Sunshine Oilsands Ltd. is committed to providing our investors and the public with timely and accurate information regarding our business and operating activies.
August 31, 2021


Hong Kong (September 1, 2021) and Calgary, Alberta (August 31, 2021) - The Board of Directors (the “Board”) of Sunshine Oilsands Ltd. (the “Corporation” or “Sunshine”) (HKEX: 2012) wishes to announce the following:



On August 31, 2021, the Corporation entered into a Royalty Agreement (together with its ancillary documents, the “Royalty Agreement”) with Burgess Energy Holdings, L.L.C. (“BEH”), pursuant to which, the Corporation has granted to BEH a royalty interest in the bitumen within, upon, under or produced from the royalty lands owned by the Corporation and/or its affiliates, free and clear of any and all encumbrances for an aggregate consideration of CAD$20,000,000 (the “Aggregate Consideration”), subject to the terms and conditions stipulated therein. The arrangement under the Royalty Agreement is perpetual.
Under the Royalty Agreement, BEH may: (i) elect to take delivery of the royalty share of bitumen; (ii) elect to appoint the Corporation as its agent, to dispose of the royalty share of bitumen on its behalf and account to BEH for the proceeds of sale, net of permitted charges (including transportation fees and diluent costs); or (iii) elect to receive a royalty payment calculated as the royalty share of bitumen multiplied by a notional realized bitumen price, net of permitted charges.
The royalty rate used to determine BEH’s royalty share of bitumen at any given time is based on the Western Canadian Select (“WCS”) price. With WCS prices below US$60/bbl, the royalty rate is 0%; the minimum 2.5% rate is triggered at US$60/bbl WCS and proportionally increases up to a maximum of 15% when the WCS price rises to US$100/bbl.


International oil prices have recovered to pre-COVID-19 price levels but remain volatile. The Directors (including the Independent Non-executive Directors) determined that entering into the Royalty Agreement, as determined based on arm’s length negotiation, will provide a reliable source of funding and strengthen the Corporation’s cashflow position. Hence, the Royalty Agreement is in the interests of the Corporation and its shareholders as a whole.




BEH is a limited liability company organized under the laws of Delaware.
To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, BEH and its respective ultimate beneficial owners are independent third parties who are independent of and not connected with the Corporation and its connected persons (as defined under the Rules Governing the Listing of Securities on the Stock Exchange).

About Sunshine Oilsands Ltd.

The Corporation is a Calgary based public corporation, listed on the Hong Kong Stock Exchange since May 1, 2012. The Corporation is focused on the development of its significant holdings of oil sands and heavy oil leases in the Athabasca oil sands region. The Corporation owns interests in oil sands and petroleum and natural gas leases in the Athabasca region of Alberta. The Corporation is currently focused on executing milestone undertakings in the West Ells project area. West Ells Phase 1 has an initial production target of 5,000 barrels per day.

For further enquiries, please contact:

Mr. Kwok Ping Sun

Executive Chairman

Tel: (852) 3188 9298


Email: [email protected]