OTTAWA -(Dow Jones)- UTS Energy Corp. (UTS.T) said Monday it will sell its 50% stakes in three oil sands leases in northeastern Alberta to Imperial Oil Ltd. (IMO) and Exxon Mobil Corp. (XOM) for C$250 million (US$231 million).
Shares of the Calgary-based oil company rose 4.9% to C$2.14 in recent trading in Toronto.
The company said the deal will mark the end of its successful campaign to increase shareholder value in order to fend off a hostile takeover attempt by Total SA (TOT) earlier this year.
UTS estimated after-tax proceeds from the sale of C$200 million, and expects the transaction to close over the next month. UTS said its cash reserves would reach C$440 million after the deal is complete, plus C$695 million in earn-ins owed to it by its Fort Hills Project partners, Suncor Energy Inc. (SU) and Teck Cominco Ltd. (TEK.A).
UTS acquired the leases in late 2006, and drilling found 24 sections with prospective oil reserves, but said it hadn't drilled the area enough to fully determine its potential.
Imperial Oil is a Calgary-based oil company that is developing the Kearl oil sands project in northeastern Alberta along with ExxonMobil Canada. ExxonMobil owns a majority stake of Imperial Oil.
-By Edward Welsch, Dow Jones Newswires; 613-237-0669; edward.welsch@dowjones.com