Sale of Petro-Canada, Canada's national oil company, will begin with a 15% offering to Canadian investors.
Federal Privatization Minister John McDermid said the offering will be the first of several designed to put the company entirely in private ownership. He gave no date for the first sale.
The government disclosed in a Feb. 20 budget it will privatize the 14 year old Calgary company, which has a book value of about $4.2 billion. Terms of the sale will keep any single investor from owning more than 10% of the company and limit total non-Canadian ownership to no more than 25%.
McDermid said a big goal of the sale is to give Petro-Canada enough capital for major exploration and development programs. Revenue from an initial sale will go to the company with proceeds from later sales to the government.
Enabling legislation for the sale is to be introduced later this year.
Petro-Canada had 1988 assets of $8.6 billion and revenues of $4.67 billion. It produced 105,000 b/d of crude oil and natural gas liquids and 485 MMcfd of gas in 1988.
It operates five refineries with combined capacity of 305,000 b/d. Petro-Canada also operated 3,429 service stations in 1988. It has substantial interests in oil sands, heavy oil, and frontier acreage.
Chairman William Hopper last year said Petro-Canada will need about $500 million to finance its share of projects such as development of Hibernia oil field off Newfoundland.
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