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Suncor Energy Inc. (NYSE: SU), Fort McKay First Nation (FMFN), and Mikisew Cree First Nation (MCFN) announced today the completion of the acquisition by FMFN and MCFN of a 49% partnership in Suncor’s East Tank Farm Development for total proceeds of $503 million.

Fort McKay First Nation is composed of over 800 band members with approximately 400 members residing in the hamlet of Fort McKay, a community located approximately 65 km north of Fort McMurray.

“The deal represents the largest business investment to date by a First Nation entity in Canada, and not only demonstrates the great potential for partnerships between First Nations and industry but serves as a model for how First Nations can achieve greater self-determination through financial independence,” said FMFN Chief Jim Boucher. “This deal is built on a foundation of trust and collaboration between Fort McKay and Suncor; this is an example of how First Nations and natural resource development companies can find ways to support each other for the mutual long-term benefits.”

Mikisew Cree First Nation members reside in Fort McMurray, Edmonton, Fort Smith, NWT, and Fort Chipewyan.

“It’s with great pride that we are part of this monumental deal. It has allowed us to collaborate in a true partnership and demonstrates the possibilities of how future successful business models between First Nations and industry across this country can be achieved,” said MCFN Chief Archie Waquan. “The economic benefits generated from this deal will help our Nation build capacity within our businesses, develop infrastructure in our community, fund social economic programs, and provide us with the means to help pay for education and training for our youth. This will be felt in our community for generations to come.”

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The East Tank Farm Development is a bitumen and diluent storage, blending and cooling facility located approximately 30 kilometers north of Fort McMurray, Alberta. It is primarily dedicated to servicing bitumen production from the Fort Hills oil sands mining project. Revenue from long-term terminal services agreements with the Fort Hills oil sands partners underpins the financing. Suncor is the operator of the East Tank Farm Development.

Suncor Fort Hills

“This unique partnership has been part of a journey that demonstrates how innovative thinking and collaborative spirit can result in a mutually-beneficial opportunity and it has changed the way Suncor thinks about how our Aboriginal neighbors may participate in energy development,” said Suncor. “Through this partnership, we’ve learned a lot about working together to create something significant and we look forward to continuing to work together on this joint investment with Fort McKay First Nation and Mikisew Cree First Nation for many years to come.”

The two First Nations independently financed the acquisition through the issuance of $545 million, 4.136 percent senior secured notes due December 31, 2041. The offering was structured and marketed by RBC Capital Markets.

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