CALGARY, Aug. 29 /CNW/ - Canadian Oil Sands Trust advises that it has increased its credit facilities to $490 million and sold forward approximately 30% of its anticipated production for calendar years 2002 and 2003 as well as approximately 15% of its anticipated production for calendar 2004. Coupled with the recent issue of US$250 million Senior Notes earlier this month, Canadian Oil Sands has significantly improved its capability to fund its share of Syncrude's $4.1 billion stage 3 capital spending plans under a variety of oil prices. Stage 3 is expected to increase Syncrude's daily productive capacity to 365,000 barrels by the end of 2004 as well as improve the quality of its light oil production known as Syncrude Sweet Blend.
Canadian Oil Sands' credit facilities are comprised of three facilities: $300 million in a three year extendible revolving facility, $150 million in a 364 day extendible facility which converts to a two year term loan if not extended and $40 million in a two year extendible revolving facility. These facilities may be reduced at any time by Canadian Oil Sands and are intended to finance its share of Syncrude's future capital expenditures as well as general working capital requirements.
Canadian Oil Sands has also extended its crude oil price hedging in an effort to further reduce its exposure to fluctuating oil prices during stage 3 capital spending. The following summarizes Canadian Oil Sands' oil price hedging contracts for calendar years 2002 through 2004:
- Fixed price contracts at an average price of approximately US$24.95 per barrel with respect to 16,000 barrels per day throughout 2002;
- Fixed price contracts at an average price of approximately US$23.10 per barrel with respect to 16,000 barrels per day throughout 2003; and,
- Fixed price contracts at an average price of approximately US$22.00 per barrel with respect to 8,000 barrels per day throughout 2004.
Canadian Oil Sands intends to fund a significant portion of its future capital spending with debt thereby freeing additional operating cash flow for distribution to unitholders. Canadian Oil Sands' distributions will continue to reflect fluctuations in commodity prices, the Syncrude Project's operating performance as well as Canadian Oil Sands' intention to maintain its investment grade credit rating.
On July 5, 2001, Canadian Oil Sands Trust emerged from the merger of Athabasca Oil Sands Trust and the former Canadian Oil Sands Trust. The combined trust is Canada's largest oil and gas royalty trust holding a 21.74% working interest in the Syncrude Project with approximately 57 million trust units publicly held by investors in Canada and internationally. The trust units are traded on the Toronto Stock Exchange.
Certain information included in this Press Release with respect to future periods is Canadian Oil Sands' best estimate of future events and is based upon assumptions and anticipated results that are subject to uncertainties. Actual results may vary significantly from those anticipated due to many factors including changes in business strategy, crude oil prices, the Canadian/US currency exchange rates, industry conditions, the timing of capital expenditures, the availability and prices of goods and services as well as government regulation and operating risks.
Canadian Oil Sands Trust
PO Box 2850
150 - 9th Avenue S.W.
Calgary, Alberta T2P 2S5
Canada
Shares Listed - COS.UN
The Toronto Stock Exchange -30- For further information: Robert W. Fotheringham, Chief Financial
Officer, (403) 290-3332;
To request a free copy of this organization's annual report, please go to www.newswire.ca and click on reports@cnw.
|