In a bombshell press release this morning, Royal Dutch Shell (RDS/A) announced it was selling all of its oilsands mining operations in Canada. On the other side of the agreement, was Canadian Natural Resources (CNQ.TO, CNQ). The size of this deal is not portrayed in the price. The assets changing hands are massive. Just the 100,000 barrel Expansion 1 back in 2011 was huge.
A snippet of the size of these assets. The Expansion 1 project, at one point employed 10,000 people and was the largest construction project in Canada. That project was $14.3 Billion! That was only 40% of the production from AOSP. The existing Muskeg River mine was 155,000 barrels per day. This is a massive, massive project. As a comparison, about 5 new car factories could be built if they had to replace all 255,000 barrels with new capital.
Part of the $14.3 Billion for Expansion 1 was the Scotford upgrader which was included in this deal so without question, it's a massive win for CNQ. There is so much to this deal.
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