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Suncor Energy Inc. will acquire Petro-Canada in a US$15.5 billion deal that will unite two of Canada's biggest oil companies, the companies announced Monday.

The move is expected to yield savings in operating costs of over CA (nyse: CA - news - people )$300 million (US$244 million) year, and annual capital efficiencies above CA$1 billion (US$812 million), the companies said.

Under the deal, Petro-Canada (nyse: PCZ - news - people ) common shareholders will receive 1.28 common shares of the expanded company for each share of Petro-Canada, while Suncor shareholders will receive new shares on a one-for-one basis.

The share exchange represents a 25 percent premium for Petro-Canada shares, based on a 30-day weighted average of the share price. Based on the closing price Friday, the deal values Petro-Canada at CA$19.12 billion (US$15.5 billion)

Petro-Canada shareholders will hold 40 percent of the enlarged company and Suncor shareholders will hold 60 percent. Both companies are based in Calgary.

Monday's announcement marks the creation of the largest oil and gas company in Canada by market cap, though the merged entity will be smaller than other global heavyweights such as Exxon Mobil (nyse: XOM - news - people ) and ConocoPhillips (nyse: COP - news - people ), which boast market capitalizations of US$326.6 billion and US$55.97 billion respectively.

"This merger creates a made-in-Canada energy leader with the assets, cost structure and financial strength to compete globally," said Rick George, president and chief executive officer of Suncor, who will continue in those roles in the new company.

Secretary of State Condoleezza Rice said that despite President Bush's low approval ratings, people will soon "start to thank this president for what he's done."

"So we can sit here and talk about the long record, but what I would say to you is that this president has faced tougher circumstances than perhaps at any time since the end of World War II, and he has delivered policies that are going to stand the test of time," Rice said in an interview that aired on CBS' "Sunday Morning."

The secretary of state brushed off reports that suggest the United States' image is suffering abroad. She praised the administration's ability to change the conversation in the Middle East.

"This isn't a popularity contest. I'm sorry, it isn't. What the administration is responsible to do is to make good choices about Americans' interests and values in the long run -- not for today's headlines, but for history's judgment," she said.

"And I am quite certain that when the final chapters are written and it's clear that Saddam Hussein's Iraq is gone in favor of an Iraq that is favorable to the future of the Middle East; when the history is written of a U.S.-China relationship that is better than it's ever been; an India relationship that is deeper and better than it's ever been; a relationship with Brazil and other countries of the left of Latin America, better than it's ever been ...

"When one looks at what we've been able to do in terms of changing the conversation in the Middle East about democracy and values, this administration will be judged well, and I'll wait for history's judgment and not today's headlines."

Asked by CBS' Rita Braver why some former diplomats say Americans are disliked around the world, Rice said that's "just not true."

"I know what U.S. policy has achieved. And so I don't know what diplomats you're talking to, but look at the record," she said.

Rice said she wasn't bothered by criticism about her or the administration's polices, saying if a person in her business is not being criticized, "you're not doing something right."

"I'm here to make tough choices, and this president is here to make tough choices, and we have. And yes, I -- there are some things that I would do very differently if I had it to do over again. You don't have that luxury. You have to make the choices and take the positions that you do at the time," she said.

Asked about historians who say Bush is one of the worst presidents, Rice said those "aren't very good historians."

"If you're making historical judgments before an administration is already out -- even out of office, and if you're trying to make historical judgments when the nature of the Middle East is still to be determined, and when one cannot yet judge the effects of decisions that this President has taken on what the Middle East will become -- I mean, for goodness' sakes, good historians are still writing books about George Washington. Good historians are certainly still writing books about Harry Truman," she said.

Rice, 54, said she has enjoyed working in the Bush administration during the last eight years, first as national security adviser, then as secretary of state.

"There is no greater honor than to serve this country," she said, adding that there is also no greater challenge.

Rice said when the new administration takes over, she plans to return to the Hoover Institution at Stanford University and write two books -- one on foreign policy and one about her parents.

The Miu Miu store on 57th Street has been a long time coming. The brand secured the space formerly occupied by Jil Sander more than two years ago, and has been postponing its opening for the past three months. Then—wouldn't you know—it was rainy on the big night itself. "Not that that could discourage me," Peaches Geldof said. "I would wait another year and go through a blizzard for Miu Miu."

Miuccia Prada was a no-show, but the party drew plenty of fashionable faces, including Claire Danes, Ciara, and Sasha Pivovarova. Hana Soukupova, a model who knows her Stevens from her Marios, was impressed with the trip through fashion history provided by the silk-screened campaigns lining the store's walls (they take the viewer from Chloë Sevigny's teenage turn to more recent subjects like Kirsten Dunst). But by the end of the affair, thoughts went back to the rotten weather. "Do you think they'll notice if I take this coat on the way out?" asked Jen Brill, in a black leather Miu Miu party dress. The answer, provided by a security guard, was a chilly yes.

aused by a malfunctioning fire safety system that spewed out chemicals, according to an initial investigation, officials said Sunday.

At least 21 other people were injured during Saturday's test run in the Sea of Japan, the Russian Defense Ministry said.

It was Russia's worst naval accident since the nuclear submarine Kursk sank after an onboard torpedo explosion on August 12, 2000, killing all 118 crew members.

The latest fatal accident was the result of the "accidental launch of the fire-extinguishing system" on the Pacific Fleet sub, Russian navy spokesman Capt. Igor Dygalo told reporters.

Russian news agency Interfax said a preliminary forensic investigation found that the release of Freon gas following the activation of the fire extinguishing system may have caused the fatalities.

Seventeen of the fatalities were civilian members of the shipyard crew, Interfax reported. The submarine was being field tested before it became a official part of the navy, according to a Russian Defense Ministry statement.

The statement said 208 people, including 81 soldiers were on board the submarine. In addition to the fatalities, the accident wounded 21, Russian officials said.

The accident did not damage the nuclear reactor on the submarine which later traveled back to its base on Russia's Pacific coast under its own power, Dygalo added.

The submarine returned to Bolshoi Kamen, a military shipyard and a navy base near Vladivostok, state-run Rossiya television said, according to The Associated Press.

Officials did not reveal the name of the submarine, but Russian news agencies quoted officials at the Amur Shipbuilding Factory who said the submarine was built there and is called the Nerpa.

Construction of the Nerpa, an Akula II class attack submarine, started in 1991 but due to a shortage of funding was suspended for several years, the reports said. Testing on the submarine began last month and it submerged for the first time last week.

The Kremlin is seeking to restore Russia's military power amid strained ties with the West following the war with Georgia.

But despite former President Vladimir Putin increasing military spending, Russia's military remains hampered by decrepit infrastructure and aging weapons.

The Kremlin said President Dmitry Medvedev was told about the accident immediately and ordered a thorough investigation.