An agreement in principle has been reached to extend the life of the Terra Nova oil project.

Lead operator Suncor issued a statement confirming the news shortly after 8 p.m. Wednesday night.

It said the co-owners agreed to restructure the project ownership and provide short-term funds toward continued development of the asset life extension, with a plan to move to a sanction decision in the fall.

Suncor said “a subset of owners” will increase their stakes in the project for consideration payable from the other owners.

Overall, Suncor’s ownership will increase to 48 per cent from about 38 per cent.

The company said the agreement is still subject to finalized terms and approval from all parties, including board of director approval where necessary, and is contingent upon an estimated $500 million in royalty and financial support from the provincial government.

Premier Andrew Furey suggested that won’t be a problem.

He calls it a big win for Newfoundland and Labrador, for the women and men who earn their livelihood through the project, and for the industry in general.

Furey says it also confirms that government’s stance was the right one.

“It was appropriate, fair and prudent,” he said. “Despite the calls for us to change that we stood our ground and this was a good outcome for everyone involved.”

Suncor president Mark Little said the company worked diligently with all stakeholders over the past year to determine a path forward for Terra Nova.

“Despite numerous setbacks, Suncor, as operator, continued to persevere and explore options to achieve an economic return for our investors while protecting the employment of hundreds of Newfoundlanders and Labradorians.

“Although this agreement in principle is not a guarantee, it sets a path forward in the next few months to secure a return to operations for many years to come.”

The breakthrough comes a day after Equinor, a 15 per cent partner in Terra Nova, announced it was pulling up its stake and exiting the project.