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Cenovus Energy shares plummet on news of its $3.8B deal to buy Husky Energy

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The all-share deal by Cenovus Energy Inc. to buy Husky Energy Inc. for about $3.8 billion will likely spark more mega-mergers among Canadian oil and gas majors, according to a veteran oilsands analyst.

“This is likely just the start of big deals in Canadian energy land and thus it begs the question of who is next?” said analyst Phil Skolnick of Eight Capital in a report on Monday.

“As seen in the U.S. with the accelerated M&A activity, when there’s one meaningful transaction, there’s likely more to come.”

Several industry observers point to Calgary-based oilsands producer MEG Energy Inc. as the leading potential target, noting Husky’s failed $3.3-billion hostile takeover attempt of its smaller rival two years ago.

In his report, Skolnick presents scenarios where Canadian Natural Resources Ltd. (sometimes referred to by its stock ticker, CNQ) or Imperial Oil Ltd. buy MEG, while also outlining the numbers involved if Canadian Natural combined with Imperial or Suncor Energy Inc., and if Suncor were to merge with Imperial.

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“Some (scenarios) have been asked about before and I was just bringing up some new ones _ like a CNQ and Suncor merger is not something I’ve heard out there, but nor was Cenovus-Husky,” he said in an interview.

“I’m not going to give zero chance to anything anymore.”

Analysts generally applauded the surprise Cenovus-Husky hookup announced Sunday for its operational advantages but criticized the plus-20-per-cent premium in the price for Husky.

“The deal does makes strategic sense,” said Manav Gupta of Credit Suisse in a note to investors.

“Like U.S. E&P (exploration and production companies), Canadian energy companies also need to come together, cut costs and become leaner to better adapt to lower energy demand in post pandemic world.”

He said Cenovus’s reputation as an efficient operator in its steam-driven oilsands projects will help Husky overcome its struggles with operational issues, including higher operating and administrative costs.

The companies have identified $1.2 billion in potential annual cost savings which will include workforce reductions.

 

But Gupta added the premium is “excessive” and joined other observers in predicting Cenovus shares would trade lower, as they did, falling by as much as 15 per cent to $4.15 in Monday trading in Toronto before closing down 8.4 per cent at $4.47.

Husky, meanwhile, gained as much as 14.2 per cent to $3.62 before closing up 12 per cent at $3.55 .

Husky shareholders are to receive 0.7845 of a Cenovus share plus 0.0651 of a Cenovus share purchase warrant in exchange for each Husky common share if the deal is concluded.

Cenovus shareholders would own about 61 per cent of the combined company and Husky shareholders about 39 per cent.

The transaction must be approved by at least two-thirds of Husky’s shareholders but Hong Kong billionaire Li Ka-Shing controls 70 per cent of Husky’s shares and has agreed to vote them in favour of the deal.

The announcement Sunday came just as Calgary’s oilsands companies are about to start rolling out third-quarter financial results, with Suncor Energy Inc. set to report Wednesday and both Cenovus and Husky scheduled to report on Thursday.

© 2020 The Canadian Press

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Many Canadians believe worst is yet to come in COVID-19 pandemic: poll – News 1130

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VANCOUVER (NEWS 1130) – Despite B.C. recording its deadliest COVID-19 numbers yet, many people think the worst of the pandemic is still ahead of us.

With no guarantee for when the health crisis will end, people increasingly are feeling grim about growing case and death toll numbers in this country, according to a poll from Research Co.

Pollster Mario Canseco says a lot has changed in just a few months.

“It started to get a little bit better when it came to the way Canadians perceived this COVID-19 pandemic in the summer. But now, we’re back to the level we had a couple of months into the lockdown. So, definitely, the views of many Canadians are turning sour,” he tells NEWS 1130.

The survey has found that 64 per cent of Canadians polled believe “the worst of the pandemic is ‘definitely’ or ‘probably’ ahead of us.”

That, Canseco notes, is an 18-point increase from September.

“I think it’s a combination of factors. We are heading into the end of the year, the holiday season. We might be in a situation where it’s going to be difficult to get together with family. When we were first asking about this back in March and April, you saw a lot of people who expected this crisis to last five or six months, maybe seven months,” he says.

“The idea that we were going to be heading into, probably, a second lockdown in some parts of the country right before the holidays was not something that was fathomable for a lot of Canadians, but now seems to be something that could be happening fairly soon.”

Meanwhile, Research Co. has also found many Canadians are in favour of staying put.

Restrictions on travel

Canseco says there’s been consistent support when it comes to dealing with travel.

“Ninety-two per cent say it’s a good decision to keep the border with the United States closed to non-essential travel, 90 per cent saying everybody who travels into Canada has to go into a mandatory quarantine.”

In addition to that, Canseco says 82 per cent of respondents are in support of prohibiting non-essential travel between provinces, while 75 per cent say they’d endorse limiting travel within their province.

“The level of support for something like this is quite high and it’s really not something that I expected to see. I thought it was going to go, maybe, 50/50. The holidays are coming, people don’t want to say that they would be happy curtailing travel plans. But now that we see the magnitude of the situation, the number of cases, there are definitely more Canadians who say let’s not even travel from within our own provinces because the spread hasn’t been contained yet.”

When it comes to how the federal government has been handling the health crisis, British Columbians showed the highest level of satisfaction out of the four most populous provinces.

And as we wait patiently for a vaccine, more than 70 per cent say they’ll definitely or probably get one as soon as they’re able to, not marking a significant change from what was seen in the last survey.

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LILLEY: Trudeau tries to spin his government's lack of detail on vaccines – Toronto Sun

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Article content continued

So, into this murky situation waltzed Anita Anand, Trudeau’s minister of public services and procurement.

“I wish to address some misinformation,” Anand said.

She said Canada was among the first countries to sign with Moderna, the fourth to sign with Pfizer and that our vaccination program was second to none.

OK, but when we will get the vaccine is still up in the air.

“It is not possible to circle a single date on a calendar,” Anand said in response to a reporter’s question.

The fact is, no one is asking for “a single date on a calendar.” People are looking for a general timeline.

The provinces, which need to distribute the vaccine, need to be able to plan.

“The delivery window is within the first quarter of 2021,” Anand said.

That is what media outlets have been reporting, the government’s words, repeated over and over again. Sometime in the first three months of 2021 we will get, we hope, enough doses to vaccinate 3 million Canadians, or 8% of the population.

By September, Trudeau says that “if all goes according to plan,” we will have somewhere between 51% and 100% of the country vaccinated.

The Conservatives say this puts Canada at the back of the line. A touch of hyperbole perhaps, but finishing months after the United States, the U.K. and other allies have wrapped up their vaccination program does leave Canada behind others.

Trudeau’s Liberals should worry less about denouncing the media for what they now call “misinformation” and spend more time nailing down the details of their plan.

That’s what Canadians need, not lectures.

blilley@postmedia.com

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COVID-19 update for Dec. 1: 656 new cases, 16 more deaths in B.C. | Premier Horgan's popularity remains high – Vancouver Sun

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Fraser Health says the machines can remove viruses and bacteria from a room in as little as 20 minutes.

10:30 a.m. – Tam says older Canadians should be at front of line for vaccine

Chief public health officer Dr. Theresa Tam says when looking at people experiencing the most severe illness, older Canadians are more at risk than younger Canadians with pre-existing conditions.

She says that suggests after the initial round of vaccines goes to people in high-risk living or work situations, like long-term care centres and hospital staff, the next round of immunizations should be done by age, with the oldest Canadians at the front of the line.

— Canadian Press

8 a.m. – Premier Horgan’s popularity remains high

Despite surging COVID-19 cases in the province, Premier John Horgan continues to maintain a high level of approval among British Columbians.

In a recent Angus Reid poll, conducted Nov. 24-30, 64 per cent of respondents said they approved of Horgan’s performance during the pandemic while 30 per cent disapproved and six per cent were unsure.

Although his popularity among British Columbians has dropped five points since last quarter, Horgan’s approval rating is tied for the highest in country, with Quebec Premier Francois Legault, despite new wave of COVID-19 related physical-distancing and social restrictions in B.C.

7 a.m. – Canadians OK with vaccine wait: pollA new poll suggests most Canadians aren’t currently worried that people in other countries might get a COVID-19 vaccine first.Thirty-seven per cent of respondents to a survey conducted by Leger and the Association for Canadian Studies say they are very concerned that Canada may not receive doses of a new COVID vaccine as early as the United States while 48 per cent say they are not concerned.Ten per cent say they don’t care at all or are not planning to get vaccinated anyway.With the likelihood of multiple vaccines coming on to the market over a period of time, just 28 per cent of respondents said they will take the first vaccine they can get, while 45 per cent say they will wait for other vaccines to become available.The poll suggests that the vast majority of Canadians want people entering Canada to be vaccinated against COVID-19, with 83 per cent of respondents say being vaccinated should be required.The online poll of 1,516 adult Canadians was conducted from Nov. 26 to Nov. 29.– Canadian Press

12 a.m. – Vancouver police issue $7,130 in fines to hosts of four illegal parties

Vancouver police issued just over $7,000 in fines at four different parties over the weekend that were held despite current COVID-19 health orders.

Under current B.C. health orders, social gatherings aren’t permitted with anyone outside of the household bubble. The orders were implemented to cut down on the transmission of COVID-19.

12 a.m. –B.C. posts record 46 deaths over the past three days

B.C. reported 46 deaths between noon Friday and noon Monday and 2,077 new cases of COVID-19.

Provincial health officer Dr. Bonnie Henry also added another 277 cases to B.C.’s total caseload after an earlier accounting mistake was corrected in Fraser Health.

Henry said 36 of the deaths over the previous three days were in residents of long-term health care facilities.

Between noon Friday and noon Saturday there were 750 cases reported, 731 between noon Saturday and noon Sunday and 596 between noon Sunday and noon Monday.

12 a.m. – Another vaccine candidate submitted to Health Canada for approval

Federal Health Minister Patty Hajdu says Johnson & Johnson has submitted its COVID-19 vaccine candidate for Health Canada’s approval.

It’s the fourth potential vaccine sent for assessment in Canada and the first that would require one dose to confer immunity instead of two.

Health Canada has been examining vaccine candidates from Pfizer, Moderna and AstraZeneca since October, when those companies sent partial data on their drugs for what’s called a “rolling review.”

If the Johnson & Johnson vaccine meets Health Canada’s standards for safety and effectiveness, the Canadian government says it has a deal to buy 10 million doses and an option on up to 28 million more.

— Canadian Press

12 a.m. – Liberals to post $381B deficit as debt levels as percentage of economy surge higher

The Liberal government expects to post a $381-billion deficit in 2021, not including a new pool of stimulus funds announced on Monday that will put further strain on Ottawa’s finances as pandemic spending continues to climb.

Finance Minister Chrystia Freeland tabled the updated figures in her fiscal update, which showed the deficit rising still higher than Ottawa’s earlier projection of $343 billion in 2020-21.

The Liberals on Monday also promised another $70 billion to $100 billion over the next three years in stimulus measures, but declined to outline the details of the new spending, saying it was “highly dependent on the evolving health and economic situation” in Canada.


LOCAL RESOURCES for COVID-19 information

Here are a number of information and landing pages for COVID-19 from various health and government agencies.

B.C. COVID-19 Symptom Self-Assessment Tool

Vancouver Coastal Health – Information on Coronavirus Disease (COVID-19)

HealthLink B.C. – Coronavirus (COVID-19) information page

B.C. Centre for Disease Control – Novel coronavirus (COVID-19)

Government of Canada – Coronavirus disease (COVID-19): Outbreak update

World Health Organization – Coronavirus disease (COVID-19) outbreak

–with files from The Canadian Press

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