Fort Hills Energy Limited Partnership, which includes Petro-Canada, Teck Cominco Ltd. and UTS Energy Corp., said Monday it is putting off a decision on an oilsands mine.

A decision on the oilsands mine near Fort McMurray, Alta., was to have been made by the end of this year, but the partnership said it would a defer a final decision "until a cost estimate consistent with the current market environment can be established." The group said a decision is now expected in 2009.

The partnership said a decision on a proposed upgrader is also on hold, with no future date given for a decision.

Tumbling oil prices, which have fallen from almost $150 US a barrel down to less than $60 US a barrel, coupled with tight financial markets and weak economic conditions, have led many companies to cut or reduce their spending on oilsands projects.

"We're giving ourselves some breathing room on the project schedule, so we can take advantage of a softening market to reduce costs," said Ron Brenneman, president and chief executive officer of Petro-Canada, in a statement.

Petro-Canada has a 60 per cent interest in Fort Hills, while UTS and Teck Cominco have 20 per cent each.