Suncor Buys TotalEnergies’ Canadian Oilsands for $6.1B

According to the French company, TotalEnergies, they have reached an agreement with Suncor Energy Inc. to sell their Canadian operations for up to $6.1 billion.

The terms of the agreement call for Suncor to pay $5.5 billion in cash, with an extra $600 million conditional on the price of Western Canadian Select benchmark oil and the achievement of predetermined production goals.

For the Fort Hills oilsands project, TotalEnergies EP Canada Ltd. owns a 31.23% working interest, and for the Surmont in situ asset, the company holds a 50% working interest.

Suncor claims that the acquisition will increase its oilsands portfolio by 135,000 bpd of net bitumen production capacity and 2.1 billion bpd of proven and probable reserves.

After announcing last year that it would leave the Canadian oilsands by spinning off TotalEnergies EP Canada, TotalEnergies said it has changed its plans and will instead sell the operations after receiving multiple unsolicited proposals, including one from Suncor.

Rich Kruger, CEO of Suncor, argues that the acquisition is a strategic fit and will increase long-term shareholder value due to the company’s presence in the oilsands.