VET - Vermilion Energy to buy Equinor Energy Ireland in $434M deal

Vermilion Energy (NYSE:VET) +3.4% pre-market after agreeing to acquire Equinor's (NYSE:EQNR) 36.5% equity position in the Corrib gas project in Ireland for $434M. The deal will raise Vermilion's operated interest in Corrib to 56.5%, significantly increasing its exposure to premium priced European natural gas. As part of the deal terms, the two companies will hedge ~70% of the production for 2022-23, which provides high certainty of an approximate two-year payback period. Vermilion says the Corrib acquisition will add 23M boe of 2P reserves and produce 7,700 boe/day in 2022. Based on forward commodity prices, Vermilion forecasts Corrib will generate $365M of funds from operations and $361M of free cash flow in 2022. Vermilion recently reported a Q3 GAAP loss while announcing plans to reinstate a quarterly dividend in Q1 2022.

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Vermilion Energy to buy Equinor Energy Ireland in $434M deal