The first quarter carried the largest quarterly value of Canadian assets and companies for sale in three years, says Frank J.D. Sayer, principal, Sayer Securities Ltd., Calgary. The estimated value was C$2.8 billion-some four times more than during the previous quarter (C$700 million) and a big jump from the 2001-02 average quarterly values (C$1.1 billion). Many of the sellers were recently avid buyers that have since high-graded their new portfolios. Also, some sellers have simply been convinced to let go of some assets, due to the strong prices they're receiving on the market, he adds. The assets for sale during the first quarter included 102,715 barrels of oil equivalent (BOE) per day of production. Offerings of assets ranged from tiny (32 BOE per day) to huge (27,000), and had an average value of C$137.6 million. Offerings of whole companies carried 285 BOE per day to 8,088, and an average value of C$66.7 million, Sayer says. "The most significant assets for sale were by U.S.-based companies, which previously were buyers during the last few years, including Marathon Canada Ltd., National Fuel Exploration Corp. and Vintage Petroleum Canada." These packages contained some 41% of the total production for sale in the first quarter. Marathon's was the largest: some 27,000 BOE per day. Junior Canadian companies that put themselves up for sale included BelAir Energy Corp., Ravenwood Resources Inc. and Gauntlet Energy Corp. and offered 1,000 to 3,000 BOE per day of production. Private companies that decided to sell include Taurus Exploration Ltd. (8,088 BOE per day) and Stylus Exploration Inc. (7.0 million cubic feet of gas per day). Many Canadian companies are now quietly marketing themselves, he adds, to a select few "high value" buyers. "The apparent rationale [for private marketing] is that if bids are not high enough, there remains the option to continue operations without the negative impact of a failed sale process." -A&D Watch
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