 million cubic feet per day of natural gas and 4,000 barrels per day of crude, condensate and natural gas liquids.