The Globe and Mail reports in its Saturday edition that deals are again flowing at the pipeline and infrastructure end of the oil industry.
The Globe's Jeff Lewis writes that last week, companies that specialize in processing and transporting oil and natural gas tapped markets for combined proceeds of $2.7-billion, more than half the total amount of equity raised by the entire sector in the three-month stretch ended Sept. 30.
Keyera, Pembina Pipeline and Enbridge are raising money to patch up finances and finance growth as oil markets show signs of lasting improvement following a three-year slump.
The activity is notable because proceeds will help pay for big-ticket projects, rather than debt repayment alone. That signals major oil and gas companies are starting to accelerate production after three years of caution, stoking demand for new pipelines and processing gear.
At least one of the deals, a $300-million share sale by Pembina, is likely to be upsized owing to strong demand. Such financings are an easier sell for investors than similar offerings from oil and gas producers due to the companies' conservative business models that offer more predictable returns, says Raymond James analyst Robert Mark.
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