It’s taken a decade for Canada’s oil and gas sector to return to this point, but 32 petroleum producers in the country recently hit a noteworthy milestone.

New data from analyst Jeremy McCrea at BMO Capital Markets shows that for the first time since 2016, there were 32 oil and gas producers on the Toronto Stock Exchange with a market capitalization exceeding $1 billion at the end of May.

That’s double the number seen in 2020 during the pandemic, although still down from 39 reported in 2013.

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Of the current group, 13 companies had a market cap above $5 billion, with 19 oil and gas producers between $1 billion and $5 billion.

The increase in the valuation of the intermediate and large producers — led by Canadian Natural Resources, with a market capitalization of nearly $117 billion on Thursday — reflects several industry trends.

These include rising oil prices this spring that pushed up energy share prices, growing interest from international investors in the Canadian industry as the U.S. shale sector matures, and a wave of mergers and acquisitions (M&A) that has seen far fewer — but substantially larger — businesses emerge.

“You go through these decade-long cycles. You’ve got a boom, you’ve got a bust, you consolidate. And then you kind of reform again, and we’re in that consolidation phase here right now,” McCrea........

© Calgary Herald