Gulf Canada Ltd. said it will sell most of its refining, distribution and marketing assets to Petro-Canada, the Canadian government's oil company, for about $449 million.
Petro-Canada also agreed to purchase Gulf Canada's refinery in Edmonton, Alberta, for another $202.2 million by Feb. 27, 1987.
A spokesman for Gulf Canada said the company is negotiating with other parties to sell all of its remaining refining and marketing assets. He did not provide an estimate of the value of those assets.
The transaction will help finance Gulf Canada's previously reported agreement to pay $919.5 million for at least 90% of Abitibi-Price Inc.
Gulf Canada agreed to buy the Abitibi-Price stake Aug. 2 from Toronto's Reichmann family at the same time that the family paid $1.7 billion to buy 49.9% of Gulf Canada from Chevron Corp. The Reichmanns hold their Gulf Canada and Abitibi-Price interests through their real estate development company, Olympia & York Developments.
The sale of Gulf Canada's assets will help the company concentrate its interests on oil and natural gas producing properties and on Abitibi-Price, the world's largest newsprint producer.
In acquiring the assets from Gulf Canada, Petro-Canada significantly increases its network of gasoline stations in western Canada, where it currently has 375 stations.
Under the agreement, Petro-Canada will pay $228.8 million for 1,800 gasoline stations, of which 1,300 are in western Canada; a refinery and lubricant plant in Ontario; the remaining 51% interest in a British Columbia refinery that it doesn't already own, and an asphalt plant in Saskatchewan.
Petro-Canada will pay an additional $220.7 million for Gulf Canada's related oil and natural gas inventories.