(Adds details and comment on potential sale, updates share
CALGARY, Alberta May 9 Canadian Natural
Resources Ltd, the country's largest independent oil
and gas producer, said on Friday it will consider spinning off
or selling its stream of royalty income from its wholly owned
lands in Western Canada, making it the latest Canadian energy
company to ponder the move.
Steve Laut, the company's president, said the company was in
the early stages of considering the spin-off of its royalty
income, which are payments from third-party oil and gas
production on its lands.
Spinning off such a royalty stream would offer Canadian
Natural cash up front, with the potential of retaining majority
control of that royalty stream.
However Canadian Natural is waiting to familiarize itself
with the additional royalty properties that came with its C$3.13
billion ($2.87 billion) April acquisition of Devon Energy Corp's
Western Canadian properties before making a final
decision on what to do with the money, which he estimates will
run between C$140 million and C$150 million in 2014.
"Once complete, we'll look at the options to monetize the
combined (Canadian Natural) and Devon royalty streams, which
could either be a direct sale or via a separate vehicle," Laut
said on a conference call. "We're targeting a decision for the
potential options for later this year."
The move follows on Encana Corp's decision earlier
this year to spin out its extensive royalty lands into a new
company, PrairieSky Royalty Ltd. Encana expects to raise as much
as $861.3 million from the sale.
Canadian Natural shares were down 14 Canadian cents to
C$42.86 on the Toronto Stock Exchange.
($1 = 1.0905 Canadian Dollars)
(Reporting by Scott Haggett; Editing by Jeffrey Benkoe and