Financings plummet; worse in store

Canadian oil industry financings and share values took a sharp dive in 1998, painting a gloomy picture for companies trying to raise E&D money. Total equity offerings fell to C$1.9 billion from C$8 billion in 1997, while stocks have slumped 45 percent since August 1997. “If oil prices are down and the market for oil stocks is down for another year or so, there will be severe implications,” said Sayer Securities Ltd. President Frank Sayer, warning of even greater spending cuts, layoffs and mergers. Other analysts say producers burdened by debt and restricted cash flow will be driven out of desperation to seek mergers or unload assets adding to the C$1.5 billion already on the block.