Suncor Energy selling North Sea offshore assets in deal valued at $1.2B

CALGARY - Suncor Energy Inc. has taken another step toward streamlining its business, signing a deal to sell its offshore assets in the North Sea to Equinor UK Ltd. in an agreement valued at about $1.2 billion.

The deal announced late Thursday comes after Suncor put the assets up for sale last year.

“The decision to sell our UK Exploration & Production business is a clear example of our commitment to optimize our asset portfolio,” interim CEO Kris Smith said in a news release.

The deal includes Suncor’s non-operated 29.9 per cent stake in the producing Buzzard field as well as its 40 per cent stake in the Rosebank development, which is operated by Norwegian multinational Equinor and located about 130 kilometres northwest of the Shetland Islands.

The transaction is expected to close in the middle of this year.

Suncor has been selling non-core assets to focus on its main oilsands and downstream businesses.

Last year, it announced it would sell its wind and solar assets to Canadian Utilities Ltd. for $730 million and in another deal agreed to sell its exploration and production assets in Norway for $410 million.

The company also considered the possible sale of its Petro-Canada retail chain, but announced in November it would keep the business as it was unlikely to receive the price it believes the chain is worth.

Suncor’s efforts to streamline its operations are part of an overall plan to boost performance at the Calgary-based energy giant. Last year, the company reached a deal with activist investor Elliott Investment Management LP, which had expressed frustration with the company’s lagging share price, safety record, and streak of operational challenges.

Suncor will also soon have new leadership, as Rich Kruger — who led Imperial Oil Ltd. as president and CEO from 2013 until 2019 — will become CEO on April 3.

Kruger was named to the post after a months-long search, and will replace Smith who has been doing the job on an interim basis since Mark Little resigned in July 2022 amid investor pressure.

This report by The Canadian Press was first published March 3, 2023.

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