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Suncor (SU) Assumes Control of the Syncrude Joint Venture
Suncor Energy Inc. (SU - Free Report) recently announced that it took over as the operator of the Syncrude Joint Venture, a significant move toward increasing productivity and competitiveness across all its operations in the Regional Municipality of Wood Buffalo (RMWB).
The company's optimism surrounding the Syncrude asset is reflected in its operatorship, which has the full backing of the Syncrude joint-venture owners and was first announced in the fourth quarter of 2020. It is part of a long-term strategy to improve the Syncrude asset's service quality, efficiency and profitability.
Suncor purchased Canadian Oil Sands' stake in 2016 and has ever since engaged with the other owners to identify methods for its improvement. Through acquisitions, the energy player has increased its shareholding in Syncrude from 12% to 58.74% since 2016.
The Syncrude project was initiated by a group of partners with the currently Zacks Rank #3 (Hold) Suncor holding the majority interest in it. The remaining stakeholders include Imperial Oil Limited (IMO - Free Report) with 25% working interest while Sinopec and CNOOC Oil Sands Canada (CEO - Free Report) own 9% and 7% stake each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Syncrude is one of the first oil sand mining joint ventures and the biggest single-source producer of crude oil in Canada, which is stationed in the Athabasca oil sands near Fort McMurray, about 440 kilometers northeast of Edmonton. Suncor will start operating the mine as well as the connected upgrader with a capacity of 350,000 barrels of oil per day by the end of 2021. The company’s other oil sand ventures include the Fort Hills project, its Base Plant and other steam-based operations.
Suncor’s operatorship marks the evolution of the oil sand mining industry from a risky, high-valued venture to a more powerful and predictable operation. The energy company is committed toward successful oil sand development and provides the energy capacity that Canada needs.