Shares in Canadian oil producer PetroKazakhstan have jumped up 17% in response to the company's confirmation that it was in talks with potential buyers or partners.
PetroKazakhstan is engaged in oil procurement in the former Soviet state of Kazakhstan and as such represents an attractive proposition for Russian, Chinese and other local oil companies. Russian oil titan Lukoil is considered a front runner for PetroKazakhstan as it already operates a joint venture with the Canadian outfit.
A successful bidder is expected to pay in the region of $3 billion and would acquire 550 million barrels of proved and probable crude oil reserves, located in the South Turgai Basin in south-central Kazakhstan.
In confirming its plan, the company said it was evaluating approaches from a number of different parties regarding a potential corporate transaction involving either an acquisition or a merger. However, the oil producer added that no firm deal has been reached.
The news has stimulated a 17.35% increase in PetroKazakhstan shares on the New York stock exchange, boosting its price to $38.15 per share.