UK's Harbour Energy enters Gulf of Mexico with $3.2 billion LLOG deal

Dec 22 (Reuters) - North Sea-focused Harbour Energy HBR.L said on Monday it would buy deepwater oil and gas exploration and production company LLOG Exploration for $3.2 billion, marking its entry into the U.S. Gulf of Mexico.

The deal will consist of $2.7 billion in cash and $500 million in Harbour's voting ordinary shares, the company said in a statement.

The Gulf of Mexico remains a prime target for oil majors such as BP BP.L, Shell SHEL.L and Chevron CVX.N because of its vast deepwater reserves, easy access to U.S. infrastructure and long-term production potential.

Its appeal has been boosted by President Donald Trump's administration's promotion of oil and gas exploration over investment in renewable energy.

Earlier this month, LLOG was one of the winners at the U.S. government's first sale of oil and gas drilling rights in the Gulf of Mexico since 2023.

The deal will help Harbour's overall production reach about 500,000 barrels of oil equivalent per day by the end of the decade, and be accretive to free cash flow from 2027, the company said.

On completion, LLOG's parent firm, LLOG Holdings LLC, will own 11% of Harbour's listed voting ordinary shares, with current shareholders holding the remaining 89%, it added.