The acquisition of TotalEnergies EP Canada will provide full ownership of the Fort Hills project and add 61,000 barrels per day of net bitumen production capacity and 675 million barrels of proved and probable reserves to Suncor’s existing oil sands portfolio
Canada-based integrated energy company Suncor Energy has completed its previously announced acquisition of TotalEnergies EP Canada for a total of C$1.47bn (around $1.1bn).
Fort Hills Ore Preparation Plant crushers. (Credit: Suncor Energy Inc.)
The acquisition includes the remaining 31.23% working interest in the Fort Hills oil sands asset and associated midstream commitments.
With the closing of the acquisition, Suncor now fully owns the Fort Hills Project, located in Alberta’s Athabasca region, 90km north of Fort McMurray.
Also, the acquisition adds 61,000 barrels per day of net bitumen production capacity and 675 million barrels of proved and probable reserves to Suncor’s existing oil sands portfolio.
Suncor president and CEO Rich Kruger, during the agreement signing, said: “The transaction secures additional long-term bitumen supply to fill our Base Plant upgrades at a competitive supply cost, addressing a key uncertainty for the company and adding long-term shareholder value.
“With 100% ownership of Fort Hills, we will pursue opportunities to create additional value through regional synergies and basin-wide management of our unparalleled, integrated oil sands asset base. This transaction is aligned with our strategy to wholly own and operate long-life strategic assets.”
TotalEnergies has received a cash payment of C$1.83bn (about $1.3bn) at closing, which is effective 1 April 2023.
Last month, TotalEnergies completed the sale of its 50% stake in Surmont and related midstream assets to US-based oil and natural gas company ConocoPhillips.
The French energy and petroleum company received a cash payment of C$3.7bn ($2.75bn) and is eligible for future contingent payments totalling up to C$440m ($330m).
TotalEnergies chief financial officer Jean-Pierre Sbraire said: “With these two divestments over the last couple of months, TotalEnergies effectively exits the Canadian oil sands, focusing our allocation of capital to oil and gas assets with low breakeven.
“The company has hence received more than $4bn from these sales during the fourth quarter 2023, out of which, as previously announced, $1.5bn will be shared with shareholders as buybacks in 2023.”