Statoil to Divest 100%-Owned KKD Oil Sands Projects

Statoil has signed an agreement to divest its 100 percent-owned Kai Kos Dehseh (KKD) oil sands projects in the Canadian province of Alberta to Athabasca Oil Corporation.

The transaction covers the producing Leismer demonstration plant and the undeveloped Corner project, along with a number of midstream contracts associated with Leismer’s production. Following this transaction, Athabasca will take over operatorship of Leismer and Corner and Statoil will no longer operate any oil sands assets. 

The total consideration of the transaction to Statoil is up to $624 million (CAD 832 million), which includes a cash consideration of $326 million (CAD 435 million) and $110 million (CAD 147 million) to be paid in the form of 100 million common shares in Athabasca. Statoil’s share position, constituting just below 20 percent of the equity in Athabasca, will be managed as a financial investment. In addition, up to $187 million (CAD 250 million) will be paid in a series of contingent payments.

“This transaction corresponds with Statoil’s strategy of portfolio optimization to enhance financial flexibility and focus capital on core activities globally, including offshore Newfoundland, Canada,” Lars Christian Bacher, Statoil’s executive vice-president for development & production international, said.

Statoil entered KKD through the acquisition of North American Oil Sands Corporation in 2007. The divestment will trigger an impairment of $500-550 million, excluding negative currency effects from the CAD-USD exchange rate at closing.

The effective date of the transaction is 1 January 2017. Closing is subject to the satisfaction of certain conditions precedent, including regulatory approvals.



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