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Suncor increases stake in Syncrude oilsands project

A dump truck works near the Syncrude oil sands extraction facility near the city of Fort McMurray, Alta., on June 1, 2014.
A dump truck works near the Syncrude oil sands extraction facility near the city of Fort McMurray, Alta., on June 1, 2014. THE CANADIAN PRESS/Jason Franson

CALGARY – Suncor Energy is buying another chunk of Syncrude in a $937-million deal that will give it majority control over the massive oilsands project.

The Calgary-based energy giant said Wednesday it has reached a deal to buy Murphy Oil Corp.’s five per cent stake in the mine north of Fort McMurray, Alta.

The deal will increase its interest in Syncrude from just under 49 per cent to nearly 54 per cent.

WATCH: Suncor Energy buys Canadian Oil Sands for $6.6 billion

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Suncor Energy buys Canadian Oil Sands for $6.6 billion – Jan 18, 2016

Suncor completed its acquisition of another Syncrude partner, Canadian Oil Sands, last month following a bitter hostile takeover battle that came to a peaceful resolution in January.

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The $6.6-billion COS acquisition, which included the target company’s debt, increased Suncor’s Syncrude stake from 12 per cent to 49.

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Suncor, which has vast holdings elsewhere in the oilsands, has made no secret of its intention to scope out bargain deals during the prolonged downturn in oil prices.

“This transaction is a strategic fit for our portfolio given the quality of the resource, our existing interest in Syncrude and the potential for value creation,” CEO Steve Williams said in a release.

The deal increases Suncor’s oilsands production capacity by 17,500 barrels a day.

READ MORE: Shareholders press Suncor on climate policy and political lobbying

“This growth gives us even more leverage to oil prices as they recover,” said Williams.

The deal is expected to close by the end of June, provided it receives approval from the Competition Bureau, among other conditions.