KEY TAKEAWAYS: Harbour Energy agreed to acquire LLOG Exploration for $3.2 billion Deal marks Harbour’s entry into the deepwater U.S. Gulf of America LLOG assets add long-life, oil-weighted production and operational control Transaction expected to be free cash flow accretive starting in 2027   London-headquartered Harbour Energy has agreed to acquire Covington-based LLOG Exploration Company LLC for $3.2 billion, marking the company’s strategic entry into the deepwater U.S. Gulf of America and significantly expanding its global offshore portfolio. The transaction, announced December 22, includes $2.7 billion in cash and $500 million in Harbour voting ordinary shares. LLOG is being acquired from LLOG Holdings LLC, with the deal expected to close in late first quarter 2026, subject to regulatory approvals, including U.S. antitrust review. Gerald “Jerry” Boelte founded LLOG in 1977. The acquisition establishes Harbour as a major deepwater operator in the Gulf of America, adding oil-weighted offshore assets with long reserve life and significant operational control. Harbour said the deal will increase production, improve margins and support free cash flow growth, with the transaction expected to be free cash flow per share accretive starting in 2027. Chief Executive Linda Z. Cook said the deal fulfills Harbour’s long-standing goal of establishing a presence in the Gulf of America, citing the region’s infrastructure, regulatory framework and growth potential. She said LLOG’s assets and workforce represent a strong strategic and cultural fit and will form the foundation of Harbour’s new Gulf of America business unit, which will retain the LLOG name. LLOG operates a portfolio of deepwater assets in the Mississippi Canyon and Keathley Canyon areas, including the Who Dat, Buckskin and Leon-Castile fields. Production currently totals about 34,000 barrels of oil equivalent per day, with operating costs of roughly $12 per barrel of oil equivalent. Harbour said the assets have a 2P reserves life of about 22 years and could support a doubling of production by 2028 as additional projects come online. Harbour Chief Financial Officer Alexander Krane said the acquisition strengthens the company’s long-term financial position by extending reserve life, boosting cash flow and supporting its investment-grade credit profile. He said the deal follows Harbour’s recent agreement to acquire Waldorf Production in the U.K. and divest assets in Indonesia, moves aimed at improving portfolio quality and cash generation. LLOG Chief Executive Philip LeJeune said the company’s combination with Harbour creates new opportunities for growth while maintaining its long-standing operational and ethical standards. LLOG has operated in the Gulf of America for nearly five decades and is widely regarded as one of the region’s leading independent offshore operators. Under the deal structure, Harbour will finance the cash portion through a $1 billion bridge facility, a $1 billion term loan and existing liquidity. LLOG Holdings will receive approximately 175 million newly issued Harbour shares, representing about 11% of Harbour’s voting stock after completion, subject to adjustments tied to Harbour’s ongoing share buyback program. Harbour said its board unanimously supports the acquisition, describing it as in the best interests of shareholders. J.P. Morgan Cazenove served as financial adviser to Harbour, while Guggenheim Securities advised LLOG on the deal. ...read more read less