Suncor takes a controlling interest in the Syncrude Project
Suncor Energy has agreed to buy out Murphy Oil's 5% stake of the Syncrude operation for C$937 million. The addition of Murphy Oil's share of the oil sands mine gives Suncor an additional 17,500 bbl/day of light synthetic crude oil (SCO). The Syncrude mine is adjacent to Suncor's base plant operation north of Fort McMurray, AB.
Suncor's purchase now brings their share of Syncrude from 49% to 53.74%, making it the largest member of the consortium. Once the deal closes, the Syncrude Joint Venture will be broken down as follows:
- Suncor Energy @ 53.74%
- Imperial Oil @ 25%
- Sinopec @ 9.03%
- Nexen @ 7.23%
- Nippon Oil @ 5%
The transaction is effective April 1, 2016. The deal is subject to regulatory approval and expected to close by the year end.
Earlier this year, Suncor paid C$6.6 billion for Canadian Oil Sands' 37% share of Syncrude (approximately C$51,325 per barrel of SCO production). The deal with Murphy Oil works out to C$53,500 per barrel. Suncor executives are reiterated that the company has no desire to take over operation of Syncrude, which is currently operated by Imperial Oil/ExxonMobil.