Suncor Energy announces $2.5 billion bought-deal common share financing

Suncor today (June 7) announced it has entered into an agreement to sell 71.5 million common shares from treasury, on a bought deal basis, at a price of $35.00 per share (the “Offering”). The net proceeds of the Offering will be used for the previously announced acquisition of an additional five per cent interest in the Syncrude joint venture and to reduce certain outstanding indebtedness in order to provide ongoing balance sheet flexibility, including for opportunistic growth transactions that Suncor may identify in the future.

Over the last nine months, Suncor has invested approximately $9 billion via acquisitions and related future development expenditures, resulting in increased, long life production capacity of approximately 164,000 barrels per day. Including the Offering, these investments have been 60 per cent funded by the issuance of equity and 40 per cent by cash and debt, leaving balance sheet flexibility for potential future opportunistic growth transactions.

The Offering will be made through a syndicate of underwriters (the “Underwriters”) led by TD Securities Inc., CIBC Capital Markets and J.P. Morgan Securities Canada Inc. The gross proceeds are expected to be approximately $2.5 billion. Completion of the Offering is subject to, and conditional upon, the receipt of all necessary approvals, including approval of the Toronto Stock Exchange and the New York Stock Exchange. The Offering is expected to close on or about June 22, 2016.

Suncor has also granted the Underwriters an over-allotment option to purchase up to an additional 10.7 million common shares at the offering price, exercisable at any time until 30 days after closing of the Offering. If the over-allotment option is exercised in full, the gross proceeds from the Offering are expected to be approximately $2.9 billion.

The common shares will be issued by way of a short form prospectus that will be filed with securities regulatory authorities in Canada and with the Securities and Exchange Commission (SEC) in the United States under the multijurisdictional disclosure system. Suncor has filed a preliminary short form prospectus in respect of the Offering and a registration statement (including the preliminary short form prospectus) with the SEC to which this communication and the Offering relate. The preliminary short form prospectus is subject to completion or amendment. In Canada, there will not be any sale or any acceptance of an offer to buy securities until a receipt for the final short form prospectus has been issued. Before you invest, you should read the short form prospectus and other documents Suncor has filed with the SEC and with the Canadian securities regulatory authorities for more complete information about Suncor and the Offering. The Offering is made only by the prospectus.

The registration statement relating to the common shares has been filed with the SEC but has not yet become effective. The common shares may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. You may obtain any of these documents for free by visiting EDGAR on the SEC website at www.sec.gov or via SEDAR at www.sedar.com. Alternatively, Suncor, any underwriter or any dealer participating in the Offering will arrange to send you the preliminary short form prospectus or you may request it from TD Securities Inc. in Canada, Attention: Symcor, NPM (tel: 289-3602009, email: sdcconfirms@td.com), 1625 Tech Avenue, Mississauga ON L4W 5P5; or you may request it from TD Securities (USA) LLC in the U.S. (tel: 212-827-7392), 31 W 52nd Street, New York NY 10019 or from CIBC Capital Markets in Canada, Attention: Michelene Dougherty (tel: 416-956-3636, email: michelene. dougherty@cibc.ca), 22 Front Street West, Mailroom, Toronto ON, M5J 2W5 or from CIBC Capital Markets in the U.S., Attention: Hector Cruz (tel: 800-2820822, email: useprospectus@cibc.com), 425 Lexington Avenue, 5th floor, New York, NY or from J.P. Morgan (tel: 866803-9204, email: prospectus-eq_fi@jpmchase.com).