Encana-Talisman in Play as Petronas Seeks Canadian Gas: Real M&A

Malaysia’s bid to secure natural gas supplies in Canada is turning Encana Corp. and Talisman Energy Inc. into two of the industry’s cheapest targets.

Petroliam Nasional Bhd., the state-owned oil company known as Petronas, is studying a Canadian acquisition of more than $5 billion, Chief Executive Officer Shamsul Azhar Abbas said in an interview last week with Bloomberg News. Encana is searching for partners to fund drilling and is worth just $1.50 per thousand cubic feet of gas reserves, the least among producers in Canada, according to data compiled by Bloomberg. Encana and Talisman, which is spending less on extracting natural gas after prices fell to a 10-year low, are also the two cheapest versus output.