CALGARY — ARC Resources Ltd. and Seven Generations Energy Ltd. announced a merger agreement that will see the two companies combine their operations in the Montney region.

Under the terms of the proposal, Seven Generations shareholders will receive 1.108 common shares of ARC for each common share of Seven Generations held.

ARC shares closed at $7.42 on the Toronto Stock Exchange on Wednesday, while Seven Generations shares closed at $8.02.

The combined company will operate as ARC Resources Ltd. and remain headquartered in Calgary.

ARC chief executive Terry Anderson will lead the combined company, while ARC chairman Hal Kvisle will remain in his role. Seven Generations chief executive Marty Proctor will join the board and serve as vice-chair.

The combined company will have production of total over 340,000 barrels of oil equivalent per day in 2021, including 138,000 barrels per day of liquids and approximately 1.2 billion cubic feet per day of natural gas.

This report by The Canadian Press was first published Feb. 11, 2021.

Companies in this story: (TSX:VII, TSX:ARX)

The Canadian Press