By Laura Goldberg and Don Mason
In part of an ongoing asset sale, ConocoPhillips is selling a 226,000 acres of Canadian oil sands property to Exxon Mobil Corp. interests for $720 million, the companies said Thursday.
The transaction involves ConocoPhillips’ entire stake in the Clyden oil sands about 100 miles south of Fort McMurray, Alberta.
The property is part of the Athabasca Region, where Houston-based ConocoPhillips said its 1.1 million net acres, with an estimated 16 billion net barrels of resources, is one of the largest positions in the area.
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Imperial Oil, an integrated petroleum company based in Calgary, Alberta, said it will purchase a 27.5 percent interest in the ConocoPhillips property, and ExxonMobil Canada, part of Irving-based Exxon Mobil, will buy 72.5 percent.
Bloomberg News reported that Exxon Mobil is Imperial’s largest shareholder, with a 70 percent stake.
“This transaction is a significant step toward rebalancing our world-class oil sands portfolio,” Don Wallette, ConocoPhillips executive vice president for commercial, business development and corporate planning, said in a company news release. “We are pleased Imperial Oil and ExxonMobil Canada recognize the value of the Clyden asset.”
Fadel Gheit, senior analyst covering oil and gas for Oppenheimer & Co., agreed that the deal is good for buyer and seller.
ConocoPhillips, Gheit noted, is using the proceeds from its ongoing sales of non-core assets to return cash to shareholders through dividends and stock buybacks.
Exxon Mobil, he said, is working to add assets that will keep producing long-term, and unconventional resource plays such as the oil sands are part of that strategy.
“ConocoPhillips booked a profit, so they are happy and Exxon Mobil usually doesn’t overpay, so they are happy,” Gheit said.
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Subject to regulatory approvals, ConocoPhillips said it expects the deal to close by the end of September.
Including the deal announced Thursday, the company said, it expects $13.8 billion in proceeds from its 2012-2013 asset disposition program.
Now an independent exploration and production company, ConocoPhillips spun off its downstream assets into a new company, Phillips 66, in May of 2012.
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