Harbour Energy has finalized a $3.2 billion deal to acquire US-based LLOG Exploration Company LLC, granting the company presence in deepwater projects in the US Gulf of America.
Harbour will pay for the acquisition through $2.7 billion in cash and $ 500 million worth of its Harbour voting ordinary shares. The cash component of the deal will be funded through a $1 billion bridge facility,a $1 billion term loan, in addition to existing liquidity.
As for the voting shares component, it will see LLOG Holdings acquiring about 11% of Harbour’s listed voting shares on completion, according to a Harbour Energy press release
The transaction is designed to lift production, extend reserves life, improve margins, and support higher free cash flow and shareholder returns later this decade.
Harbour stated that the deal provides entry into the deepwater US Gulf of America, adding an oil-weighted portfolio of assets producing approximately 34,000 barrels of oil equivalent per day (kboe/d). These assets carry operating costs of $12 per barrel of oil equivalent and a blended federal and state tax rate of around 23%.
Key-operated assets include Who Dat in Mississippi Canyon and Buckskin and Leon-Castile in Keathley Canyon, contributing to a 2P (proved plus probable) reserves life of 22 years and expected production growth of roughly double current levels by 2028, underpinned by a leading position in the Lower Tertiary Wilcox play.
Harbour noted that LLOG’s asset base adds 271 million barrels of oil equivalent (mmboe) of 2P reserves, increasing the group’s 2P reserves by about 22% and lifting overall 2P reserves life from seven to eight years.
The portfolio is expected to support Harbour’s total production at around 500 kboe/d through the end of the decade, increase the company’s oil weighting and Organisation for Economic Co-operation and Development (OECD) exposure, and lower its effective tax rate, while offering a deep inventory of short-cycle, infrastructure‑led drilling opportunities, including up to eight wells across 2026 and 2027.
Following completion, LLOG will operate as Harbour’s new Gulf of America business unit and retain the LLOG name to capitalize on its nearly five‑decade track record in the basin, led by CEO Philip LeJeune.
Harbour added that the highly experienced LLOG team will support its offshore Mexico developments, with the combined business expected to operate more than 80 leases, mainly in Mississippi Canyon and Keathley Canyon, and to secure 11 deepwater leases from a recent federal lease sale.
Harbour Energy, a London-listed independent oil and gas producer, operates core assets in Norway, the UK, Argentina, and Mexico, with a focus on high-quality offshore fields and material free cash flow generation. The company has pursued aggressive growth through strategic acquisitions, including the recent agreement to buy the UK’s Waldorf assets and divest non-core Indonesian holdings to optimize its portfolio.
LLOG Exploration, a privately held operator founded nearly 50 years ago, has built a strong reputation in the US Gulf of America deepwater. This deal marks Harbour’s first major entry into the prolific US Gulf, complementing its OECD-focused strategy.
