France's oil giant,
Total SA, is acquiring Calgary-based UTS Energy Corp. for about C$617 million ($510 million) in cash, giving it a stake in a mutlibillion dollar oil sands project in northern Alberta. The 20% stake in the Fort Hills Project comes
on the cheap compared to Total's other investments in the Athabasca region as oil prices have plummeted. Though, extracting these particular massive deposits requires more expensive techniques.
Petro-Canada holds a 60% stake in the venture, while Teck Cominco Ltd. holds 20%. Total's offer was unsolicited and could prompt Petro-Canada to place a bid. As
noted by Reuters, Teck may be interested in selling its stake to help it repay billions of dollars in debt it took on last year to buy Fording Canadian Coal Trust.
Total said its offer is about a 57% over the closing price of UTS' shares on Tuesday. Less than two months ago, it was reported that Total abandoned the idea of launching a C$19.7 billion bid for Canada's Nexen Inc. as oil prices were still sliding. Nexen also has operations in the Athabasca region. Over the next 10 years, Total Canada says on its Web site it will make a
$10 billion to $15 billion capital investment into Alberta's economy. -
Baz HiralalSee Total's deal announcementGo to the Reuters story
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