Calgary's Sunshine Oilsands enters $250M joint venture
Unnamed partner provides cash and technology to develop two fields
Sunshine Oilsands Ltd., a Calgary-based company with significant holdings in the Athabasca oilsands near Fort McMurray, Alta., says it has struck a deal with an unnamed partner to invest $250 million in two of its fields.
Sunshine, which is listed in Hong Kong and Toronto, says it’s negotiating to form a 50-50 joint venture with an international partner that would provide cash and thermal enhanced recovery technology.
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The deal applies to Sunshine's Muskwa and Godin area oilsands leases and would help the company achieve 5,000 barrels per day from the two fields. Terms of the agreement have yet to be finalized.
At the same time, Sunshine is slowing work on its West Ells project near Fort McMurray until it can raise additional funding.
Flooding hits West Ells project
Heavy rain and flooding in the area have already put development of the site behind schedule and forced up costs of the project to approximately $525 million. Flooding in Calgary in June also delayed work as suppliers were not able to get equipment to the site.
The company says it will maintain staff at the West Ells site to continue with reduced work activities and to ensure safety of the worksite.
"We are confident that Sunshine’s extensive asset base and very advanced first project at West Ells will enable us to obtain commitments for necessary funding," Sunshine president John Zahary said in a statement.
Sunshine has secured about one million acres of oilsands leases in the area and engages in exploration, development and production of hydrocarbons.