Heavy oil in Canada
3 Aug 2005
Oil giant Total has made a cash offer to acquire all of the common shares of Deer Creek Energy for about $ 1.11 billion.
The friendly offer has been unanimously approved by the Board of Directors of Deer Creek Energy, which is to recommend the offer to its shareholders.
Deer Creek Energy has an 84% interest in the leases of the Joslyn Project in the Athabasca region of the Canadian Province of Alberta.
The Joslyn Project is estimated to be capable of producing around 2 billion barrels of bitumen over 30 years, the majority of which will be recovered using open pit mining techniques, although in-situ steam-assisted gravity drainage (SAGD) technology will also be used.
Production from the mine is scheduled to begin in 2010, eventually reaching 200,000 barrels of bitumen a day.
The acquisition is in line with Total’s strategy of expanding its heavy oil operations in the Athabasca region. The Group already owns a 50% interest in the Surmont SAGD project, 125 kilometres south of the Joslyn Project.
Total is already a player in extracting and converting heavy oil thanks to its 47% participation in the Sincor project, in Venezuela, one of the world’s largest developments of its type, which produces more than 200,000 barrels per day.
