Harbour Energy, UK, enters Gulf of Mexico LLOG market with $3.2 billion deal

Harbour Energy, a North Sea-focused company, announced on Monday that it will purchase deepwater oil exploration and production firm LLOG Exploration at a price of $3.2 billion. This marks its entry into the U.S. Gulf of Mexico.

In a press release, Harbour said that the deal would consist of $2.7 billion in cash and $500 millions in Harbour's ordinary voting shares.

Gulf of Mexico is a top target for oil'majors like BP, Shell, and Chevron due to its vast deepwater resources,?easy accessibility to U.S. Infrastructure, and long-term potential.

The appeal of the project has been enhanced by the promotion of oil exploration and gas investment over renewable energy by President Donald Trump’s administration.

LLOG, one of the winners of the first U.S. Government sale of oil drilling rights in the Gulf of Mexico after 2023 was announced earlier this month.

Harbour said that the deal would help the company's overall production to reach 500,000 barrels per day of oil equivalent by the end of the decade and will be a positive factor in free cash flow starting 2027.

It added that, upon completion, LLOG Holdings LLC's parent company,?LLOG Holdings LLC will own 11% Harbour's listed voting normal shares, with the current shareholders holding 89% of them. (Reporting and editing by Subhranshu sahu, Emelia Sithole Matarise and Ankita Bora from Bengaluru)

(source: Reuters)