Suncor Energy, Canada’s original Albertan oil sands developer, agreed to an all-stock purchase of Petro Canada Monday morning at a total of about $19 billion Canadian.

This merger will combine the two largest official operators in Canada’s Albertan and Saskatchewan oil sands; Petro Canada shareholders will receive 1.28 common shares for each share of Petro Canada; existing Suncor shareholders will receive a one-for-one exchange. This exchange would represent a 25 per cent premium for Petro Canada, who earned $3.8 billion last year.

The companies statement said they would expect to save about $300 million a year due to optimization and increased productivity from the merger.

Petro Canada, formed by Pierre Trudeau, Canada’s most well-known Prime Minister during the 1970s, had the aim of encouraging Canadian control over its energy resources to increase national and economic security. The company only became independent from the federal government in 1995.

“It’s a made-in-Canada response to the challenges presented by global market uncertainty today,” said C.E.O. of Petro Canada, Ron Brenneman.

Suncor, however, originated as the 1917 Canadian subsidiary of American-owned Sun Oil, the company also became independent of its original shareholder in 1995 when the company auctioned off its remaining shares. The company has been named one of Canada’s top 100 employers as of 2008.

The company’s CEO announced later in the day that the new firm will control roughly 500,000 barrels of oil per day, and has no intent to auction off any of its existing refineries.

Crude oil for May deliver increased to $53.52 Monday morning, an increase of $1.45 U.S. The Dow Jones Industrial Average matched the increase, increasing roughly 364 points in intra-day trading.

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