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‘Virtually no drilling this summer’: Canada natural gas players fight for market share

As North American energy producers contend with a protracted downturn in oil, they're also grappling with a gas slump as mild weather exacerbates a glut of the heating- and power-plant fuel, pushing storage to a record high in Canada.

Seven Generations Energy Ltd. and Tourmaline Oil Corp. are being released on top inside a battle for market share in Canada’s natural gas industry as prices wallow near an 18-year low and drilling is forecast to achieve a virtual standstill come july 1st.

The Calgary-based companies, along with Arc Resources Ltd. and Peyto Exploration & Development Corp., are the type of growing gas increases the fastest in Canada inside a ranking of the top 20 producers by BMO Capital Markets, even while competitors such as Canadian Natural Resources Ltd. and Centrica Plc’s Direct Energy curb output within the rout.

“Tourmaline, Peyto, Seven Generations, they’ve cash costs well below current commodity prices,” said Greg Dean, who oversees $2 billion at CI Financial Corp.’s Cambridge Global Asset Management in Toronto, including holdings of Tourmaline. “They are winning a market share game.”

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