CO-OP

Canada's Federated Co-operatives looks to sell oil-producing business, keep refinery

By Rod Nickel 20 hrs ago

WINNIPEG, Manitoba (Reuters) - Canada's Federated Co-operatives Limited (FCL) put its oil production business up for sale this week, according to a marketing document obtained by Reuters, but the co-op said it plans to keep its Saskatchewan refinery.

FCL spokesperson Cam Zimmer did not comment on the reason for offering to sell the production business but said the co-op is committed to owning its Regina, Saskatchewan refinery long-term.

FCL, which made C$7.9 billion in sales last year from energy, crop supplies and food, is offering to sell its crude unit, which includes a production base of 3,000 barrels of oil equivalent per day, mostly liquids, and 550,000 hectares of land across Saskatchewan, Alberta and British Columbia, according to the document issued on Monday by Bank of Montreal.

The bank is handling the sale.

Also for sale is FCL's stake in a carbon capture project at Weyburn, Saskatchewan operated by Whitecap Resources.

The assets may be worth C$80 million to C$100 million ($79.07 million), an industry source said.

In May, FCL said it planned to cut an undisclosed number of jobs at the refinery, after pandemic lockdowns hit its energy revenues in 2020.

More than half of FCL's revenue came from energy last year, according to its annual report.

($1 = 1.2647 Canadian dollars)

(Reporting by Rod Nickel in Winnipeg; Editing by David Gregorio)