EnCana Sells Remaining Interest in Syncrude Project
EnCana has agreed to sell its remaining 3.75 percent interest in the Syncrude project to Canadian Oil Sands Limited (Canadian Oil Sands) for approximately C$417 million.
In February 2003, EnCana sold an initial 10 percent interest in Syncrude to Canadian Oil Sands for approximately $1.070 billion. At that time, Canadian Oil Sands acquired an option to purchase, on similar terms and prior to year-end, EnCana's remaining 3.75 percent share and an overriding royalty. That option has now been exercised, bringing total proceeds from the sale to approximately $1.487 billion. The sale of the 3.75 percent interest is subject to normal closing adjustments. It has an effective date of February 1, 2003 and is expected to close on or about July 11, 2003.
"This divestiture of Syncrude exemplifies EnCana's focus on premium-growth, high-return assets. Our investments are targeted to high-working-interest, operated, conventional oil and gas properties where we believe we can efficiently apply our core competencies, manage the pace of development and achieve the lowest costs in industry," said Gwyn Morgan, EnCana's President & Chief Executive Officer.
"Despite our sale of these Syncrude interests, EnCana continues to have an ambitious growth plan for developing our leading position in in-situ oilsands. Our high quality oilsands investments will focus on our 100 percent owned and operated lands at Foster Creek and Christina Lake, where we are applying leading-edge steam-assisted gravity drainage (SAGD). By early in 2004, production is expected to grow to more than 30,000 barrels per day.
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