Edmonton Journal from Edmonton, Alberta, Canada • 48

F2 TUESDAY, DECEMBER 18, 2007 BUSINESS EDMONTON JOURNAL RESOURCE SECTOR MERGER National Oilwell buys Grant Prideco for Oilfield equipment maker gets access to much-needed drilling hardware former on the 50. The acquisition is the biggest in the oilfield-services industry this year, where $43 billion in deals have been announced or completed worldwide, according to Bloomberg data. That compares with $27.3 billion for all of 2006. National Oilwell plans to finance the deal through cash and debt GrantPride-co's shareholders are expected tovoteon the deal late in the first quarter or early in the second quarter. Grant Prideco was spun off from Weatherford International the fourth-largest oilfield contractor, in 2000 and went public later that year.

National Oilwell was formed in 2005 when Na-tional-Oilwell Inc. acquired Varco International Inc. for $4.4 billion. Bloomberg National Oilwell Varco the largest U.S. maker of oilfield equipment, agreed to acquire Grant Prideco Inc.

for about $7.4 billion to gain drilling pipes and bits to tap deposits beneath the ocean floor, where the biggest reserves can be found. National Oilwell will pay $23.20 in cash and 0.4498 of a share for each Grant Prideco share, equal to $58 each, or 22 per cent more than the Dec. 14 closing price. Houston-based National Oilwell. The company, which builds derricks, pumps, motors and electronic equipment, fell 8.6 per cent, the biggest decline since Nov.

12. Both companies have major operations in Edmonton. The acquisition will give National Oil- bit and circulate fluids into a well, said Maxime Carmignac, who manages $18 billion at Carmignac Gestion in Paris, including shares of both companies. Rising oilfield spending by crude and natural-gas producers pushed National Oilwell's order backlog to $8 billion at the end of September from $7.2 billion at the end of June. National Oilwell said it expects cost savings of $40 million per year in the combined company.

National Oilwell is also getting Grant Prideco's "game-changing" piping that can transmit high-speed data from the wellhead to the surface, Read said. The system, commercially available since last year, can handle thousands of times well new products and the financial strength it needs to develop technology, chief executive officer Pete Miller told analysts on a conference call. Spending by producers to search for oil and gas next year is expected to rise 11 per cent to a record $369 billion, Lehman Brothers Holdings Inc. estimates. "National Oilwell gets one of the best drill-bit businesses and a drill-pipe business with a large market share," said Roger Read, a Houston-based analyst for Natixis Bleichroeder.

Grant Prideco, with 25 manufacturing sites around the world, controls 60 per cent of the global market for drill pipe, or the spinning pipes that turn a drill more information than the best method previously available, according to the U.S. Department of Energy. Faster data allows a driller to know more about conditions at the bottom of the hole to better direct the drill head and may reduce drilling frequency and costs, the department said. "I can't overemphasize the technological advantages they have in their businesses," Miller said of Grant Prideco. Grant Prideco rose 14 per cent, or $6.45, to $53.91 inNew York Stock Exchange composite trading.

National Oil-well fell $6.68 to $70.69. National Oilwell's stock has more than doubled this year, making it the best per BUSINESS BROWSER Or Lots of work ahead on carbon problem Get a jump on business news at the Edmonton Journal's website with a summary of top stories every weekday morning and updates throughout the day as news breaks. Go to www.edmontonjournal.com and look under Latest from The Journal. Light reading Quest gets $3M present' Edmonton Quest PharmaTech Inc. (TSXV: OPT) said Monday it will receive $3 million from a multinational technology company to develop oncology products based on its SonoLight Technology.

The investor, who wants to remain anonymous, will get 3 5 per cent of all future net revenue from the commercialization of the products, CEO Madi Madiyalakansaid. change, TSX Venture Exchange and several other alternative trading systems, will create a new, single, mtionalself-regulatoiyorgamzationformecounnVs securities industry. Nothing sells like a Trane new york Diversified manufacturer Ingersoll-Rand Co. Ltd. said it would buy Trane ma, a leading maker of heating and air-conditioning systems, for $10.1 billion US in cash and stock.

The deal places Trane value at $47.81 per share, a 28.5-per-cent premium over its Friday close of $3720. Ingersoll-Rand will pay $36.50 in cash and 0.23 share of its stock for each Trane share. With the acquisition of New Jersey-based Trane, formerly known as American Standard Cos, Bermuda-based Ingersoll-Rand said it expects its year. U.S. wont take foreign e-bets Washington The United States has reached a deal with the European Union, Japan and Canada to keep its Internet gambling market closed to foreign companies, but is continuing talks with India, Antigua and Barbuda, Macau and Costa Rica, U.S.

trade officials said. The decision is a disappointment for European online gambling companies who hoped a case brought by Antigua several years ago at the World Trade Organization gave them a foothold to get backin the US. market after being kicked out by Congress last year. 5 JJBW! n. jr.

LAMPHIER Continued from Fl Collectively, the group accounts for more than 100 million tonnes of CO2 emissions per year. Under terms of their proposed CCS system, those emissions could be cut by more than 20 million tonnes annually by 2020. That's akin to taking four million vehicles off the road. Further out, those reductions could hit 100 million tonnes a year, equivalent to 13 per cent of Canada's total current emissions. That's huge.

The project would cost billions, of course. On a per tonne basis, it would amount to a minimum of $45 per tonne. That's three times the slim 15 per tonne penalty major Alberta emitters must pay, starting Dec 31, under the province's current climate change plan. As Journal reporters Gordon Jaremko and Hanneke Brooymans have written, such a scheme faces other obstacles. Besides the upfrontcost, there's still no agreement on a cost-sharing formula between industry players and the federal and provincial governments.

That's months away. The key cost, accounting for 70 to 80 per cent of the total, would be to cover the actual capture of the CO2. Over and above that, oilsands producers, power plants and other backers would have to build cosdy pipelines and secure underground storage space to sequester the gas. There's also the issue of liability. With all that CO2 trapped in hundreds of potential underground storage sites, governments and industry players will have to decide who takes responsibility for securing it for generations to come.

But here's the thing. Such CCS systems are already in use elsewhere, including the southern U.S. and Europe. Secondly, with California leading the charge by more than a dozen U.S. states to impose low-carbon fuel standards in coming years, Alberta's oil-sands-dependent energy sector has no choice but to act.

To do nothing isn't an option. The clock is already ticking. What's more, for oilsands producers, the cost of CCS may not be as high as you'd think. According to QBC World Markets economist Benjamin TaL it amounts to about $1.25 per barrel. That's equal to about 1.7 per cent of the current price of light crude.

Finally, the CCS scheme gives both the feds and the Alberta government a golden opportunity to appease the oilpatch, which is still smarting from last year's decision to kill the income trust market by 2011, and the Stel-mach government's recent move to hike energy royalties by 2009. Think of it as required infrastructure for a new century. Whatever you call it, it's a way forward. Finally. glamphierthejoumal.canwest.com '1 can't ihinkof a rerhottday present to our shareholders than establishing an accelerated oncology development program.

"We are optimistic about the potential of both our oncology products and our dermatology program. Quest's lead oncology product, SL052, is expected of prostate cancer next year. It is also being evaluated for treatment of lung cancer and peritoneal carcinomatosis. Cancer data nets $5M Edmonton Oncothyreonlnc (TSX: ONY), formerly Biomira, has received a $5-million payment from partner Merck KGaA following the scheduled trans- fer of data on lead cancer drug Stimuvax to the German company. Merck is conducting a Phase 3 trial of the drug in 30 countries on patients with late-stage lung cancer.

"We are pleased with the progress of our collabora- tibn with Merck KGaA for Stimuvax, CEO Robert KirkmansaidL Wage fund backstops workers Ottawa A special fund that would allow workers caught in their employer's bankruptcy to collect up to about $3,000 in unpaid wages and vacation pay should be up and running in about six months. The unpaid worker's protection program, which already has $35 million of funding in place, has cleared the last legislative hurdles after several years of efforts by Conservative and Liberal governments. The program is part of broad bankruptcy legislation that passed the Senate last week and received royal assent on Friday. "This is an excellent Christmas present," said Ken Georgetti, president ofme Canadian Labour Congress, which has been pushing for wage protection for workers. Without such protection, workers typically recovered only 15 cents on the dollar of amounts they were owed by their bankrupt employer.

Their claims had lower priority than those of banks and other secured creditors, under bankruptcy laws, Georgetti said. The bankruptcy process also took two years, on average, for workers to recover even partial payment on their claims, according to government estimates in 2005. Nortel launches patent suit Nortel Networks is suing Vonage, the Internet phone operator, for alleged patent violation. The suit filed in a U.S. District Court in Delaware is the latest in a continuing battle between the two companies and related interests.

Nortel is alleging that Vonage violated nine patents on technology that delivers voice traffic over the Internet as well as related services, such as 911 and 411. Vonage has been the target of numerous patent suits from companies like Verizon and which caused BLOOMBERG NEWS A couple check out the specs on lamp bases displayed at the auction preview in the Thames Foyer at the Savoy Hotel in London on Monday. The Savoy, one of London's top hotels, is closing for a multimillion-pound refurbishment and will sell off some 3,000 items of furniture ahead of the refit, at an auction next week. significant issues for the alternative telecommunications carrier. Compton will look at selling calgary Compton Petroleum Corp.

said Monday it was puzzled by a demand from its biggest shareholder that it put itself up for sale, but added it will "fully consider'' the request Compton, a Calgary-based natural-gas explorer whose shares are off 20 per cent over the past 12 months, said in a release that its board will study a demand by Centennial Energy Partners that it review its strategic options, including a potential sale of the company. Centennial, whichholds 19.8percentof Compton's shares, said in a letter to management it doubted the company had a plan to boost its share price. However Compton said it was "puzzled by the shareholder's request and particularly with its timing and said its long-term strategy is sound. Investment watchdogs merge Vancouver Member firms of the Investment Dealers Association of Canada, a body that regulates the country's investment dealers, voted 98.3 per cent in favour of a merger with Market Regulation Services Inc, the association said. The merger with Market Regulation Services, which keeps an eye on activity on the Toronto Stock Ex- Miners not played out Toronto Several Canadian rrmeisshodd continue to generate strong cash positions over the next two years, despite expectations that base metal prices are set to decline, said UBS Investment Research.

Copper and zinc producers such as HudBay Minerals, Breakwater Resources, Anvil Mining, Inmet Mining, and Frontera Copper should all see cash positions by 2009 that amount to more than one-third of their current market capitalizations, UBS analysis indicates that base metal producers should realize significant cash flow generation over the next mo years even under ourprevailing UBS scenario of falling metal prices through 2008 and 2009," UBS analysts said in a note. Billionaire expands holdings calgary Billionaire Calgary financier Murray Edwards is expanding his empire by paying $39 million for a nearly one-third stake in wealth-management firm Jovian Capital Corp. Edwards, known for extensive energy, finance and sports interests, has agreed to buy 32.4 million Jovian shares at 80 cents each in a placement, allowing the company to pay down debt and make acquisitions, Jovian said on Monday. TriStar makes Sask. deal calgary TriStar Oil 8c Gas Ltd.

has entered into an agreement to acquire Arista Energy a private oU and gas producer, for a total value of $212 million including assumed net debt. TriStar, a Calgary oil and gas producer, said Arista's assets are focused in TriStar's core area of southeast Saskatchewan and consists of more than 2,250 barrels of oil equivalent of high-quality light oil. IFte: IS! Capital Loans Available, Wanted Computer Internet Consulting Commercial DevelopmentRenovations Computer Internet Sales Service CommercialIndustrial Equipment ContractorsSub-contractors CommercialIndustrial Property Courses Seminars Accounting, Financial Services Business Services Businesses for Sale or Lease Business Opportunities Ventures Distributors Franchises ImportExport Opportunities IndustrialCommercial Investments Office, Retail, Restaurant Equipment Office, Retail, Restaurant Space Oilfield Services Property Management Services Investments Janitorial Services Moving Hauling Networking SignsBanners Trade Fairs Warehouse, Storage, Shop Equipment Warehouse, Storage, Shop Space Investments Business Services Businesses for Sale or Lease Commercial Industrial Properly I Office, Retail i i Restaurant Space Commercial Industrial Property Wt have res. properties for individual investors, you can even use your RRSP's to purchase. Call Indy at Remax 938-4639.

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