Suncor Energy (TSX:SU), Canada's second-largest oil and gas producer, is buying Mocal Energy's 5% stake in the Syncrude joint venture for $730 million (roughly Cdn$920 million), and said it's also acquiring an interest in an offshore project in the Norwegian Sea.
As a result of the first deal, expected to close in the first quarter, Suncor's share in Syncrude rises to 58.74% from 53.74%. The other partners include Imperial Oil Resources with 25%, Sinopec Oil Sands Partnership with 9.03% and the Nexen Oil Sands Partnership with 7.23%.
Company has also bought into offshore project in the Norwegian Sea.The second transaction, to close in the second quarter, will see Suncor grab a 17.5% interest in the Fenja Development from Faroe Petroleum for $54.5 million, or about Cdn$68 million.
The Fenja field, discovered in 2014, is located in the Norwegian Sea, about 30 km. southwest of the Statoil-operated Njord field.
Production is planned to begin in 2021. Suncor's share of go-forward capital is estimated to be Cdn$280 million, based on the operator's gross projected development cost of 10.2 billion Norwegian kronor.
The news comes just days after Suncor's chief executive Steve Williams revealed the company was eying acquisitions, particularly among competitors hurting from substantial price discounts on their oil sands crude
The Calgary-based company has been an active buyer of oil sands assets as of late. In 2016, it acquired Syncrude partner Canadian Oil Sands for $6.6 billion in 2016 and then spent an additional $937 million to buy a stake from Murphy Oil. That transaction helped it increase its ownership in the mining project from 12% to 54%.