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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The fair value of consideration transferred and the assets acquired and liabilities assumed at the date of acquisition are
summarized below:
($ millions)
Total purchase price 515
Allocation of purchase price:
.......................................................................................................................................................................................................................................................
Property, plant and equipment 374
.......................................................................................................................................................................................................................................................
Deferred income taxes 312
.......................................................................................................................................................................................................................................................
Decommissioning and restoration provisions (81)
.......................................................................................................................................................................................................................................................
Contracts and liabilities acquired (90)
Net assets acquired 515
The fair value attributed to the property, plant and equipment acquired was based on an expected future cash flow
approach for assets expected to be retained, with a risk-adjusted discount rate of 10%. For assets expected to be sold,
the fair value was determined based on management’s best estimate of the recoverable amount.
The fair value of the decommissioning and restoration provisions was determined based on management’s best estimate
of the costs to complete the reclamation activities, the timing of cash outflows, method of reclamation, the discount rate
and management’s anticipated use of the area in the future.
Following the acquisition, the company announced that it was not proceeding with the Voyageur upgrader project. The
decision was a result of a joint strategic and economic review launched by the company and its co-owner, Total E&P, in
response to a change in market conditions that challenged the economics of the project. As a result of not proceeding
with the upgrading portion of the project, a charge of $82 million was recorded to net earnings during the year,
including costs related to the acceleration of certain reclamation activities.
34. SALE OF NATURAL GAS BUSINESS
On September 26, 2013, the company completed the previously announced sale of a significant portion of its natural gas
business in Western Canada for proceeds of $1.0 billion before closing adjustments and other closing costs. The sale of
these assets resulted in an after-tax gain on disposal of assets of $130 million in its Exploration and Production segment.
35. SUSPENDED EXPLORATORY WELL COSTS
($ millions) 2013 2012
Beginning of year 318 387
.......................................................................................................................................................................................................................................................
Additions 24 4
.......................................................................................................................................................................................................................................................
Capitalized exploratory well costs charged to expense — (73)
.......................................................................................................................................................................................................................................................
End of year 342 318
134 SUNCOR ENERGY INC. ANNUAL REPORT 2013
