Oil-sands explorer Suncor Energy Inc., Calgary, (NYSE; Toronto: SU) has completed its acquisition of Calgary’s Petro-Canada (NYSE: PCZ; Toronto: PCA) for approximately C$19 billion (US$15.5 billion) in a stock-for-stock transaction, creating Canada’s largest energy company.

Including Petro-Canada’s year-end 2008 debt of C$4.75 billion and C$1.45 billion of cash on hand, the total deal value is approximately C$22.5 billion (US$18.3 billion).

The merged company retains the Suncor name, while maintaining the Petro-Canada brand in refined products. Suncor Energy becomes the fifth-largest North American-based energy company by market value.

Suncor offered 1.28 common shares per Petro-Canada share. Suncor shareholders own approximately 60% of the merged company.

Petro-Canada production for 2008 was 418,400 BOE per day including 59,900 bbl. from oil sands, 240,800 bbl. from oil, and 706 million cu. ft. of gas. Proved plus probable reserves were 2.35 billion BOE, with an additional 8.9 billion equivalent contingent resources for a total 11.27 billion BOE. Refining capacity was 255,000 bbl. per day.

Petro-Canada’s upstream operations consist of gas production in Western Canada and the U.S. Rockies; oil-sands production in northeastern Alberta; production offshore Newfoundland and Labrador; and E&P operations in the North Sea, Libya, Syria and Trinidad and Tobago. Western Canadian gas production averaged 562 million cu. ft. per day in 2008. U.S. Rockies gas production averaged 103 million per day from coalbed-methane fields in the Powder River Basin and in the Denver-Julesburg Basin.

Petro-Canada’s major oil-sands interests include a 12% ownership in the Syncrude joint venture, 100% ownership of the MacKay River in-situ bitumen development, a 60% ownership in and operatorship of the proposed Fort Hills oil-sands mining project, and extensive prospective oil-sands acreage. Petro-Canada estimated it had 1.2 billion bbl. of total oil-sands proved plus probable reserves, and 9.5 billion bbl. of total contingent and prospective oil-sands resources.

The merged company’s board includes eight members from Suncor’s board and four from Petro-Canada’s. John Ferguson, Suncor chairman, will serve as chairman of the merged board. The new company’s shares will trade on the Toronto and New York stock exchanges as SU.

CIBC World Markets and Morgan Stanley are financial advisors and Blake, Cassels and Graydon LLP are legal counsel to Suncor. RBC Capital Markets and Deutsche Bank are financial advisors to Petro-Canada while Macleod Dixon LLP is legal counsel.

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