China’s Yanchang makes Canada move despite restrictions

Despite new restrictions on the role of state-owned enterprises in Canada, Chinese oil companies remain keen to gain a foothold in the country’s oil patch

On 3 September, Yanchang Petroleum, which is owned by Shaanxi province and listed on the Hong Kong Stock Exchange (HSE), said it would acquire Calgary-based Novus Energy in a cash deal worth C$232 million ($221m), or C$1.18 per Novus share. Including debt, the transaction is worth C$320m. The transaction price is less than the C$344m threshold that would trigger an automatic review under Canada’s new foreign investment laws. Most Canadian deals by Asian state-controlled firms have focused on the country’s oil sands or liquefied natural gas projects. Yanchang, however,  is buying Novus’ light, tight oil assets. The company produced just 3,500 barrels a day (b/d) in the second quarter. But it