Major Oilpatch Merger Signals Strategic Shift
In a move that underscores two powerful trends reshaping Canada's energy landscape, Ovintiv Inc. has announced a $3.8-billion acquisition of mid-sized producer NuVista Energy Ltd. This deal, finalized in November 2025, represents a significant strategic pivot for the company and continues the rapid consolidation wave sweeping through the intermediate tier of Canadian oil and gas companies.
Ovintiv's Repositioning and the Hollowing Mid-Cap
The transaction highlights Ovintiv's deliberate shift in focus. The Denver-based company, formerly known as Encana and once headquartered in Calgary before moving to the U.S. in 2020, is selling off assets in the United States to concentrate on two core continental areas: the Permian Basin in Texas and the Montney formation in Western Canada.
Michael Tims, vice-chair of Matco Investments, interpreted the move as a clear “repositioning of the portfolio to put a higher weight on Canada.”
Concurrently, the deal exemplifies the ongoing erosion of mid-sized players in the Canadian energy sector. Eric Nuttall, a senior portfolio manager with Ninepoint Partners and a major NuVista shareholder, called it “yet another example of the mid-cap space being hollowed out,” as buyers from both Canada and the U.S. seek to expand their foothold in premium plays like the Montney and Duvernay formations.
Deal Details and a Return to Roots
Under the friendly agreement announced on Tuesday, Ovintiv offered approximately $18 per share in a combination of cash and stock for NuVista.
For Ovintiv CEO Brendan McCracken, the acquisition is something of a homecoming. “I was around when we drilled some of the first (Montney) horizontal wells in 2006,” McCracken recalled in an interview. He emphasized the strategic value, stating, “The top two oil basins in North America are the Permian in west Texas and Montney in Alberta and British Columbia. They’re the largest remaining undeveloped premium resource in North America.”
NuVista, established in 2003, has grown into a significant player in the condensate-rich Montney. The company was producing about 74,000 barrels of oil equivalent per day in the second quarter and had anticipated reaching 100,000 boe per day by the fourth quarter. According to a company release, NuVista initiated a strategic review in August to evaluate alternatives to its standalone plan, which led to this agreement with Ovintiv.
