Oil Slump Makes Energy Attractive to Canadian Pensions

Andre Bourbonnais, Chief Executive of Canada’s Public Sector Pension Investment Board, said on Tuesday that the current oil slump is piquing the Board’s interest in the energy sector.

A few of Canada’s other large pension funds appear to think the same.

PSP is Canada’s fourth largest pension fund.

More details from Reuters:

The Public Sector Pension Investment Board, one of Canada’s 10 largest pension fund managers, is considering entering the oil and gas sector, as weak crude prices create opportunities for long-term investors, said Chief Executive Andre Bourbonnais.

“It’s one asset class we’re looking into,” Bourbonnais told media in Montreal on Tuesday. “We do not currently have the internal expertise really, so we’re trying to look at how we’re going to build it first.”

Last week, the head of Healthcare of Ontario Pension Plan (HOOPP) expressed a similar sentiment, stating the prolonged weakness in energy prices is making valuations in the oil and gas attractive and revealed HOOPP is considering upping its investments in Canadian equities in response.

The interest mirrors that of larger Canadian pension funds such as Canada Pension Plan Investment Board (CPPIB) and Ontario Teachers’ Pension Plan Board.

[…]

Bourbonnais, who joined PSP earlier this year from CPPIB, said he does not think oil prices have come close to hitting bottom.

“I think these markets have a ways to go,” said Bourbonnais, who was previously global head of private investments at CPPIB, one of Canada’s most-active dealmakers with over C$272 billion ($198 billion) in assets under management.

PSP manages $81.6 billion in assets.

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