Vermilion Energy Inc. ( VET ) announced Friday that it will sell its oil and gas assets in Saskatchewan and Manitoba for CA$415 million in cash. The deal supports Vermilion's strategy to streamline its portfolio and improve financial stability.

The transaction, expected to close in the third quarter of 2025, will help pay down debt. Vermilion forecasts ending 2025 with approximately CA$1.5 billion in net debt and a net debt-to-funds-from-operations ratio of 1.4 times.

The divested assets produce about 10,500 barrels of oil equivalent per day, 86% of which is oil and liquids, and are projected to generate CA$110 million in annual net income. They carry 30 million barrels of proven developed reserves and $250 million in future abandonment liabilities.

Following the sale, Vermilion expects 2025 production to average 120,000 to 125,000 boe/d, with capital spending between CA$680 million and CA$710 million—down about CA$50 million due to the divestiture. The company plans to prioritize free cash flow over production growth amid ongoing market volatility.

The move aligns with Vermilion's long-term shift toward high-return, long-duration assets, with a growing focus on Western Canada and Europe, including recent exploration success in Germany.

Investors interested in energy exposure may consider ETFs such as the Energy Select Sector SPDR Fund ( XLE ) and the iShares S&P/TSX Capped Energy Index ETF .

Price Action: VET shares are rising by 0.7% at $6.44 in early trading on Friday.

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