Canada’s Teck eyes spinoff or divestment of Fort Hills oil sands stake
2022.09.29 11:30
© Reuters. FILE PHOTO: Visitors pass a sign of sponsor Teck Resources at the Prospectors and Developers Association of Canada (PDAC) annual conference in Toronto, Ontario, Canada March 1, 2020. REUTERS/Chris Helgren
By Nia Williams
(Reuters) – Canada’s Teck Resources (NYSE:) said on Thursday it could pursue a spinoff or divestment of its stake in the Fort Hills oil sands project if the value of the asset is not reflected in Teck’s share price.
The comments come a day after French company TotalEnergies, another partner in the Fort Hills mine in northern Alberta, said it is planning to spin off its oil sands assets to create a new company.
Fort Hills is an open-pit truck and shovel mine, where raw oil sands bitumen is extracted and then upgraded. Suncor Energy (NYSE:) is the majority-owner and operator of the mine, which started producing in 2018.
Teck owns a 21.3% stake that produces around 20,000 barrels per day, however the project has struggled with operational issues and the company had previously said it may sell its interest.
“We have been clear that if we don’t see the value of the Fort Hills asset reflected in Teck’s share price, we will pursue other options, which could include spinoff or divestment,” spokesperson Chris Stannell said in an email.
“Teck’s board is currently assessing options to identify the path forward which will create the most value for our shareholders.”
Stannell did not comment on whether Teck would collaborate with TotalEnergies to create a spinoff.
