Will Suncor Energy Buy Upstream Assets In Eastern Canada?

In order to boost its offshore upstream operations Suncor Energy Inc. (NYSE:SU) – Canada’s premier integrated energy player – is now planning to acquire properties in the North Sea and eastern Canada, going by Reuters.

The source revealed that it has been easy to procure properties amid weak oil prices – although the commodity is walking on the bullish path but is still way below the mid-2014 level. Most importantly, the transaction will likely be worth as high as several hundred million dollars to a few billion dollars.

It is to be noted that, if successful, the acquisition will enhance the company’s reach from its oil sands operations – the major source of business. Investors should also note that the company is looking forward to acquire downstream properties – which include refineries – in the U.S.

Suncor is now on its way to re-evaluate its growth strategy after its operations were hurt by the massive Canadian wildfire. Suncor and the other leading producers of oil in the region were compelled to stop their operations for weeks following the wildfire. In fact, with this production halt, output of oil in Canada fell by more than 1 million barrels per day.

SUNCOR ENERGY Price

Calgary, Alberta-based Suncor's operations include oil sands development and upgrading, conventional and offshore crude oil and gas production, petroleum refining, and product marketing under the Petro-Canada brand.

Currently, the company carries a Zacks Rank #4 (Sell), implying that it will underperform the broader U.S. equity market over the next one to three months.

Some better-ranked players in the energy space include McDermott International Inc. (NYSE:MDR) , North Atlantic Drilling Limited (NYSE:NADL) and Boardwalk Pipeline Partners, LP (NYSE:BWP) . Each of these stocks sports a Zacks Rank #1 (Strong Buy).