ConocoPhillips Buys Remaining 50% Interest In Surmont

(RTTNews) - ConocoPhillips (COP) Wednesday announced that it has completed the purchase of the remaining 50% interest in Surmont from TotalEnergies EP Canada Ltd. for about $2.7 billion cash after closing adjustments, as well as future contingent payments of up to about $0.3 billion.

ConocoPhillips now owns 100% of Surmont and will continue as operator.

"Long-life, low sustaining capital assets like Surmont play an important role in our deep, durable and diverse low cost of supply portfolio," said Ryan Lance, chairman and chief executive officer. "This transaction enhances our returns-focused value proposition, improves our return on capital employed, lowers our free cash flow breakeven and is expected to deliver significant free cash flow for decades to come. We know this asset very well and plan to further optimize it while remaining on track to achieve our GHG emission intensity reduction goals."

The transaction is subject to contingent payments for a five-year term of up to approximately $0.3 billion representing $2 million for every dollar that WCS pricing exceeds $52 per barrel during the month.