AOSPL is the exclusive transporter of synthetic oil production from Syncrude Canada Ltd.'s plant, near Fort McMurray, Alberta, to Edmonton. The 430-kilometre pipeline currently transports about 220,000 barrels of oil per day under a long-term transportation agreement with the Syncrude participants. AEC has a 13.75 percent interest in Syncrude. Transportation charges on Syncrude production will not be impacted by the sale.
"The agreed to sale of AOSPL follows the recent sale of our Jonah Gas Gathering System in Wyoming. The realization by AEC from these transactions will total close to $800 million and underscores the value of AEC's midstream assets. These sales will have only a modest impact on the future income from AEC's remaining core midstream assets," said Hector McFadyen, President of AEC Midstream. As of Sept. 30, 2001, AEC's midstream assets had a book value of $2.9 billion and are forecast to generate $300 million in operating cash flow in 2001.
The AOSPL sale further strengthens AEC's financial position. On a proforma basis at September 30, 2001, AEC's upstream debt to capitalization is 34 percent and upstream debt to cash flow, on a trailing 12-month basis, is 1.1 times. AEC's midstream debt to capitalization remains unchanged at 60 percent. In addition, AEC has cash and unused bank lines of $2.7 billion.
Most Popular Articles
From the Career Center
Jobs that may interest you