Petronas May Sell $7B Canadian Energy Operations

Petronas, the national oil company of Malaysia, is reviewing options to sell its Canadian natural gas business, which could be valued between $6 billion and $7 billion. This move comes as the company tries to manage losses caused by low oil prices and global market shifts.

The Canadian unit was previously called Progress Energy Resources Corp. Petronas bought it in 2012 for about $5.3 billion. It was a big step for the company, giving it access to valuable shale gas assets in North America. Since then, the business has grown and now holds more than 800,000 acres of land in British Columbia with large reserves of natural gas.

People familiar with the matter say Petronas has hired a financial adviser to look at possible deals. The company may sell the entire business or just a part of it. No final decision has been made yet. Petronas has also started speaking with possible buyers to see how much interest there is.

Petronas Canada operates in the North Montney Basin in northeast British Columbia. This area is known for its rich natural gas reserves. According to the company’s website, Petronas and its partners control about 53 trillion cubic feet of natural gas reserves and contingent resources in the region. These assets make the business attractive to investors, especially as demand for natural gas continues to rise globally.

In addition to owning large gas fields, Petronas also holds a 25 percent stake in the LNG Canada project. This is a major liquefied natural gas joint venture that aims to export Canadian natural gas to markets in Asia. Other members of the project include Shell, PetroChina, Mitsubishi, and Korea Gas. The LNG Canada project is one of the biggest energy developments in the country, though it has faced delays and rising costs.

Low oil prices have hurt many energy companies, and Petronas is no exception. In 2024, the company reported a drop of more than 30 percent in net income. As a result, it announced job cuts that will start this year. Selling its Canadian business could help raise cash and support the company’s other projects in Asia and the Middle East.

Although oil prices have been falling, natural gas is still seen as a cleaner alternative to coal and oil. Many countries are switching to natural gas to meet climate goals. This has made gas projects more appealing to long-term investors. That is why Petronas’ Canadian assets could receive strong interest from buyers, even during a weak oil market.

The company may decide to sell only a minority stake if it does not get a good price for the full business. This would allow Petronas to keep some control while also bringing in funds. Potential buyers could include large global energy companies or investment groups looking to grow in North America.

Energy companies around the world are reviewing their plans due to market uncertainty. Prices have been unstable, and demand is shifting as countries try to reduce carbon emissions. In this environment, companies like Petronas are focusing on their strongest assets and cutting back where needed.

Selling part or all of the Canadian business could help Petronas become more flexible. It may use the money to focus on projects in Southeast Asia, where it already has deep experience. It may also invest more in clean energy, which is becoming a top priority for many oil and gas firms.

Petronas has not given an official comment yet, and the details of the possible sale are still private. But the fact that it is considering such a large deal shows how much pressure the company is facing after a tough year.

The energy market is changing fast. Companies that can adapt and make smart moves may be better positioned for the future. Petronas appears to be taking steps to stay strong, even if it means selling valuable assets.