Suncor reports second-quarter net loss of $735 million (Can.)
Citing slumping crude-oil prices and the Alberta wildfires, Suncor Energy Inc., Calgary, reported a second-quarter net loss of $735 million (Can.) and an operating loss of $565 million.
The forest fires in May reduced second-quarter oil sands production by 20 million bbl. By mid-July, all oil sands assets had returned to normal production rates after being shut in due to the forest fires and the completion of turnarounds (OGJ Online, June 10, 2016).
Suncor’s oil sands production averaged 177,500 b/d compared with 423,800 b/d a year earlier.
The company incurred $50 million of aftertax incremental costs related to evacuation and restart activities, but that figure was more than offset by aftertax operating cost reductions of $180 million while operations were shut in.
Suncor noted a higher share of Syncrude operating expenses due to the acquisition of additional working interests that brought its ownership share to 53.74%. Its Syncrude production increased to 35,600 b/d compared with 24,900 b/d a year earlier.
Volumes in exploration and production increased to 117,600 boe/d compared with 111,200 boe/d a year earlier, primarily because of higher production from new wells in Hibernia field offshore Newfoundland and Labrador. Meanwhile, the Golden Eagle Area development in the central North Sea operated at peak rates compared with being in a ramp-up phase a year earlier.
Total upstream production decreased to 330,700 boe/d compared with 559,900 boe/d in the same quarter a year ago.
Suncor said construction activities at the Fort Hills oil sands mining project have resumed after being interrupted by the wildfires. The project was more than 60% complete on June 30. Suncor is still targeting start of oil production by yearend 2017. The start of oil production from the Hebron heavy-oil project offshore Canada’s East Coast, meanwhile, is also expected in late 2017 (OGJ Online, Feb. 4, 2016).
During the quarter, Suncor’s refining segment completed planned maintenance at the Commerce City, Sarnia, and Montreal refineries. Average refinery utilization declined to 87% from 90% a year earlier.