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Suncor Energy To Buy Additional Interest In Syncrude JV For $730 Mln

Suncor Energy Inc. (SU.TO,SU) said it has reached an agreement to acquire Mocal Energy's 5 percent interest in the Syncrude joint venture for $730 million, or approximately C$920 million, subject to closing adjustments.

The transaction will be effective as of January 1, 2018 and is anticipated to close in the first quarter of 2018. Through this transaction Suncor's share in the Syncrude joint venture will increase from 53.74 percent to 58.74 percent.

Subsequent to the successful close of this transaction, the joint venture partners will be Suncor with a stake of 58.74 percent, Imperial Oil Resources with a stake of 25 percent, Sinopec Oil Sands Partnership with a 9.03 percent stake, and Nexen Oil Sands Partnership with a stake of 7.23 percent.

In addition, Suncor said that it's wholly owned subsidiary, Suncor Energy Norge AS, has acquired a 17.5 percent participating interest in the Fenja Development from Faroe Petroleum plc (FPM.L) for $54.5 million, or about C$68 million, subject to closing adjustments.

The transaction is effective January 1, 2018 and is expected to close in the second quarter of 2018.

The Fenja field was discovered in 2014, in the Norwegian Sea, approximately 30 kilometres southwest of the Statoil-operated Njord field. The development concept is a subsea tie-back to the Statoil-operated Njord platform.

Production is planned to start up in 2021. Suncor's share of go-forward capital is estimated to be C$280 million, based on the operator's gross projected development cost of 10.2 billion Norwegian kronor.

Subsequent to the successful close of this transaction, the joint venture partners will be operator VNG Norge with a 30 percent stake, Point Resources with a 45 percent stake, Suncor with a stake of 17.5 percent, and Faroe Petroleum with a stake of 7.5 percent.

by RTT Staff Writer

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