TotalEnergies finalizes $3bn sale of Surmont oil sands asset to ConocoPhillips

TotalEnergies EP Canada Ltd. has successfully completed the sale of its 50% stake in the Surmont oil sands asset and related midstream commitments to ConocoPhillips. The transaction, valued at a base amount of C$4.03 billion (approximately US$3 billion), with potential contingent payments of up to C$440 million (about US$330 million), carries an effective date of April 1st, 2023. After adjustments, TotalEnergies received a cash payment of C$3.7 billion (around US$2.75 billion) at the closing. If current WCS (Western Canadian Select) prices and production levels persist, TotalEnergies anticipates receiving the entire contingent payments within a year.

In addition to this landmark transaction, TotalEnergies has inked an agreement with Suncor to sell all shares of TotalEnergies EP Canada Ltd., encompassing its participation in the Fort Hills oil sands asset and linked midstream commitments. The consideration for this deal amounts to C$1.47 billion (approximately US$1.1 billion), with the closing expected before the end of 2023.

Jean-Pierre Sbraire, Chief Financial Officer of TotalEnergies, emphasized the strategic significance of these divestments, stating, “The disposal of our Canadian oil sands assets fits our strategy to focus our allocation of capital to Oil & Gas assets with low breakeven. As announced during our Investor Day on September 27th, proceeds from these divestments will be shared with our shareholders through $1.5 billion of buybacks in 2023, yielding an expected shareholder distribution of around 44% of our cash flow (CFFO) this year.”

These strategic moves reflect TotalEnergies’ commitment to optimizing its portfolio and delivering value to its shareholders, aligning with its forward-looking strategy in the ever-evolving energy landscape.