Five thorny unknowns plaguing the oil patch as 2016 approaches

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Welcome to Unsolved Mysteries: Energy Edition.

It's often said markets hate uncertainty, though it is also true that markets only ever face uncertainty. Several key business, economic and political issues remain unresolved as a brutal year in the oil patch draws to a close.

Here are some thorny unknowns that markets are watching closely for resolution in 2016.

Encana's sale of U.S. shale assets

This was not a mystery until Tuesday. Encana said its $900-million (U.S.) sale of Colorado assets to the Canada Pension Plan Investment Board and Broe Group is delayed up to six months. The deal for the DJ Basin acreage had been expected to close by around now, and neither seller nor buyers are explaining the new timing.

Even though oil prices have deteriorated since October, Encana said all sides are still committed to getting it done. In fact, the buyers had increased their deposit. Encana shares had already fallen by more than half in the past year as oil and gas prices have tumbled. The stock sank another 5 per cent on Tuesday to a new low.

Alberta royalties

Premier Rachel Notley's royalty-review panel is slated to deliver its report early next year on how resource rents should be structured. It couldn't have deliberated during a more trying time.

Of all the NDP's policy aims, the oil industry was most bothered by the NDP's pledge to make sure Albertans get their fair share of the spoils.

In the months since the party won its majority, the sector's fortunes have dwindled to the point where weaker players are being forced to sell out.

At a business conference in November, panel member Peter Tertzakian said royalties could be cut to zero amid the global oil price war and some Canadian companies would still not survive. He was frank when he said some parts of the sector will be competitive under a new fiscal regime, while others will not. Investors and those who work in the industry are all nerves waiting to see which parts are most at risk.

Suncor's hostile bid for Canadian Oil Sands

The $4.3-billion (Canadian) battle, involving long-time Syncrude Canada partners, was initially supposed to have been sewn up by early December. Canadian Oil Sands managed to get the bid deadline extended under its shareholder rights plan, though regulators gave it just until early January, a month earlier than it had hoped.

Suncor contends it is best suited to own Canadian Oil Sands' 37-per-cent stake in Syncrude because of its financial wherewithal, stable dividends and expertise in wrestling oil sands projects into shape. The target says it's being low-balled, will bounce back lickety-split once oil prices recover and has the backing of numerous wealthy shareholders. As it stands, Suncor appears to have the upper hand as falling crude prices pressure would-be white knights. Its bid expires on Jan. 8.

The prospect of more takeover activity in the oil patch looks to be more certain, though, as more producers struggle to meet debt obligations.

Northern Gateway

Dickens could not have scripted a storyline with more hurdles, conflict and reversal of fortune. This time, it's the newly elected federal Liberals taking aim at Enbridge's conditionally approved bitumen pipeline to the West Coast. They're using a back-door ploy to do it and refuse to say if they are fully intent on burying the project deeper than any pipeline trench.

Enbridge had been trying to win over West Coast aboriginal communities while working through the long list of conditions attached to its 2013 approval when the feds committed to imposing a ban on oil tankers off the coast. Such a ban effectively renders an oil export pipeline useless. Perhaps Prime Minister Justin Trudeau will deliver some badly needed candour in 2016 and say if he is killing the project.

West Coast LNG

The mystery of when liquefied natural gas developers will give an unqualified go-ahead to a project lingers. In fact, it has deepened as the export market has become murkier with sputtering Chinese demand and increasing global competition. Meanwhile, energy companies are shelving multibillion-dollar project plans by the dozen. The prospect of a wave of Canadian gas exports may be turning into a cold case.