Wednesday, September 3, 2025

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Cenovus And Indigenous Partners To Rival Strathcona’s Unsolicited Bid For MEG Energy

Cenovus Energy (TSX: CVE) is in talks with a consortium of Canadian Indigenous groups to mount a joint bid for MEG Energy (TSX: MEG), a move that would create an immediate alternative to Strathcona Resources’ (TSX: SCR) unsolicited offer.

The Indigenous partners, including Chipewyan Prairie First Nation and Heart Lake First Nation, are negotiating to take a $2 billion stake backed by federal and provincial financing, while Cenovus would bid for the remainder.

People familiar with the process say a joint offer could come as early as September, though the talks could still fall apart.

If completed, this would mark the first large, direct Indigenous equity stake in an oil-sands producer. It would pair two Calgary-based operators with overlapping footprints in northeastern Alberta. MEG’s Christina Lake asset spans roughly 200 km² and holds approvals to produce about 210,000 bpd.

The approach follows months of pressure from Strathcona which launched an unsolicited cash-and-stock bid in May valuing MEG at $5.9 billion after building a 9.2% position. MEG’s board urged shareholders to reject the offer and began a strategic review to seek superior proposals.

Strathcona’s Adam Waterous pushed back at the prospect of taxpayer support for a rival bid. “We would be highly surprised if Canadian governments are considering subsidizing a partnership between a private sector company and Indigenous groups to make a bid for MEG Energy,” he wrote, adding that any government backstop would be “a direct subsidy to the private sector partner.”

MEG rose as much as 2.9% before closing at $26.20 on Tuesday. Bloomberg’s math puts Strathcona’s current offer value near $26.30 per MEG share, up from about $23.27 in May when it launched.

Strategically, Cenovus operates next door to MEG at Christina Lake and produced roughly 800,000 boe/d last year, predominantly bitumen.


Information for this story was found via Bloomberg and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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