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Oil Patch Insider
First Calgary steps down from auction block
First Calgary Petroleums, the Canadian junior with a bundle of Algerian natural gas assets, has scrubbed plans to sell itself, choosing instead to explore joint venture options with Spain’s Repsol.
The company said in a news release May 24 it believes that partnering with Repsol will be “more materially beneficial” for its shareholders, who had been hoping to reap a windfall from outright sale.
While talks with Repsol are proceeding, First Calgary will suspend talks with other parties who had surfaced during its eight-month search for a possible buyer of its holdings in west-central Algeria’s Berkine basin, which is claimed to hold 13 trillion cubic feet of gas, although the company’s net proved reserves are estimated at 284 billion cubic feet.
The Sunday Times newspaper in London reported that First Calgary dropped its auction efforts after failing to attract buyers willing to pay its asking price.
That report forced a trading halt May 24, but investors signaled their displeasure May 25, slashing 12 percent off First Calgary shares, which ended the day at C$11, almost C$14 below a peak in February when expectations of a lucrative buyout were high.
The market value of First Calgary has now slumped below C$2.7 billion.
If nothing else, analysts have welcomed steps by the Toronto Stock Exchange to end speculation about First Calgary’s future. Housing markets on fire in Alberta: Do we have a real estate deal for you? Powered by a scorching energy sector, homes sales are at an all-time high in Alberta, with the industry’s head office city of Calgary posting the biggest year-over-year gain in sales for all of Canada.
Meanwhile, the “oil sands capital” of Fort McMurray, has claimed the title of “corporate housing capital of Canada.”
House sales in Calgary were up 23.8 percent in April from a year earlier and the average house sold for C$249,331, a 13.2 percent increase.
Elton Ash, regional vice president of Rex/Max Western Canada, said his agents describe the Calgary market as “busy to the point of being crazy.”
He said Calgary is “famous for boom and bust and this is boom.”
The Canadian Real Estate Association is predicting an average price for 2005 of $244,700, beating last year’s record by 8.2 percent.
Under a severe accommodation squeeze, Fort McMurray needs 1,600 single-family homes right now and more than 6,000 by 2010, said Chamber of Commerce president Mike Allen.
Royal LePage said the city has the lowest corporate vacancy rate in Canada and is the second largest market behind Toronto.
The company said the “supply crunch” has reached the point where demand is likely to spill over to Edmonton, 260 miles to the south. USGS celebrates 110 years in Alaska The U.S. Department of the Interior’s U.S. Geological Survey is celebrating its 110th year in Alaska with an open house June 4 at the map sales area of the USGS Alaska Science Center in Anchorage. The open house also celebrates a new partnership between USGS and the Alaska Natural History Association to operate the Earth Science Information Center.
The open house, at Grace Hall at Alaska Pacific University, University Drive in Anchorage, will be from noon to 5 p.m. Saturday June 4. A map is available at: http://www.alaskapacific.edu/university_info/.
In 1895, Congress appropriated $5,000 for USGS to begin land surveying and mineral exploration activities in Alaska. In 2005, the USGS Alaska Science Center has 200 scientists and support staff. For more information go to http://alaska.usgs.gov/.
–Gary Park & Kristen Nelson
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