Calgary, Alberta – A subsidiary of PetroChina will take a 60 per cent working interest in two oil sands projects in Alberta, equal to $1.9 billion. Athabasca Oil Sands Corporation (AOSC) entered into a series of agreements with PetroChina International Investment Company to acquire the stake in AOSC’s MacKay River and Dover oil sands projects.
The agreements also provide for certain financing arrangements for AOSC. The projects are located in the centre of the Athabasca area in northeastern Alberta and have been independently assessed to contain approximately five billion barrels of best case contingent bitumen resource.
“Oil sands projects are very capital-intensive long-term investments, and are difficult to fully finance in the traditional equity market,” said Bill Gallacher, chairman of AOSC. “AOSC therefore decided to look for joint venture partners, and these strategic joint venture arrangements with PetroChina, one of the world’s largest energy companies, can ensure that the MacKay River and Dover projects will be developed in a timely manner, which is excellent news for Alberta and the rest of Canada.”
As joint venture partners, AOSC and PetroChina intend to use common in-situ methods to develop their oil sands projects. AOSC has filed applications with Alberta’s Energy Resources Conservation Board for approval of two pilot projects within the project areas, and intends to file a regulatory application for the first 35,000 barrel-per-day phase of the MacKay River commercial project at the end of 2009.