Did Petronas push up Canadian firm's shares?

The government must explain why it let state oil company Petronas pile into Progress Energy's shares, pushing its prices up by over 90 percent, before taking the company private last year, PKR said.

Raising more questions about the RM16 billion deal, PKR director of strategy Rafizi Ramli claimed today that Petronas single-handedly moved up the shares of the Toronto stock exchange-listed company.

Its purchase of the Canadian oil and gas company in December last year was its single biggest investment since it started venturing abroad in the 1990s.

"The excuse that there was a mystery competitor for Progress Energy is doubtful. Moreover, other multi-national corporations (MNCs) such as Shell had pulled back from bidding as they could not match the Petronas offer price," Rafizi (right) said in a statement.

"The identity of another bidder remains a secret and a question mark. What caused Petronas to raise its offer when there were no competitors?"

Rafizi noted that before Petronas started bidding for Progress Energy in July last year, the Canadian company's share prices had mostly traded around C$11, where it had remained since 2008. 

When the market caught whiff of Petronas’ intentions, Progress Energy's share price leaped and Petronas then confirmed that it was bidding C$22 (RM68) per Progress Energy share.

The deal was initially blocked by the Canadian government out of national concerns but was later approved.

Petronas has said it has shifted its focus overseas in recent years in a bid to acquire oil and gas reserves to replace Malaysia's own dwindling supplies.

The Pandan MP has this week been pressing for more details on the Canadian deal, after alleging that Petronas may have paid twicemore than the market price for the gas reserves. 

With the deal, Malaysia is set to be the biggest foreign investor in Canada. On top of buying Progress Energy, Petronas is due to pump in billions of ringgit more to build pipelines and export facilities to commercialise the shale gas beneath the rocks of British Columbia.

"There is a lack of transparency in this purchase. I will write a full report on this matter to Dr Mahathir Mohamad and Kadir Jasin so that they can help draw comments from the Petronas management and the prime minister," Rafizi said.