Calgary-headquartered Suncor Energy has revealed a major change in Newfoundland and Labrador’s offshore oil sector, announcing the divestment of interests in three oilfields. The energy company stated on Sunday that it had struck a deal with UK-based Ithaca Energy to sell its ownership stakes in Terra Nova (48%), White Rose (40%), and West White Rose (38.6%) offshore assets.
The transaction involves an upfront cash payment of $1.2 billion along with a contingent payment of up to $350 million based on future oil prices, as confirmed by the company. Suncor’s CEO, Rich Kruger, highlighted that the move is aimed at enhancing long-term shareholder value by focusing on strategic opportunities aligned with their competitive strengths and vast oil sands resources.
Ithaca will take over investment commitments and future liabilities associated with the assets, including a regulatory well compliance program at Terra Nova starting in 2027 and the estimated abandonment and lease liabilities. The deal, effective from July 1, is projected to conclude early next year, subject to regulatory approvals, closing conditions, and partner consents. Suncor intends to retain its interests in N.L.’s Hebron and Hibernia oilfields.
In a separate statement, Ithaca expressed that the acquisition aligns with its growth strategy, marking its first international investment in Offshore East Coast Canada. Ithaca’s executive chairman, Yaniv Friedman, emphasized that the transaction supports their growth ambitions and aims to replicate success achieved in the UK Continental Shelf through disciplined international expansion.
N.L.’s Energy and Mines Minister Lloyd Parrott welcomed the development, noting Suncor’s strategic shift back to the oilsands and Ithaca’s expertise in challenging offshore environments. Parrott highlighted the positive signal the acquisition sends globally and expressed optimism for the province’s future. He emphasized Ithaca’s commitment to extending oilfield lifespans and collaborating with other firms to maximize operational efficiency.
Additionally, OilCo CEO Jim Keating praised the deal as a positive endorsement for the province’s offshore sector. Keating highlighted Ithaca’s expertise in late-life field development and anticipated growth strategies in the region. Noting the industry’s dynamic nature, Keating emphasized the potential for new ideas and increased risk appetite with the entry of a new player like Ithaca.
Fred Hutton, Liberal energy critic, acknowledged the common occurrence of companies divesting stakes in the industry but expressed surprise at the development. He underscored concerns about potential job impacts and pledged to raise the issue with Suncor and in the House of Assembly. Hutton viewed Ithaca’s significant stake as a positive sign for the province’s oil industry and welcomed the interest from a new player in the region.