Feb. 1 (UPI) -- Norwegian energy major Statoil said it closed on the sale of its entire oil sands operations in the oil-rich Canadian province of Alberta.
Statoil said it completed the sale of its oil sands division to Athabasca Oil Corp.
"Statoil has received $329 million in cash, following customary closing adjustments, plus 100 million common shares in Athabasca, representing just below 20 percent of the equity in the company," the company stated.
The cash deal extends to the Leismer thermal oil project in Alberta, which was producing about 24,000 barrels of oil per day when the deal was announced last year. Athabasca said the deal gives it a stronger base of production of around 40,000 barrels of oil equivalent estimated for 2017.
Both companies said the project has enough reserves in place to keep production static for the next 30 years.
"Leismer immediately drives a larger cash flow base and accelerates the company's transition to sustainable free cash flow generation which is expected in 2018," the Canadian company said in a separate statement.
The Norwegian company took full ownership of the Leismer oil sands project in Canada in 2014. Critics of Canadian oil sands production argue it's more carbon intensive to produce than other, lighter crude oil grades. A steam injection method used by rival Canadian Natural Resources Ltd. to warm viscous oil ran out of control more than two years ago, causing long-term seepage in Alberta.
Statoil said it may receive up to $190 million in contingent payments over the next year from the deal. The company said the deal is part of its effort to optimize its portfolio by focusing on core activities.
Alberta is at the heart of the Canadian oil sector, which is recovering after wildfires last year idled about 1 million barrels per day worth of oil production.