Energy Outlook May Drive Takeover Wave

[salin]

Energy Outlook May Drive Takeover Wave

April 18 — By Joseph A. Giannone
NEW YORK (Reuters) - Confidence that oil and gas prices will remain at lofty highs for years to come will spark a new wave of takeovers and asset sales among North American production companies, analysts and investment bankers say.

Since late last year, investors have sent independent oil and gas producer stocks to record highs amid growing confidence energy prices will not soon settle down. Now company executives are making the same bet, bidding on resources they are confident will generate strong returns over the long haul.

"We believe that merger and acquisition activity will increase," said David Heikkinen, an oil company analyst for Hibernia Southcoast Capital. "The expectations for long-term prices are higher than they had been historically."

On Thursday, Canadian major EnCana Corp. <ECA.TO> agreed to buy western U.S. producer Tom Brown Inc. <TBI.N> for $2.2 billion in cash plus assumed debt. A week earlier, offshore pioneer Kerr-McGee Corp. <KMG.N> said it would acquire Westport Resources Corp. <WRC.N> in a $2.54 billion stock swap.

Meanwhile, Murphy Oil Corp. <MUR.N> sold oil and gas fields in western Canada for about $624 million to Pengrowth Energy Trust <PGF_u.TO> and Canadian Natural Resources Ltd. <CNQ.TO>

This activity helped fuel further advances in the shares of other producers that specialize in onshore North American natural gas, amid speculation they too may become takeover targets. Big gainers on Thursday included Quicksilver Resources Inc. <KWK.N> and Evergreen Resources Inc. <EVG.N>

more: http://abcnews.go.com/wire/Business/reuters20040418_58.html

salin's comments... where in the world is Ken Laywaldo... lurking in and around any of these companies - at least in legacy and inspiration?

[daleo]

1. Yes, but how will this help peak oil?

A declining resource is a declining resource, no matter who owns it. This money would be better spent on research into alternatives.