More international energy players likely to make acquisitions in Canada

Canada is one of the few regions left in the world that has a multitude of bite-sized firms exploiting its vast oil and gas resources, making it fertile ground for reserve-hungry global players to launch acquisitions.

“I think that Canada is an attractive area because there are lots of relatively small independent companies in Canada, which are easier to acquire than perhaps other regions of the world, where big players are exploiting oil,” said Tom Grieder, Asia Pacific analyst with IHS Global Insight in London.
Most recently, state-owned Korea National Oil Corp. agreed this week to buy Calgary-based Harvest Energy Trust (TSX:HTE) for $4.1-billion in cash and debt.

KNOC’s stated mission has been to grow into one of the globe’s top 50 global energy companies with production of 300,000 billion barrels of oil equivalent per day and reserves of two billion barrels.

It has said it wants to acquire two companies by the end of the year, and between five and 10 more over the longer term.

The Harvest acquisition – among its largest to date – gets KNOC firm access to conventional oil assets in Western Canada, holdings in the oilsands and some natural gas production. It already has a small presence in the oilsands, which has yet to be developed.

Canadian Press