Interest in Canadian oil and gas assets grows as top U.S. plays mature
A wave of renewed interest from U.S. investors — and even a few producers — is sweeping through Canada’s oil and gas sector, according to industry insiders. As top-tier drilling opportunities become harder to find in the U.S., attention is shifting north.
Earlier this month, American drillers were a visible presence in Calgary, attending Canadian energy conferences hosted by major banks. The timing coincided with the city's annual Stampede festivities — an event that blends corporate networking with cowboy culture.
RBC Capital Markets strategist Julian Triscott noted speculation during the Stampede that U.S. natural gas giant Expand Energy Corp. (formerly Chesapeake Energy) might be "looking up north" for acquisition opportunities.
According to TD Securities, this year’s energy conference in Calgary saw its highest turnout from U.S. investors and producers since before the COVID-19 pandemic.
“If you’d asked me three years ago how much U.S. interest there was in Canada, I’d have said almost none,” said Scott Barron, head of Calgary investment banking at TD Securities.
“That has changed dramatically.”
Canada Reenters the U.S. Radar
This rising interest from American players comes in stark contrast to the past decade, when foreign majors steadily exited Canada’s energy sector, citing high costs, ESG concerns, and sluggish pipeline development.
With maturing assets in U.S. fields like the Permian Basin, investors are now turning their eyes to Canada’s Montney formation — a liquids-rich, cost-competitive natural gas play straddling Alberta and British Columbia. The launch of LNG Canada has further fueled the appeal by opening new export pathways.
“There have been lots of people kicking tires and asking, ‘Should we be getting into the Montney?’” said Mike Belenkie, CEO of Calgary-based Advantage Energy Ltd.
Belenkie’s company was recently targeted by U.S. activist hedge fund Kimmeridge, which holds a high single-digit stake and has pushed for governance changes and a potential sale. “The U.S. is running out of inventory — especially high-quality inventory,” he explained.
“So the American companies are all thinking, ‘Where do we go next?’”
Long History of Capital Flight
For years, the answer was not Canada. Oil giants such as ConocoPhillips, ExxonMobil, and Shell pulled out of Canadian operations throughout the 2010s, discouraged by regulatory delays, rising costs, and interprovincial disputes.
But the trend may be shifting. “Absolutely, we are seeing and hearing more interest from U.S. producers and U.S. investors — including private equity — in Canadian energy,” Barron confirmed.
TD Securities has noted more U.S. firms signing up to participate in confidential sale processes.
“When we’re selling a company or assets, we’re increasingly seeing U.S. private equity show up and evaluate the opportunity.”
The Montney Draws Quiet Capital
Much of this new interest is zeroed in on the Montney basin. With strong economics, valuable condensate production, and large undeveloped reserves, the region offers attractive targets for both strategic acquirers and financial investors.
Reports and regulatory filings show that U.S. capital has already begun to flow — buying into private operators or launching new ventures in the Montney and nearby plays.
Still, some observers urge caution. “The trend is around Americans doing their homework and getting up to speed on Canada,” Barron said.
“But the trend is not yet in the transactions. We really need the first (deal) to happen, and then see if there’s follow-on momentum.”
A Long List of Interested Buyers
More U.S. producers are now frequenting virtual data rooms set up for asset sales — a sign that acquisition talks are progressing.
“People talk about it. So we know which companies have been coming,” said Belenkie. “There’s a long list of them.”
Geoff Cain, CEO of privately held Halo Exploration Ltd., said he’s hearing that as many as 20 non-Canadian entities have expressed interest in a nearby public E&P firm for sale in the Montney and Duvernay.
“It’s been a long time since I’ve seen this sort of activity level,” Cain said. “There are some well-heeled U.S. teams and private equity groups that have an interest in the Canadian operators — and that’s good for our sector.”
A Sector Hungry for Capital
Outside of major names like Tourmaline Oil or Canadian Natural Resources, many Canadian oil and gas firms continue to face limited access to capital, especially from domestic private equity and institutional investors.
“It’s hard. This business is so difficult,” Cain said. “We need a little more interest, and we need some more capital in the basin. It’s been a long time since we’ve had that.”
While U.S. producers haven’t yet made major Montney acquisitions, the groundwork appears to be in place. The question is no longer whether American interest in Canada is returning, but when it will lead to action.
