Harbour Energy announced it has agreed to acquire privately held LLOG Exploration Company LLC for $3.2 billion, marking Harbour’s strategic entry into the deepwater U.S. Gulf of America and adding a new core operating region alongside its existing positions in Norway, the UK, Argentina and Mexico.
Under the terms announced December 22, 2025, the consideration will consist of $2.7 billion in cash and $0.5 billion in Harbour voting ordinary shares. Harbour said the cash portion will be funded through a $1 billion underwritten bridge facility, a $1 billion term loan, and existing liquidity. The equity component will be issued as 174,855,744 new Harbour voting ordinary shares to LLOG Holdings LLC at an agreed value of $0.5 billion, or 215 pence per share.
Following completion, LLOG Holdings is expected to own about 11% of Harbour’s listed voting ordinary shares, with existing Harbour shareholders owning roughly 89%, subject to adjustments related to Harbour’s ongoing share buyback program that is expected to complete in the first quarter of 2026. Harbour added that 70% of the consideration shares issued to LLOG will be subject to a one-year lock-up following completion.
Harbour said the deal adds oil-weighted, long-life deepwater assets with significant operational control and is expected to improve portfolio margins and extend reserves life. The company cited LLOG’s working-interest production of 34 thousand barrels of oil equivalent per day, operating costs of about $12 per barrel of oil equivalent, and an estimated blended federal and state tax rate of approximately 23%. Harbour said LLOG’s key operated assets include Who Dat in Mississippi Canyon and Buckskin and Leon-Castile in Keathley Canyon, with Leon-Castile recently brought online.
Harbour also said the acquisition would add 2P reserves of 271 million barrels of oil equivalent, increasing Harbour’s year-end 2024 2P reserves by 22% and lifting its 2P reserves life from roughly seven years to eight years. Harbour expects the transaction to support group production of around 500 thousand barrels of oil equivalent per day to the end of the decade, and said production is expected to approximately double by 2028, underpinned by exposure to the Lower Tertiary Wilcox play and an inventory of infrastructure-led drilling opportunities.
The buyer positioned the transaction as free-cash-flow supportive, stating it expects the acquisition to be free cash flow per share accretive from 2027. Harbour also said it intends to move its distributions policy to a payout-ratio approach in 2026, incorporating a base dividend and share buybacks to align with international and U.S. oil and gas peers, while maintaining an investment-grade profile.
Harbour said LLOG will serve as its new Gulf of America business unit after closing and will incorporate the LLOG name to preserve its history and reputation. LLOG, founded in 1977 and headquartered in Covington, Louisiana, is described by Harbour as a leading deepwater operator with a multi-decade track record in the region.
Closing is expected in late Q1 2026 and remains subject to customary conditions, including the expiration or termination of U.S. Hart-Scott-Rodino waiting periods. Harbour said the transaction is a “Significant Transaction” under UK Listing Rules and is not subject to shareholder approval.
J.P. Morgan Cazenove acted as Harbour’s financial adviser, while Guggenheim Securities advised LLOG. Barclays and BofA Securities are listed as Harbour Energy corporate brokers.
KEY QUOTES
“Today’s announcement delivers on Harbour’s long-standing ambition to establish a presence in the deepwater Gulf of America. With LLOG, we found the right combination of high-quality assets and a talented team, providing a strong strategic and cultural fit with our company. The transaction positions us as a leading player in a region with well-established infrastructure, a supportive fiscal and regulatory environment and opportunities for additional growth. The oil-weighted, deepwater LLOG portfolio enhances our production profile, provides significant operational control, extends reserve life and improves our margins. In addition, the LLOG organisation brings decades-long experience in the Gulf of America with a successful track record, creating a solid foundation for Harbour in the area.”
“We are proud to build on LLOG’s strong heritage in the Gulf of America. Its advantaged portfolio and exceptional team, led by CEO Philip LeJeune, have established the company as one of the region’s most respected operators. Following completion, LLOG will serve as Harbour’s new Gulf of America business unit, which will incorporate the LLOG name in order to preserve and leverage its history and reputation.”
“We look forward to completing the transaction and welcoming Philip, his leadership team, and the entire organisation to Harbour, and to the future we will create together.”
Linda Z Cook, CEO Harbour
“The LLOG business complements our portfolio with a high-quality, long-life asset base underpinning strong production and cash flow growth profiles. Consistent with our practice following previous acquisitions, our priorities following completion of the transaction will be the safe integration of assets and people… continuing to deliver competitive shareholder returns and strengthening our investment-grade credit rating profile.”
Alexander Krane, CFO, Harbour Energy
“We are pleased to be joining an outstanding company and believe that by uniting our teams and expertise, we’re unlocking new possibilities, empowering our people, and setting the stage to achieve extraordinary results with Harbour.”
Philip LeJeune, CEO, LLOG
