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Analysts eye next merger candidates

CALGARY — With Suncor Energy Inc. (TSX:SU) set to add Petro-Canada’s (TSX:PCA) oilsands assets into its already formidable arsenal, international energy supermajors are likely looking at other Canadian oilpatch companies to bulk up their reserves.

CALGARY — With Suncor Energy Inc. (TSX:SU) set to add Petro-Canada’s (TSX:PCA) oilsands assets into its already formidable arsenal, international energy supermajors are likely looking at other Canadian oilpatch companies to bulk up their reserves.

Suncor, which already has the world’s second-largest oilsands operation, will have access to two major Petro-Canada projects after the $19-billion merger closes, as well as the former Crown corporation’s 12 per cent stake in Syncrude Canada Ltd., the multi-company partnership that is the No. 1 oilsands producer in the world.

Big international players in the oilsands like U.S.-based ExxonMobil Corp. (NYSE:XOM), through its Imperial Oil subsidiary (TSX:IMO) and France’s Total SA will likely be looking to takeover smaller targets, industry observers say.

“Nexen Inc. (TSX:NXY) remains a prime target . . . in the oilsands space. I think you probably would have to consider Canadian Oil Sands Trust (TSX:COS.UN) as a potential target as well,” said BMO Nesbitt Burns analyst Randy Ollenberger.

Nexen, which has a 65 per cent stake in the Long Lake oilsands venture and a seven per cent stake in Syncrude, has been the subject of much takeover speculation.

Canadian Oil Sands Trust is the largest player in the Syncrude consortium, with the next biggest slice belonging to Imperial Oil. which runs the Northern Alberta venture and is 70 per cent owned by ExxonMobil.