UPDATE 2-Total bids for UTS as oil sands industry sputters

(Adds comments from Total, analyst, recasts throughout)

By Jeffrey Jones

CALGARY, Alberta, Jan 27 (Reuters) - French oil major Total SA (TOTF.PA) launched an unsolicited C$617 million ($502 million) takeover bid for UTS Energy Corp (UTS.TO) on Tuesday to gain a stake in the delayed multibillion-dollar Fort Hills oil sands project in Canada.

In the first takeover attempt in the oil sands sector since falling oil prices triggered an economic meltdown, Total said it would bid C$1.30 cash per UTS share, a 51 percent premium over the small developer's stock price over the past 30 days.

A successful deal would bolster Total's already extensive position in northern Alberta's vast oil sands at a fraction of the price per barrel it paid for other assets in the region.

"It's a shocker -- I wasn't expecting that," said William Lacey, analyst at FirstEnergy Capital Corp in Calgary.

Officials with UTS, whose main asset is a 20 percent stake in Fort Hills, were not available for comment. UTS also has interests in two undeveloped oil sands leases.

Its shares have tumbled 84 percent in the past year, as project costs rose, oil prices sank and investors questioned the company's ability to finance its share of Fort Hills.

Operated by Petro-Canada PCA.TO, Fort Hills is a proposed four-billion-barrel project in northern Alberta. The other partner is miner Teck Cominco Ltd (TCKb.TO).