Malaysia’s state-owned energy giant, is weighing options for its Canadian subsidiary, formerly known as Progress Energy Resources Corp., including a potential full or partial sale, according to sources familiar with the matter.

The company is working with a financial adviser to assess strategic alternatives for the Canadian unit, which could be valued between $6 billion and $7 billion. A minority stake sale is also under consideration, contingent on buyer interest and valuation. Preliminary discussions with prospective investors have already begun, sources say, though no final decisions have been made. Petronas has yet to comment publicly on the matter.

Petronas acquired Progress Energy in 2012 for $5.3 billion to expand its position in North American shale gas and strengthen its global gas supply portfolio. The Canadian business is anchored in British Columbia’s North Montney basin, with over 800,000 gross acres of mineral rights and 53 trillion cubic feet of reserves and contingent resources, according to the company.

The review comes amid a tougher operating environment. Petronas reported a net income drop of more than 30% in 2024 due to weaker oil prices and recently announced job cuts to be implemented this year.

The Canadian unit also ties into Petronas' broader LNG ambitions. The company holds a 25% stake in the LNG Canada project—one of the country’s most significant liquefied natural gas ventures—alongside Shell, PetroChina, Mitsubishi, and Korea Gas Corporation.

A sale or equity partnership could reposition Petronas strategically while unlocking capital in a high-potential asset at a time of heightened focus on fiscal discipline.

Petronas Mulls $7 Billion Divestment of Canadian Energy Business

Malaysia's state-owned energy giant Petronas is evaluating a potential $6-7 billion sale of its Canadian subsidiary, Progress Energy Resources Corp., which it acquired in 2012 for $5.3 billion. The subsidiary, based in British Columbia, holds significant reserves and is part of the LNG Canada project. The move follows a 30% drop in Petronas' 2024 net income due to weaker oil prices and planned job cuts.