CALGARY, Alberta, Feb 19 (Reuters) - Canada’s biggest pension plan is not the activist Petro-Canada PCA.TO shareholder it’s been made out to be, a top executive with the oil company said on Thursday.
Harry Roberts, chief financial officer at Canada’s fourth-largest oil producer and refiner, said his company’s dealings with the Ontario Teachers’ Pension Plan have been cordial after the fund boosted its interest.
A media report said early this month that Teachers’ was gearing up for a proxy fight and could seek to replace the board over the company’s poor stock market performance.
“They’re no more activist than a lot of our other shareholders, at least at this point,” Roberts said at an investor conference in Whistler, British Columbia. “I know what the papers were saying a couple weeks ago and I would characterize that as a misinformed article in the paper.”
A filing early this month showed Teachers’ nearly quadrupled its stake in Petro-Canada to about 16 million shares at the end of 2008, representing 3.3 percent of the outstanding stock. That was well below expectations of a 7 percent to 10 percent stake.
Roberts said the pension fund was not demanding management make major changes to the company’s strategy, which has shifted to preserving capital by deferring major projects until energy and financial markets recover.
“For our large shareholders, as we do with all our shareholders, we are readily accessible,” he said. “We do maintain cordial relationships and we’re spending a lot of time, not only with them, but with other shareholders.”
Some of Petro-Canada investors have griped about the stock price, which has lagged those of its peers, and have said the company should sell some of its widespread assets to concentrate on those offering the best returns.
Petro-Canada is trying to find ways to cut the costs of developing the proposed Fort Hills oil sands project in Alberta, which is on hold amid the industry downturn.
Roberts said Petro-Canada has no interest in selling its 12 percent interest in the Syncrude Canada Ltd oil sands venture as it moves forward with projects over which it has more direct control.
The long-term nature of Syncrude, which produces 350,000 barrels of synthetic crude a day, fits into the company’s strategy, he said.
“When you look at something like Syncrude, or any of the oil sands projects for that matter, they’re quintessential long-life projects. These have 50-, 60-, 70-year lives,” he said.
“I mean, I‘m going to be dead, buried and gone and these things will still be generating huge cash flows, and building a portfolio of these assets becomes very relevant as we move forward here and you start to think, ‘Where are these resource going to come from?'”
Petro-Canada shares were up C$1.06, or more than 4 percent, at C$27.17 on the Toronto Stock Exchange on Thursday afternoon. They have fallen 43 percent in the past 12 months.
$1=$1.26 Canadian Reporting by Jeffrey Jones; editing by Peter Galloway