Cenovus Energy is to buy rival Canadian oil producer Husky Energy, controlled by Hong Kong billionaire Li Ka-shing, in a C$10.2bn ($7.8bn) deal as the wave of consolidation sweeping North America’s battered oil and gas sector gathers speed.
The new company will be worth C$23.6bn, Cenovus said, making it Canada’s third-largest oil and gas producer with an output of 750,000 barrels a day concentrated in the bitumen-rich oil sands of northern Alberta, the biggest single source of US crude imports.
The transaction is the latest in a string of North American oil mergers as operators seek to consolidate and cut costs. The largest came last week when ConocoPhillips agreed to buy Concho Resources in a deal worth $9.7bn, marking another big bet on the future of US shale.