Marathon Oil Corp said on Tuesday it agreed to buy Canada’s Western Oil Sands Inc.(WTO.TO: Quote, Profile , Research) for about $5.56 billion, giving the U.S. oil company a foothold in one of the world’s most promising streams of new crude oil.

Marathon said it will pay about $3.6 billion in cash plus 34.3 million shares or securities exchangeable for shares. It will also assume about $650 million of debt.

Houston-based Marathon — which also posted a higher-than-expected second quarter profit — has been looking for a partner in the Canadian oil sands for two years.

Still, it is expensive and requires special equipment to turn the tar-like sludge that comes from the region — called bitumen — into usable fuel. And analysts said other bidders may emerge.

Marathon has plans to link the Canadian fields with its refining operations in the United States.

Marathon’s refining operations are “well positioned to provide both near and long-term solutions to maximize the value of these substantial bitumen resources,” said Chief Executive Clarence Cazalot in a statement.

“We are joining an ongoing and expanding project with strong partners, and collectively, we will be able to apply our technical and commercial skills to maximize both the recovery and value of these resources,” he said.

complete this article visit at : today.reuters.com