Recap of Asian investment in Canada’s resource sector

There was significant foreign investment flow into Canada by Asian SOEs and other private institutional investors. Therefore the transaction size was larger in comparison to prior years.

What attracted the capital? various oil sands, shale gas, and LNG projects due to high demand and interest in the oil and gas sectors in Asia.

Significant transactions in 2012 involving Asian direct investment in Canada:
• PetroChina in its proposed partnership with TransCanada
Corporation to construct, own and operate the Grand Rapids
Pipeline System, its investment in British Columbia shale gas assets
owned by Shell Canada and its purchase of the balance of the
interests in the McKay River oil sands project;

• the acquisition of Grande Cache Coal Corporation (Grand Cache 
Coal) by Marubeni Corporation (Marubeni) and Winsway Coking
Coal Holdings Limited (Winsway);

• CNOOC’s acquisition of a 35% interest in the Long Lake oil sands 
project through its acquisition of OPTI Canada Inc. (OPTI);

• minority investments by Wuhan Iron & Steel in Adriana Resources 
and by Heibei Iron & Steel in Alderon Resources, to facilitate the development of iron ore mines in Quebec and Labrador respectively; and

• the announcement by Encana and PetroChina of a $2.1 billion joint
venture to explore and develop properties in the Duvernay region
of Alberta.

Aside from those conventional oil & gas sector, Asian SOEs and other private institutional investors have also invested in Canadian non-conventional resource sector, contributing to its impressive growth. The oil sands are a good example for attracting capital, such as the acquisition by Petronas of 50% interest in shale gas formations in the Montney region of British Columbia and acquisition by Asian consortium of 40% interest in certain gas formations in Horn River, Cordova and Laird.

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