Canadian Natural Resources Limited, or CNRL, announced on Friday that it will purchase the Joslyn oil sands project for a total price of $225 million.  

Joslyn oil sands project owned by Total SA, partners

Canadian Natural Resources Limited, or CNRL, announced on Friday that it has purchased the Joslyn oil sands project, located directly south of the company’s Horizon Oil Sands Mining and Upgrading project.

The deal is valued at $225 million. According to CNRL, the company will pay $100 million on closing and make annual cash payments of $25 million over the next five years.

The Joslyn oil sand project “adds significant value to the company’s already extensive portfolio of high quality long life low decline assets and will allow for more effective lease-line development opportunities between the Horizon and Joslyn projects,” CNRL said in a press release.

Joslyn is owned by France’s Total SA and its partners.  In 2014, after the price of oil plummeted, Total and its partners put further developments of the project on hold, and since then have limited activity to fulfilling regulatory requirements and ensuring site safety.

“Reducing our exposure to Canada’s oil sands by selling this asset is in line with our global strategy to focus our oil investments on low breakeven resources and develop a resilient portfolio in the mid and long term,” said said Patrick Pouyanné, Chairman and CEO of Total.  He added “It is also consistent with the gradual reduction of our stake in the Fort Hills oil sands project in 2017“.

Total owns a 38.25 per cent stake in the Joslyn project, Suncor Energy holds 36.75 per cent, Joslyn Partnership owns 15 per cent and Inpex Canada has a 10 per cent stake.

The deal, subject to regulatory approval, is targeted to close on Sept. 28.