Suncor Energy to acquire working interest in Fort Hills project

This transaction sets a current market value for Fort Hills and Suncor will therefore recognise a non-cash accounting impairment charge on its existing 54.1% interest of approximately CAN$2.6 billion after tax in its 3Q22 results.

Kris Smith, Interim President and Chief Executive Officer, said:

"The acquisition of an additional interest in Fort Hills meets our return objectives, builds upon our strategy to optimise our portfolio around our core operated assets, and underscores Suncor’s confidence in the long-term value of the Fort Hills project. This acquisition is a part of our base plant mine replacement strategy”

"The company’s Mining and Upgrading and Fort Hills operating leadership teams have been conducting an in-depth review of the Fort Hills project and have developed and commenced a multi-year performance improvement initiative. This recognises the medium-term challenges in asset performance and drives the necessary actions focused on optimising production, operating costs and capital requirements over the long-term. In the next 36 months, the company expects 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."

“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.”

Read the article online at: https://www.globalminingreview.com/mining/27102022/suncor-energy-to-acquire-working-interest-in-fort-hills-project/