Suncor and partners announce restructuring plan for Terra Nova

Suncor has reported that it has joined Cenovus and Murphy Oil in enlarging its holdings in the Terra Nova offshore oil facility. Last week, Calgary-based Suncor announced that the co-owners of the Terra Nova Floating Production, Storage and Offloading (FPSO) facility, and the associated Terra Nova Field (“Terra Nova”) had finalized an agreement to restructure the project ownership and move forward with the Asset Life Extension Project. Suncor, Cenovus and Murphy Oil, now control 100% of the project with the following increased ownership positions: Suncor – 48% (previously approximately 38%); Cenovus – 34% (previously 13%); and Murphy Oil – 18% (previously approximately 10%).

“The decision to move forward with the Terra Nova project is a concrete example of Suncor’s commitment to invest in projects that have strong economic returns and will provide long-term value for investors. This agreement also provides certainty for the 1,000 plus local direct and indirect jobs that support the project,” said Mark Little, Suncor president and CEO.

The agreement includes the previously disclosed royalty and financial support from the Government of Newfoundland and Labrador, including up to $205 million, on a matching contribution basis, to support local onshore and offshore work related to the Asset Life Extension Project. The Asset Life Extension Project will extend the production life of the facility by approximately 10-years and provide an additional 70-million barrels of resource for the partnership.

The FPSO will undergo maintenance work at the Bull Arm Fabrication site starting early September before sailing to dry dock in Ferrol, Spain, later this year, with a safe return to operations anticipated before the end of 2022.