Alberta oil patch risks losing Indian investment over Ottawa’s mixed messages

Source: Economic Times via Indian Economic Business News

Canada’s mixed messages on foreign investment from state-owned enterprises threaten to spook India’s major energy giants, the country’s top diplomat in Ottawa said recently. Ottawa is contemplating tweaks to the Investment Canada Act that would broaden the definition of state ownership and potentially subject minority purchases of natural gas and oil sands assets to the opaque net-benefit test, according to an analysis by lawyers at Osler Hoskin & Harcourt LLP. The federal government introduced new rules last year after the $15.1-billion purchase by China’s CNOOC Ltd. of Nexen Inc. and the $6-billion acquisition of Progress Energy Resources Corp. by Malaysia’s Petronas. The changes barred state-run companies from majority ownership of oil sands assets or companies. “This would be a departure from what was clarified in Ottawa in December … and will certainly add considerable uncertainty for potential investments,” Nirmal V erma, India’ s High Commissioner to Canada, told an investment conference in Calgary hosted by the Canada-India Business Council.