Marathon's Western Oil takeover approved |
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Tue, 16 Oct 2007 22:32
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HOUSTON (AP) - Energy company Marathon Oil Corp. said Tuesday it's received both regulatory and shareholder approval for its $5.5 billion acquisition of Western Oil Sands Inc., which gives it a stake in Canada's oil sands market.Marathon said the deal was approved by more than 99 percent of Western shareholders who voted at a special meeting Tuesday in Calgary, Alberta, where Western is based. Marathon received regulatory approval Monday.The deal is expected to close Thursday.When the proposed coupling was announced in July, the companies said shareholders of Western Oil would get $3.6 billion in cash and Marathon stock worth about $1.9 billion. Marathon also assumed $650 million of Western Oil's debt, valuing the total deal at roughly $6.2 billion.Marathon said the acquisition gives it a 20 percent interest in the Athabasca Oil Sands Project in Alberta currently held by Western Oil. Shell Canada Ltd. and Chevron Canada Ltd. hold the remaining 60 percent and 20 percent stakes, respectively.The benefit, Marathon has said, is immediate net production of about 31,000 barrels per day of bitumen, a thick oil. The Athabasca project, which includes facilities owned by the joint venture and third parties, mines the oil sands deposits and extracts the bitumen, which is upgraded to synthetic crude oil.Canada's western region is home to vast reserves of sands rich in oil, bitumen-tar or other thick petrochemicals.Marathon, the fourth-largest U.S. integrated oil company and the nation's fifth-largest refiner, has said its extensive operations in the U.S. Midwest position it well to tap into Canada's bitumen resources.Marathon shares rose 7 cents to $59.43 Tuesday. The shares have traded in a range of $41.29 to $67.04 in the past year.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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Shareholders ok Marathon buyout deal 