Suncor Acquires Teck’s Stake in Fort Hills Oil Sands Project

Canadian oil sands operator Suncor Energy will purchase an additional 21.3% working interest in the Fort Hills Project and associated sales and logistics agreements from Teck Resources for C$1 billion ($740 million). The transaction will increase Suncor’s share of the project to 75.4%. “[This] underscores Suncor’s confidence in the longterm value of the Fort Hills Project,” said Kris Smith, interim president and CEO for Suncor. “This acquisition is a part of our Base Plant mine replacement strategy.”

The company’s new mining and upgrading teams, along with Fort Hills leadership, have been conducting an in-depth review of the Fort Hills Project and have developed and commenced a multi-year performance improvement initiative. Suncor said the initiative recognizes the medium- term challenges in asset performance and drives the necessary actions focused on optimizing production, operating costs and capital requirements over the longterm. “In the next 36 months, we expect lower gross production and increased operating costs per barrel, each impacted by approximately 5% when compared to Suncor’s most recent corporate guidance for 2022, due to physical mine constraints as well as accelerated development of further mine pits for increased sustained long-term production,” Smith said. “While the Fort Hills mine has faced challenges in the early years of the mine life, including challenges due to government directed production shut ins, I have full confidence in our current mine plan assembled with fresh external mining perspectives.”

As featured in Womp 2022 Vol 11 -