Canadian producers prime takeover targets

UBS Securities analysts see large-cap Canadian E&P companies such as EnCana, Nexen, Canadian Natural Resources and Petro-Canada as ripe for the picking if their forecast round of consolidation takes place.

In a note, Andrew Potter and Memet Kont, said there is “substantial opportunity for large-scale industry consolidation.”

In a global context, the four Canadian companies listed by UBS are “attractive takeover candidates due to their oil sands exposure” which is valued at less than $1 a barrel.

The two analysts are now forecasting that oil prices will remain above US$60 per barrel for the next three years and will stabilize at $43 on a long-term basis.

They said Canadian oil and gas shares have returned 289 percent over the past 12 months and have the potential for further gains..

—Gary Park