On June 3rd, Suncor Oil Sands (02012.HK) surged by 152.94%, ranking first in the Hong Kong stock market's gain list. The company closed at 0.86 Hong Kong dollars per share, with a market value of 209 million Hong Kong dollars.
The stock price surge is related to an announcement regarding a proposed acquisition of assets. Suncor Oil Sands announced before the market opened today that it has entered into a memorandum of understanding with挪宝能源控股 to possibly acquire equity in its subsidiary from挪宝能源控股.
The announcement shows that the main business of挪宝能源控股 is to use leading shallow geothermal high-temperature heat pump technology to replace traditional coal and gas energy heating methods, providing heating and cooling services based on integrated energy-saving and environmental protection green energy technology, investment, construction, and energy management for customers in northern China.
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It is reported that the potential acquisition target company (its subsidiary) has multiple long-term operation management agreements, with stable revenue and cash flow. In addition, if the acquisition proceeds smoothly, the above heat pump technology can also be used in Suncor Oil Sands' oil production in Canada, which can effectively enhance the company's existing extraction technology, significantly reduce cost expenditures, and enhance future competitiveness in the North American market.
Public information shows that Suncor Oil Sands is headquartered in Calgary, western Canada, and was listed on the Hong Kong Stock Exchange in early March 2012. The company focuses on developing its oil sand leases in the Athabasca oil sand region and is the rights holder and developer of oil sand resources in the Athabasca region.
In terms of performance, in the first quarter of 2024, Suncor Oil Sands recorded a loss of approximately 22.144 million Canadian dollars after deducting license fees from oil sales revenue of 11.192 million Canadian dollars. Oil sand development is a capital-intensive business, and the price fluctuations in the oil and gas market are quite large, easily affected by various factors such as the global economic situation, supply and demand relationships, and geopolitical factors. Historically, the company's profitability has been unstable.
In addition, since mid-April of this year, the international oil price trend has been weak, mainly affected by the lower-than-expected US economy. During the same period, the Citi US Economic Surprise Index hit a new low in the past year, which may have a certain impact on the company's subsequent performance.
On June 2nd, OPEC+, led by Saudi Arabia and Russia, decided to extend the voluntary production cut of 2.2 million barrels per day announced in November 2023 until the end of September this year. In addition, it also extended the voluntary production cut of 1.65 million barrels per day announced in April last year until the end of 2025.
Zhengxin Futures stated that since the OPEC+ extension of production cuts was expected, the meeting results did not provide significant support for crude oil, and the overall market was more bearish than bullish, with short-term oil prices under pressure. However, on the other hand, the peak season for gasoline demand is approaching, which still supports oil prices.