Logan Energy Corp. (TSXV: LGN) has made a significant strategic move in the Canadian energy sector with the announcement of a major asset acquisition, substantial equity financing, and expanded credit facilities. The company revealed these developments in a comprehensive press release that outlines its growth strategy for the coming years.
Strategic Montney Asset Acquisition
Logan Energy has entered into a definitive purchase agreement to acquire strategic assets in the Montney formation for cash consideration of $62.5 million. The acquisition involves assets predominantly located in the company's core area at Simonette, Alberta, with an effective date of January 1, 2026, and expected closing around March 10, 2026, subject to customary closing conditions.
This transaction represents a strategic consolidation for Logan Energy, building upon their previous acquisition of a 50% operated working interest in certain Simonette assets from the same vendor in December 2024. The new acquisition will bring Logan's ownership to 100% working interest in these Montney-focused lands while also including incremental Deep Basin lands in the Bilbo and Leland areas of Alberta that offset the Simonette region.
Acquisition Highlights and Metrics
The acquired assets include current production of approximately 1,400 barrels of oil equivalent per day (BOE/d), with 59% of that production being liquids. The transaction encompasses 24.5 net sections of highly prospective Montney acreage containing 40 net identified Montney drilling locations at a cost of approximately $0.6 million per location.
Key financial metrics of the acquisition include:
- Consideration of $62.5 million represents approximately 2.2 times the 2026 estimated operating income
- The acquisition will increase Logan's reserve values across categories by 15% to 19%
- Annualized funds flow per share accretion exceeds 5% in 2026 and 10% in 2027
- The financing structure is approximately leverage neutral relative to Logan's pre-acquisition 2026 budget
The acquired assets feature top-tier Alberta Montney oil inventory, with South Simonette Lower Montney oil wells demonstrating strong performance metrics. Additional development opportunities exist in Cretaceous Deep Basin horizons with 10.2 net identified undeveloped locations.
Concurrent Equity Offerings and Credit Expansion
In conjunction with the asset acquisition, Logan Energy has announced concurrent bought deal equity financings for aggregate gross proceeds of $50.0 million. The company has entered into an agreement with a syndicate of underwriters co-led by National Bank Capital Markets and TD Securities Inc.
The equity offerings will consist of 68,494,000 common shares at a price of $0.73 per share, divided equally between a public offering (34,247,000 shares) and a private placement (34,247,000 shares).
Additionally, Logan Energy has secured an expansion of its revolving credit facilities to $250.0 million, providing the company with enhanced financial flexibility to execute its growth strategy.
Strategic Implications and Future Outlook
This comprehensive transaction package positions Logan Energy for significant growth in the Montney formation, one of North America's most prolific hydrocarbon resource plays. The acquisition is described as highly accretive on all key metrics both immediately and in the long term, significantly enhancing Logan's long-term organic growth plan.
The company's pro forma guidance for 2026 reflects the strategic benefits of this transaction, with increased reserve values and enhanced per-share metrics. The consolidation of working interests to 100% provides Logan with greater operational control and strategic flexibility in developing these assets.
This announcement comes at a time when the Canadian energy sector continues to evolve, with companies seeking to optimize their asset portfolios and strengthen their financial positions. Logan Energy's strategic moves demonstrate a focused approach to growth in core areas while maintaining financial discipline through balanced financing structures.
The transaction represents a significant step forward for Logan Energy as it builds its presence in the Montney formation and positions itself for sustainable growth in the Canadian energy landscape.
