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| A map showing Athabasca's oil sands properties, including Birch and Hangingstone. Map from Athabasca's website. |
It looks like Kuwait Petroleum, Kuwait's state owned oil company, is close to signing a deal with Athabasca Oil Corporation (formally Athabasca Oil Sands Corporation). The deal would be for a $4 billion joint venture on Athabasca's Hangingstone and Birch properties. The companies have apparently signed a letter of intent on the matter.
This seems like a lot of money for properties with unproven production, especially since Athabasca itself seemed to think of them as second string properties after Dover and MacKay. That said, without knowing what percentage this $4 billion would buy it's hard to comment on how reasonable the deal is.
Athabasca has been involved in partnerships with foreign state owned companies almost since its inception. Up to now, however, it has been Chinese companies, first when it sold 60% of the Dover and MacKay projects to PetroChina for $1.9 billion in 2010 and then when it sold the remaining 40% of MacKay to the same company for $680 million late last year. MacKay thus became the first oil sands project completely controlled by a Chinese company, which raised its share of eyebrows.
This deal with Kuwait may not go through, and Kuwait Petroleum seems to be telling everyone to calm down and not take any agreement for granted.
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