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by Stockwatch Business Reporter

West Texas Intermediate crude for July delivery lost 84 cents to $59.61 on the New York Merc, while Brent for August lost $1.24 to $63.02 (all figures in this para U.S.). Western Canadian Select traded at a discount of $10.15 to WTI ($49.46), unchanged. Natural gas for July added 3.7 cents to $2.81. The TSX energy index lost 2.74 points to close at 207.39.

The fight for Pacific Rubiales Energy Corp. (PRE: $5.61) grew more intense this week, as the company urged shareholders to vote for a proposed takeover, and an influential dissident urged the opposite. Pacific Rubiales wants to close a $6.50-a-share takeover by Alfa SAB and Harbour Energy. Alfa already owns 18.9 per cent of the company's 316 million shares. That puts it just behind a larger shareholder, O'Hara Administration, which (along with affiliates) controls 19.8 per cent and says the takeover offer is much too low. It says it will exercise its dissent rights in order to breach one of the offer's conditions. On Tuesday, Pacific Rubiales held a conference call to: (i) cheerlead for Alfa and Harbour; and (ii) boo O'Hara. Its complaint was that O'Hara started acquiring its shares just prior to the Alfa/Harbour announcement, so it is clearly an opportunist that does not represent other shareholders' best interests. As well, even though it has made a lot of noise about opposing the Alfa/Harbour offer, it has not put forth any proposal of its own, said Pacific Rubiales. That changed yesterday after O'Hara officially began a proxy war with the company ahead of the planned special meeting on July 7. The dissident proxy circular urges shareholders to "save Pacific Rubiales" and support O'Hara's plan, which is to reject the Alfa/Harbour takeover, appoint two new directors and keep the company public, at least until a better offer comes along. "There is no immediate necessity to sell Pacific Rubiales as it has over $860-million (U.S.) in cash and is showing operational improvements," says O'Hara. It adds that there is especially no need to sell at the low price of $6.50, which is far below the 52-week high of $23.79, as well as the company's own estimate of its net asset value, $9.22 (as stated by president Jose Francisco Arata on March 18). O'Hara says Pacific Rubiales has been doing a decent job cutting costs and streamlining its operations, which, along with rising oil prices, should lead to "continuous improvements in liquidity and profitability." The solution in O'Hara's view is better governance. It wants Isaac Alvarex and Luis Manas, former executives of Spain's Repsol, appointed to the board of directors.

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