Post-retirement Plans

In connection with our PCLI acquisition, we agreed to establish employee benefit plans including union and non-union pension plans and a post-retirement healthcare plan for PCLI employees that were previously covered under legacy Suncor plans.

Our agreement with Suncor also provides that pension assets related to the union and non-union pension plans will be transferred to a pension trust which will be established by us and will be computed in accordance with the share purchase agreement, subject to regulatory approval. The actual asset transfer to our PCLI pension plan trust will be a cash transfer that is expected to occur in 2018.

The net periodic pension expense of these plans consisted of the following components:



	Three Months Ended March 31, 2018			February 1, 2017 to March 31, 2017
	(in thousands)
Service cost - benefit earned during the period	$	1,104		$	635
Interest cost on projected benefit obligations	562			349
Expected return on plan assets	(865		)	(511		)
Net periodic pension expense	$	801		$	473

The expected long-term annual rate of return on plan assets is 5.75%. This rate was used in measuring 2018 net periodic benefit costs. We expect to contribute $6.4 million to the PCLI pension plans in 2018.

We have a post-retirement healthcare and other benefits plan that is available to certain of our employees who satisfy certain age and service requirements. In addition, we have a post-retirement healthcare and other benefits plan for our PCLI employees. The net periodic benefit credit of these plans consisted of the following components:



	Three Months Ended March 31,
	2018			2017
	(In thousands)
Service cost – benefit earned during the period	$	412		$	350
Interest cost on projected benefit obligations	234			220
Amortization of prior service credit	(870		)	(870		)
Net periodic post-retirement credit	$	(224	)	$	(300	)