Northern Oil & Gas Reaches First Deal for Canadian Energy Assets

US energy firm Northern Oil & Gas Inc. agreed to acquire a stake in Canadian oil and gas properties, its first foray into international assets.

Northern will pay Parallax Energy Operating Inc. C$350 million ($254 million) in cash and stock for a 25% interest in oil-producing properties and tens of thousands of acres in the Duvernay shale basin in Alberta, according to a statement Tuesday, confirming an earlier report from Bloomberg News.

“This could become a multibillion-dollar investment for us,” Nicholas O’Grady, Northern’s chief executive officer, said in an interview. The company had been seeking a deal in Canada for a few years and will continue to evaluate future possible investments, he said. “We really have a strong belief in the country.”

Foreign energy companies are beginning to look to Canada again after years of divestitures. The country opened an expanded oil pipeline to the west coast two years ago, and Prime Minister Mark Carney’s government has agreed to loosen a number of environmental rules on the fossil-fuel sector to spur development. Last month, Shell Plc struck a deal to buy Canadian shale producer Arc Resources Ltd. for $13.6 billion, after previously selling off assets in the Alberta oil sands.

The foreign deals also mark a change of investor sentiment under Carney, who has prioritized resource development. The former central banker, who became prime minister in March 2025, has moved to speed up project approvals and expressed support for an additional oil pipeline to the west coast.

Shares of Northern slipped 1.4% before the start of regular trading in New York. The company is based in Minnetonka, Minnesota, and holds assets across the US, including in the Permian Basin.

“We’ve done over $6 billion of transactions over the last eight years. We’ve never really appreciably sold anything,” O’Grady said. “We’re a long-term partner.”

The Duvernay is a shale formation in Alberta stretching from the Red Deer area to Grande Prairie. The region is rich in light oil called condensate, used to dilute bitumen in the oil sands. Parallax, backed by Houston-based Carnelian Energy Capital, will continue to operate the assets owned by Northern under the proposed agreement.

Northern expects to close the deal late in the second quarter.