Chinese state firms to slow investment in Canada
Ottawa's curbs on oil and gas acquisitions by state sector will spur rush by private firms
Oil and gas acquisitions in Canada by Chinese state-owned enterprises will slow in the wake of Ottawa's restrictions after CNOOC's purchase of Nexen, said speakers at the Global Resource Investment Conference last week.
However, private Chinese companies were eagerly rushing to buy Canadian oil and gas assets, they added.
The value of Chinese acquisitions of oil and gas assets would see flat growth next year, said Gilbert Chan, president of NAI Interactive, a Canadian investor relations firm specialising in energy and mining.
"There are more restrictions on [state firms] to buy Canadian companies. So we will see uncertainty slowing acquisitions [by Chinese state firms], but more private Chinese companies [will be] buying," he said.
The deal size would be smaller due to restrictions on investments by state firms worldwide announced by Canadian Prime Minister Stephen Harper in December 2012, Chan added.
Harper signalled his government's preference for private foreign investments over investments by state firms, said a report by Canadian law firm Osler. He said the minister of industry would approve the acquisition of a Canadian oil-sands business by a foreign state firm "only in an exceptional circumstance", the report added.
Harper announced the investment restrictions at the same time the Canadian government approved the US$15 billion acquisition of energy firm Nexen by CNOOC, a Chinese state-owned oil major.
