Suncor Energy will add three new independent directors and review the future of its downstream retail business under a deal the Canadian oil sands company struck with US activist investor fund Elliott Investment Management.
The strategic review of the retail unit will explore a potential sale as well as other options to enhance its value, the company said today. A committee being set up to carry out the review is expected to report back in the fourth quarter.
The three independent directors are former BHP Billiton executive Ian Ashby; Chris Seasons, former president of Devon Canada; and ex-Talisman Energy executive Jackie Sheppard.
Suncor's safety record and operational performance had previously come under fire from Elliott, which in April proposed a slate of five new board directors and called for a change in leadership. Former chief executive Mark Little stepped down earlier this month after Suncor reported a fatality at its Base Plant north of Fort McMurray, Alberta.
Two of the new directors will serve on a committee that is searching for a permanent replacement for the chief executive post. In the meantime, Kris Smith, executive vice president for downstream, is acting as interim chief executive.
Suncor is Canada's third-largest petroleum producer after Canadian Natural Resources and Cenovus Energy. Suncor posted output of 766,000 b/d of oil equivalent during the first quarter and a record quarterly profit of C$2.9bn ($2.3bn). The company in May hiked its dividend to the highest ever, aiming to calm investors' concerns.
The integrated company has more than 450,000 b/d of refining capacity along with more than 1,500 retail stations.
