Ovintiv Inc. (NYSE: OVV) announced a major portfolio transformation on Tuesday, unveiling an agreement to acquire Canadian producer NuVista Energy Ltd. for approximately $2.7 billion (C$3.8 billion) while simultaneously preparing to divest its Anadarko assets in 2026. The twin moves signal a renewed strategic focus on high-return oil and gas production in North America’s Montney region.
Under the deal, Ovintiv will purchase all outstanding NuVista shares not already owned, paying C$18.00 per share in a mix of 50% cash and 50% stock. Ovintiv previously acquired a 9.6% stake in NuVista in a private transaction at C$16 per share. Upon completion, NuVista shareholders will own about 10.6% of the combined company.
The acquisition adds roughly 140,000 net acres—70% of which remain undeveloped—and 100,000 barrels of oil equivalent per day (MBOE/d) of production in Alberta’s oil-rich Montney play. The deal also expands Ovintiv’s drilling inventory by 930 potential well locations, including 620 “premium” sites with projected internal rates of return above 35% at $55 oil.
“This transaction boosts our free cash flow per share by acquiring top-decile rate-of-return assets in the heart of the Montney oil window,” said Brendan McCracken, Ovintiv’s President and CEO. “The NuVista assets were identified as among the highest-value undeveloped oil resources in North America, offering exceptional fit with our existing operations and infrastructure.”
The transaction will also give Ovintiv access to NuVista’s extensive processing and transportation capacity, including 600 MMcf/d of processing rights and 250 MMcf/d of long-term firm transport to markets outside of AECO. This diversification is expected to reduce Ovintiv’s exposure to AECO natural gas pricing from 30% to 25% by 2026.
Financially, the deal is expected to be immediately accretive across all major performance metrics, including free cash flow, return on capital, and earnings per share. Ovintiv anticipates roughly $100 million in annual cost synergies, primarily through reduced capital and operating costs. The company also emphasized that its balance sheet will remain strong, projecting leverage-neutral outcomes at closing and reaffirming its investment-grade credit profile.
To finance the transaction, Ovintiv plans to use a combination of cash on hand, credit facility borrowings, and a potential term loan. The company has temporarily paused its share buyback program for two quarters to prioritize funding but will maintain its base dividend.
Looking ahead, Ovintiv plans to begin the divestiture of its Anadarko Basin assets in early 2026, with proceeds earmarked for debt reduction. The company expects to reduce net debt below $4 billion by year-end 2026, paving the way for increased share repurchases and enhanced shareholder returns.
By consolidating its position in one of North America’s most productive basins while shedding lower-margin assets, Ovintiv is signaling a clear commitment to efficiency and long-term value creation. Once the transaction closes—expected by the end of Q1 2026 pending shareholder and regulatory approvals—Ovintiv’s Montney production will rise to 400,000 barrels of oil equivalent per day, reinforcing its role as one of the leading integrated energy producers in the region.