Ovintiv to acquire Logan Energy in Montney move

Denver-based Ovintiv (NYSE: OVV) announced this week that it had struck a deal to acquire all of the outstanding shares of Canada’s Logan Energy (TSXV: LGN). The all-cash transaction, which will see Ovintiv pay CAD1.40 ($1.00) per Logan share in cash, values Logan at roughly CAD1.26bn ($890mn) including expected net debt.

The transaction will expand Ovintiv’s footprint in Canada’s Montney play. The company said the acquisition would add around 420 total net 10,000-foot (3,048 metres) equivalent oil well locations. It will also add roughly 266,000 net acres (1,076 square km) or about 200,000 core acres (809 square km), of which around 80% is undeveloped, in the Montney oil window.

The assets currently produce roughly 20,000 barrels of oil equivalent per day (boepd), consisting of around 7,000 barrels per day (bpd) of oil and condensate, 70mn cubic feet (2.0mn cubic metres) and 1,000 bpd of other natural gas liquids (NGLs). The assets are located in “close proximity” to Ovintiv’s existing Montney operations, according to the announcement, and include two new oil batteries and additional gas-processing capacity.

Ovintiv said the transaction would be funded through a combination of cash on hand, borrowings under its credit facility and its commercial paper programme. The acquisition is anticipated to close in the first quarter of 2027.

"This bolt-on transaction delivers value for our shareholders by adding high margin oil and condensate production and infrastructure, utilising our operational advantage to drive significant synergies, and adding to our already deep drilling inventory and future growth optionality," stated Ovintiv’s president and CEO, Brendan McCracken. "The Logan assets have demonstrated leading oil productivity performance and will immediately compete for capital alongside the rest of our portfolio."

In its own announcement, Logan said that as part of the transaction, it would launch a new company, Logan Oil, which would be spun out to Logan shareholders as a wholly owned subsidiary. That company will focus on heavy oil production and has already agreed to acquire Andora Energy, which owns the Sawn Lake steam-assisted gravity drainage (SAGD) project in Alberta. Logan Oil has also entered into a pre-acquisition agreement with Woodcote. Additionally, Logan Oil will have certain undeveloped assets in Alberta transferred to it by its parent company prior to the acquisition by Ovintiv.

This is the latest in a series of Montney acquisitions for Ovintiv, which was formerly known as Encana and focused on Canada before rebranding and pursuing opportunities in the US. Now, the company is reviving its interest in Canada. Its recent Montney-focused acquisitions include its takeover of NuVista Energy earlier this year and the purchase of assets in the play from Paramount Resources in 2025.

This comes against the backdrop of a broader boom in M&A activity in Canada. The Financial Post reported this week that by the end of September, oil and gas producers had announced over CAD30bn ($21bn) in M&A. According to the newspaper, analysts expect 2026 to top the record of CAD53bn ($38bn) set in 2017.