25 March 2009 17:31 [Source: ICIS news]
TORONTO (ICIS news)--Canada is likely to approve the proposed $15bn (€11bn) merger between Canadian oil majors Suncor and Petro-Canada, which would create a "national energy champion," analysts said on Wednesday.
The deal comes after a string of takeovers of Canadian resources firms by foreigners. Only last month, Abu Dhabi's IPIC bid $2.3bn for Canadian petrochemicals major NOVA Chemicals.
The focus of the Suncor/Petro-Canada merger is on the oil sands in ?xml:namespace>
However, Communications, Energy and Paperworkers (CEP) union, which represents oil and chemical workers, urged a thorough review, given that the deal affected
One complication is an ownership restriction on Petro-Canada, which was founded as
Under the Petro-Canada Public Participation Act, no single shareholder can hold more than 20% in the company.
The merger also involves considerable petrochemical and refining assests but analysts did not see any immediate impact on production levels.
“I would assume that Petro-Canada will continue its propylene and BTX [benzene, toluene, xylene] businesses as before and that Suncor will continue to run its ethanol business as before, so not much impact,” John Cummings, an independent Toronto-based petrochemicals analyst, said in a preliminary assessment.
The combined company would have three refineries in
Chemical production capacities includes Petro-Canada’s 350,000 tonne/year of benzene, 240,000 tonnes/year of toluene, 210,000 tonnes/year of xylene, 45,000 tonnes/year of propylene and 25,000 tonnes/year of orthoxylenes in Montreal, according to the Canadian Chemical Producers Association.Petro-Canada also has 350,000 tonnes/year of paraxylene capacity at its 51%-owned ParaChem affiliate in
Suncor, for its part, is a supplier to a propylene project near
($1 = €0.74)
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