This morning as ConocoPhillips released its fourth quarter results (a profit instead of a loss in the same period the year before), I was reminded of something I hadn’t thought about for awhile–the company’s nine per cent stake in Syncrude is still for sale.
ConocoPhillips announced the sale last year, and according to the Daily Oil Bulletin, vice-president of corporate affairs Clayton Reasor said today that the disposition process is going well.
“We started the sales process for our Syncrude interest and received quite a bit of interest on this asset.”
When the asset sale–which currently represents about 23,000 barrels per day and a share in a massive resource base (proved plus probable reserves of 4.9 billion barrels)–was announced, UBS Securities said majority shareholder Canadian Oil Sands Trust was among the most likely to take over ConocoPhillips’ share. Maybe. ConocoPhillips says the asset could bring them up to $4 billion.
Let’s take a look at Syncrude’s current ownership:
Canadian Oil Sands Trust: 36.74%
Imperial Oil: 25%
Suncor Energy (formerly Petro-Canada): 12%
ConocoPhillips: 9.03%
Nexen: 7.23%
Murphy Oil: 5%
Mocal Energy: 5%
Now I clearly have no idea which of these companies will buy ConocoPhillips’ stake, but I have to ask…why should it be one of the current owners at all? Just for fun, let’s speculate!
I’m going to say Total E&P Canada. Why, you ask? I think that the learnings the French supermajor could get out of an operating stake in Syncrude could be a nice asset for it to have as it looks to progress its own Joslyn mine.
Buying part of Syncrude would also give Total more production revenue from its oilsands interests.
Consider also that last spring Total launched a hostile bid for oilsands junior UTS Energy, mind you, at $834 million, substantially less than the $4 billion Conoco is expecting. Although that was almost a year ago, it did show that Total was interested in more oilsands mining property–why wouldn’t it be now?
A stake in Syncrude is one of the best oilsands mining assets one could buy. As the world’s fifth largest oil company, gathering the required cash wouldn’t be that hard, would it?
What do you think?
