Abu Dhabi buys Canada's PrimeWest for $2 billion
Wednesday, 26 September 2007
OTTAWA, Sept 25 (AFP): Abu Dhabi National Energy Company (TAQA) yesterday announced the purchase of Canadian oil and gas firm PrimeWest Energy Trust for 5.0 billion dollars, the company said.
TAQA's 26.75-dollar cash offer for each PrimeWest share is its third and biggest Canadian purchase this year.
Last month, the Emirati-based global energy company struck a deal to buy the Canadian unit of Irving, Texas-based Pioneer Natural Resources Co. for 540 million dollars.
In May, it also bought Northrock Resources Limited for two billion dollars from owner Pogo Producing Co. of Houston.
Its pursuit of PrimeWest comes two months after PrimeWest took over Shingingbank Energy Income Fund, also based in Calgary in a friendly share swap valued at 1.25 billion dollars.
Both trusts are predominantly natural gas producers, and both have suffered from low gas prices and a new tax on income trusts, announced last year.
TAQA sits on most of the UAE's oil and gas reserves, ranked respectively as fifth and fourth in the world. Proven oil reserves on their own are expected to last for another 150 years.
"This acquisition is a major leap forward for TAQA globally, and an important step toward the achievement of our strategy to grow to 20 billion dollars in Canadian assets," TAQA chief executive Peter Barker Homek said in a statement.
Historically, oil industry takeovers involved North American and European firms buying up companies in the Middle East. TAQA is believed to be the first company from the region to reverse this trend.
Barker Homek said Canada is a "key focus" of the company's global expansion.
But TAQA's takeover of PrimeWest is still subject to regulatory approvals, and must be endorsed by 66.6 per cent of PrimeWest unit holders.
TAQA's 26.75-dollar cash offer for each PrimeWest share is its third and biggest Canadian purchase this year.
Last month, the Emirati-based global energy company struck a deal to buy the Canadian unit of Irving, Texas-based Pioneer Natural Resources Co. for 540 million dollars.
In May, it also bought Northrock Resources Limited for two billion dollars from owner Pogo Producing Co. of Houston.
Its pursuit of PrimeWest comes two months after PrimeWest took over Shingingbank Energy Income Fund, also based in Calgary in a friendly share swap valued at 1.25 billion dollars.
Both trusts are predominantly natural gas producers, and both have suffered from low gas prices and a new tax on income trusts, announced last year.
TAQA sits on most of the UAE's oil and gas reserves, ranked respectively as fifth and fourth in the world. Proven oil reserves on their own are expected to last for another 150 years.
"This acquisition is a major leap forward for TAQA globally, and an important step toward the achievement of our strategy to grow to 20 billion dollars in Canadian assets," TAQA chief executive Peter Barker Homek said in a statement.
Historically, oil industry takeovers involved North American and European firms buying up companies in the Middle East. TAQA is believed to be the first company from the region to reverse this trend.
Barker Homek said Canada is a "key focus" of the company's global expansion.
But TAQA's takeover of PrimeWest is still subject to regulatory approvals, and must be endorsed by 66.6 per cent of PrimeWest unit holders.