US-based multinational conglomerate Berkshire Hathaway has disclosed that it has acquired a new stake in Canadian oil and gas company Suncor Energy.
The latest investment round was revealed in the company’s filing with the Securities and Exchange Commission (SEC) regarding a quarterly update on holdings, according to the Associated Press.
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It represents the second time Berkshire Hathaway has taken a stake in Suncor in six years.
The publication reported citing the SEC filing that Berkshire Hathaway owned 10.76 million Suncor shares at the end of last year.
Suncor is seen as a safe investment option by potential investors due to its integrated structure and diversified business mix, Reuters reported.
The investment comes as global investors have been pulling away from Canada due to the country’s carbon-intensive oil sands and transportation bottlenecks.
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By GlobalDataThe Canadian energy sector has been affected by issues pertaining to approval of pipelines, resulting in Alberta crude selling at a steep discount. Matters became worse when a federal court halted the Trans Mountain expansion project.
Another major pipeline infrastructure Keystone XL is facing legal hurdles in the US. Increasing production and lack of adequate pipeline transportation caused a supply glut in the market.
In response, the Alberta provincial government ordered companies to reduce production in a bid to prevent oversupply and help shore up prices.
The Reuters report added that Berkshire took a position in Suncor in 2013 and exited its stake in 2016.
During the fourth quarter of last year, the Canadian energy firm’s total upstream production stood at 831,000boe/d.
Suncor’s guidance for this year includes a capital investment between C$4.9bn and C$5.6bn, as well as an average upstream production of 780,000-820,000boe/d.
