Suncor and Petro-Canada enter supply agreement
Posted: 11 December 2003
Suncor Energy Inc. and Petro-Canada announced today a long-term
agreement whereby Suncor will process at least 27,000 barrels per
day (bpd) of bitumen from Petro-Canada’s MacKay River operation
into sour crude and sell an additional 26,000 bpd of Suncor sour
crude production to Petro-Canada. The provisions of the agreement
are expected to take effect in 2008.
"This agreement is a win for both companies," said Rick
George, Suncor president and chief executive officer. "It’s
an excellent fit with Suncor’s strategy of building stable
markets for our products through long-term contracts. At the same
time, the plan to process bitumen supplied from Petro-Canada’s
MacKay River facility provides Suncor with more flexibility in feeding
our production growth plans."
The agreement calls for Petro-Canada to ship at least 27,000 bpd
of bitumen from its MacKay River oil sands facility to Suncor’s
oil sands facilities north of Fort McMurray where it will be processed
into approximately 22,000 bpd of sour crude oil on a fee for service
basis.
Those volumes will be combined with an additional 26,000 bpd of
sour crude purchased from Suncor and shipped to Petro-Canada’s
Edmonton refinery. Both the processing and sales components of the
agreement will be for a minimum 10-year term.
Specific pricing terms of the agreement vary according to market
conditions and, for commercial and competitive reasons, will not
be disclosed.
The agreement assumes that Suncor’s previously announced
oil sands expansion plans, some of which are subject to Board of
Directors’ or regulatory approval, will proceed.
For more information see http://www.suncor.com.
Posted by Richard Price,
Editor Pipeline Magazine
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