Tamarack Valley and Headwater Merge for C$10 Billion

Tamarack Valley Energy Ltd., one of Alberta's prominent Clearwater-focused drillers, is joining forces with Headwater Exploration Inc. in a massive all-stock merger valued at approximately C$10 billion ($7.25 billion). The combined entity will create the largest publicly traded producer dedicated to the Clearwater Formation.

The transaction sees Headwater shareholders receive one common share of Tamarack for each share they hold, while Tamarack will issue roughly 237.8 million new shares. Legacy Tamarack investors will control 66.5% of the combined entity, with Headwater shareholders owning the remaining 33.5%.

Tamarack President Steve Buytels expects the deal to boost free funds flow per share by over 10%, reduce the 2027 decline rate to 15%, and lower the unhedged free funds flow breakeven to $37 per barrel. The combined entity will control more than 1,500 sections across the Clearwater fairway, with over 300 million barrels of oil equivalent of proved and probable (2P) reserves.

Tributary Exploration Inc., a newly created publicly listed company, will be formed to hold certain non-core exploration assets. The two companies intend to transfer these assets into Tributary, including Mannville-stack exploration rights in Alberta, thermal heavy oil prospects at Handel in Saskatchewan, and legacy McCully gas production in New Brunswick.