Shell has entered into an agreement with Osum Oil Sands Corporation, a private in-situ oil sands company, to divest its stake in the Orion Oil Sands Project for C$325 million (US$298 million). The project is located approximately 30 km north-west of Cold Lake in northern Alberta. The deal is expected to close on 31-July-2014.
· 100% operated working interest
· Producing commercially since 2007 using SAGD thermal heavy oil recovery technology
· Q1-2014 production of 6.7 Mbbl/d of bitumen from 22 well pairs
· Expected to have an economic life in excess of 25 years
Osum President and CEO commented: "The Orion Project is a first class operation that will provide Osum with significant current production and cash flow. In the longer term we believe that by linking Orion together with our nearby Taiga Project, Osum has a unique opportunity to build a significant production platform in the Cold Lake region."
Orion was one of several projects Shell acquired in 2006 as part of a C$2.4 billion acquisition of BlackRock Ventures. Shell has been looking to sell Orion since 2012 in order to focus on future oil sands growth from its Peace River area assets.
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