Prudent pause for energy cause

Motorists pump petrol at a Petronas station in Putrajaya in this December 8, 2009 file photograph. The Canadian government blocked the C$5.17 billion (3.2 billion pounds) acquisition of Progress Energy Resources Corp by Malaysian state oil company Petronas, raising questions about other, bigger bids and about Canada's willingness to let foreign investors in. (REUTERS/Bazuki Muhammad/Files)

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When life starts chaotically coming from every which way, it is often wise to take a deep breath, put the fast and furious on hold, and reassess the lay of the land.

The same goes with politics.

Industry Minister Christian Paradis' surprising decision late Friday to suddenly block the takeover of Canadian natural gas producer, Progress Energy Resources, by Malaysia's state-owned Petronas was one of those moments.

It was time to reassess, and sort out the chaos, and not run full tilt into a deal just to get it out of the way.

But let's not read into this that it is a harbinger of the Harper government suddenly deciding to get intransigently tough regarding foreign takeovers within Canada's oil and gas sectors.

It was merely a pause for the cause, and well timed.

Too much was happening at once.

Certain media, however, are already expressing "widespread worry" on behalf of pipeline interests that Paradis' rejection of Petronas' $5.9-billion deal signals a sudden protectionism, and that other mega-deal buyouts such as China's state-owned CNOOC's plans to take over Nexen, and Exxon Mobile's $3.1-billion desire for Celtic Exploration will be forever nixed.

It wasn't that long ago, however, that Prime Minister Stephen Harper gave a hint that he wanted a template built to manage foreign attempts to get its hands on our natural resources, especially when it comes to state-owned enterprises like CNOOC and Petronas.

As we opined here, in fact, the idea of letting China, as one example, get its mitts on Nexen without a little quid pro quo from the communists was not the kind of deal that should be endorsed.

And the Harper government appears to be listening.

There is likely no question that Paradis's excuse for not allowing the Progress deal -- that it fell short of Canada's "net benefit" requirements -- is a bit of a smoke screen to bide time, especially since he was particularly evasive in coughing up details as to the reasons why the deal was benefit-lacking.

But both Progress and Petronas have a 30-day window to appeal and, by then, the Harper government will hopefully have its template for foreign takeovers ready to unveil.

One that everyone will understand.

Source: http://www.winnipegsun.com/2012/10/22/prudent-pause-for-energy-cause

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