Canada’s biggest oil sands producers, which have stubbornly resisted halting output even as the price of their crude hits record lows, are planning a higher-than-normal maintenance schedule this year The Continue Reading
Some of the world’s most expensive crude lies trapped inside Canada’s oil sands. But the lingering legacy of $100 barrels means the nation is destined to exacerbate, rather than alleviate, Continue Reading
The head of Nexen Energy ULC, which is owned by Chinese state-controlled energy company Cnooc, apologized for the accident at its Long Lake facility in northern Alberta and said Cnooc Continue Reading
The two Canadian energy companies have been working on a revised bid since Friday , this person said, adding that talks were still ongoing. The value of the potential revised Continue Reading
The companies that clean the boilers, grease the machinery and tighten the bolts are skirting the carnage in Canada’s energy patch. Even as crude trades at its lowest in 12 Continue Reading
Ahead of the expiration of a hostile takeover offer, Canadian Oil Sands Ltd. said it was in a strong position to endure the weak market alone. Canadian Oil Sands is Continue Reading
Crude oil production at Syncrude Canada’s oil sands operation averaged 238,800 barrels per day (bpd) in December, down 26 percent from November, the joint venture’s largest-interest owner, Canadian Oil Sands Continue Reading
Canadian Oil Sands holds the largest stake in the Syncrude oil-sands mining consortium. Canadian Oil Sands shareholders have until Friday to accept Suncor’s offer of 0.25 of a share for Continue Reading
Canadian oil-sands producers like Suncor Energy Inc. like to tout the long life of the world’s third-largest crude reserves as their greatest asset. That longevity may now be their biggest Continue Reading
Even with oil priced below $50 per barrel, Canadian Oil Sands, a target of a takeover bid, said it will be able to stay in the black under a 2016 Continue Reading
Canadian Oil Sands holds the largest stake in the Syncrude oil-sands mining consortium. The interest by other parties may slow Suncor’s momentum ahead of a Dec. 4 deadline it has Continue Reading
The Suncor oil-sands extraction plant near Fort McMurray in Alberta, Canada. CALGARY, Alberta—The government of oil-rich Alberta province in western Canada on Sunday pledged to phase out coal emissions by 2030, limit greenhouse gases from oil-sands production and implement an economywide carbon tax. The province unveiled the long-awaited plan one day ahead of a meeting in Ottawa among Prime Minister Justin Trudeau, Alberta Premier Rachel Notley, and the leaders of other Canadian provinces and territories to discuss environment policy. Mr. Trudeau has pledged to develop a framework for reducing greenhouse-gas emissions before a United Nations summit on Nov. 30. The plan comes at a challenging time for coal and oil producers in western Canada that are struggling to cope with low commodity prices. “Our goal is to become one of the world’s most progressive and forward-looking energy producers,” Ms. Notley said at a news conference in Edmonton. “We are […]
Suncor Energy Inc., Calgary, plans to spend $6.7-7.3 billion and production of 525,000-565,000 boe/d in 2016, with a slight decline in oil sands output. The company says the “budget incorporates Continue Reading
PlayCurrent Time 0:00/Duration Time 0:00Remaining Time -0:00Stream TypeLIVELoaded: 0%Progress: 0%00:00Fullscreen00:00MutePlayback Rate1Subtitles subtitles off Captions captions settings captions off Chapters Chapters No compatible source was found for this video.Foreground—WhiteBlackRedGreenBlueYellowMagentaCyan—OpaqueSemi-OpaqueBackground—WhiteBlackRedGreenBlueYellowMagentaCyan—OpaqueSemi-TransparentTransparentWindow—WhiteBlackRedGreenBlueYellowMagentaCyan—OpaqueSemi-TransparentTransparentFont Size50%75%100%125%150%175%200%300%400%Text Edge StyleNoneRaisedDepressedUniformDropshadowFont FamilyDefaultMonospace SerifProportional SerifMonospace Sans-SerifProportional Sans-SerifCasualScriptSmall CapsDefaultsDonexShare & EmbedCopy CodeAdvertisement Suncor CEO on Merger and Acquisition Opportunities Suncor Chief Executive Officer Steven Williams is seeking more assets in Canada’s beaten-down oil sands, saying he’s cracked the code for making money in the notoriously costly region. The country’s largest crude producer is seeking to take advantage of an industry downturn to get even bigger. As competitors struggle or walk away from bitumen production in northern Alberta because of a 60 percent slide in crude prices since June of last year, Suncor is ready to step in, Williams said. “We’re starting to bust this paradigm of Canadian oil sands being expensive,” Williams said before an interview on Bloomberg TV Canada in […]
Suncor Energy Inc., Canada’s largest crude producer, plans to boost capital spending to as much as C$7.3 billion ($5.5 billion) next year to expand operations and increase efficiency. The investment would be an increase from about C$6.3 billion this year, the average of 14 analysts’ estimates compiled by Bloomberg. The program is flexible, within a range starting at C$6.7 billion, to respond quickly to any further deterioration in market conditions, Suncor said Tuesday. Both capital and operating expenditures can be scaled back. Suncor has announced 1,000 job cuts, lowered its 2015 capital budget by $1 billion and delayed projects to weather collapsing prices. The company, along with Canadian Natural Resources Ltd., Cenovus Energy Inc. and other competitors, has squeezed spending in the oil sands, one of the world’s most expensive reserves to develop. “We’re well-positioned to invest in our base business and growth projects, even in a lower for […]
Canadian Oil Sands says it’s frustrated with scare tactics used by rival Suncor in its unsolicited takeover offer. Photo courtesy of Canadian Oil Sands CALGARY, Alberta, Nov. 13 (UPI) — Canadian Oil Sands Ltd. continued to urge its shareholders to reject a bid from rival Suncor Energy, saying the offer would sell itself if it was worthwhile. Suncor last month said its unsolicited $3.2 billion takeover bid for its rival was a "financially compelling" offer. Last week, Suncor called on the Alberta Securities Commission to consider a shareholder rights plan adopted by Canadian Oil Sands, which is designed to prevent the takeover . Suncor, in a letter to rival shareholders, said a "do-nothing" stance from Canadian Oil Sands is a risky position given the continued weakness in the energy sector. In a new filing, Suncor said it updated information on the bid to reflect further evidence of the downturn […]
U.S. study of post-Keystone XL energy landscape in Canada finds rail may carry more oil across the region. Photo by Steven Frame/Shutterstock WASHINGTON, Nov. 11 (UPI) — Crude oil deliveries from Alberta, Canada, will rely on rail in the wake of the permit refusal for Keystone XL , the U.S. Energy Information Administration said. The U.S. State Department last week denied TransCanada’s permit to build the cross-border Keystone XL oil pipeline. The project was designed to carry as much as 830,000 barrels of oil per day from Canada to Nebraska. From there, it would eventually send oil through the so-called Gulf Coast Project, which TransCanada put into service in 2014, and on to refineries along the southern U.S. coast Mark Cooper , a TransCanada spokesman, said saying no to Keystone XL means more of Canada’s crude oil would be sent to the U.S. market by rail, which the company […]
Canadian Oil Sands says its weathering weak market, recommending shareholders reject unsolicited bid from rival Suncor. Photo courtesy of Canadian Oil Sands CALGARY, Alberta, Oct. 30 (UPI) — While posting a heavy loss for the quarter, Canadian Oil Sands Ltd. said it was advising against what it considers an undervalued bid by rival Suncor. Canadian Oil Sands, among the largest owners in the Syncrude joint venture production group in northern Alberta, said its operating expenses fell to around $5 per barrel, its net debt declined and capital expenses were down 62 percent to $63.5 million. The company said it’s achieved around $750 million in cost reductions during the first nine months of the year. "Canadian Oil Sands is demonstrating its ability to weather this period of low oil prices and even a modest improvement in oil prices will generate robust expansion of cash flow," President and Chief Executive Officer […]
Canadian oil sands producer Suncor reports production increase from third quarter, though profits down during depressed market. Photo courtesy of Suncor CALGARY, Alberta, Oct. 29 (UPI) — Canadian oil company Suncor said production for the third quarter was up 9 percent year-on-year at a time when surplus is driving industry profits down. "Our focus on operational discipline continues to pay off," President and Chief Executive Officer Steve Williams said in a statement. Suncor, the largest energy company in Canada, reported total production for the third quarter of 566,100 barrels of oil equivalent per day, up 9 percent year-on-year, because of strong results from British output and Canadian oil sands operations. Oil sands, which accounted for the vast majority of the company’s output, increased in production by 4.5 percent from third quarter 2014. Crude oil prices are depressed in part because markets are favoring the supply side at a time […]
CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 1.48 % , the largest stakeholder in the Syncrude oil-sands consortium, on Thursday swung to a net loss and posted a sharply lower operating profit in its latest quarter due to falling production volumes and a slump in crude oil prices. The Calgary-based company reported a net loss of 174 million Canadian dollars ($132 million), or 36 Canadian cents a share, for the three months ended Sept. 30, compared with a net profit of C$87 million, or C$0.18 a share, in the year-earlier period. It said that came partly from a C$184 million foreign exchange loss linked to U.S. dollar-denominated debt due to a weaker Canadian currency. Cash flow from operations, which is adjusted to exclude one-time items, slid 73% to C$82 million, or C$0.17 a share, down from C$302 million, or C$0.62 per share, a year ago. Canadian Oil Sands blamed […]
Weak oil economy and the lack of pipeline infrastructure caused Royal Dutch Shell to shelve Canadian oil sands project. File photo by Brian Kersey/UPI CALGARY, Alberta, Oct. 28 (UPI) — An uncertain market and the lack of infrastructure needed to move Canadian oil to the global market means it’s time to scrap an Alberta oil project, Shell said. Royal Dutch Shell said it would no longer continue with the construction of its Carmon Creek project in Alberta, Canada, and take a $2 billion write down for the loss. Sanctioned in 2013, the company said it had moved in early 2015 to retool construction operations at the oil sands project, which was expected to yield 80,000 barrels of oil per day. Costs at a time of lingering market weakness and the lack of pipelines needed to move Canadian oil to the global market forced the company to reconsider its priorities. […]
A new report from Oil Change International challenges industry’s common assumption that the continued production of oilsands crude is inevitable. The report, Lockdown: The End of Growth in the Tar Sands , argues industry projections — to expand oilsands production from a current 2.1 million barrels per day to as much as 5.8 million barrels per day by 2035 — rely on high prices, public licence and a growing pipeline infrastructure — all of which are currently endangered in a carbon-constrained world. As the report’s authors find, growing opposition to oil production — especially in the oilsands, which is among the most carbon intensive oil in the world — has significantly altered public perception of pipelines, a change amplified by the cross-continental battles against the Enbridge Northern Gateway , Kinder Morgan Trans Mountain , TransCanada Energy East and TransCanada Keystone XL pipelines. According to the report’s authors, production growth […]
Sign up for quick access to a wealth of global business news, including: Oil majors rush cuts to hit $60 break-even Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery yes no no For […]
(Bloomberg) — Royal Dutch Shell Plc made its second major strategic change in as many months, announcing it will take a $2 billion charge as it shelves an oil-sands project in Alberta after walking away from an Arctic drilling program. Shell is halting work on the 80,000 barrel-a-day Carmon Creek drilling development after deciding the project couldn’t compete in its portfolio, the company said in a statement Tuesday. The charge will be recorded in third-quarter earnings results, which are due to be released Thursday. Energy producers are canceling or delaying projects as a crude price slump forces them to prioritize spending. The company last month abandoned drilling offshore Alaska indefinitely after it failed to find enough oil or gas in the Chukchi Sea. Earlier this year, Shell withdrew an application to develop the Pierre River oil-sands mine in northern Alberta. “We are making changes to Shell’s portfolio mix by […]
CALGARY, Alberta— Royal Dutch Shell RDS.A -1.70 % PLC said Tuesday it would abandon the construction of a major oil-sands project in Western Canada and take a $2 billion write-down, a stark reflection of the challenging economics for unconventional oil projects amid a sharp slump in crude prices. The energy giant said it would discontinue its 80,000 barrel-a-day Carmen Creek oil-sands project, citing an uncertain business environment and highlighting concerns about sufficient pipeline capacity to ship oil-sands crude to markets. Several proposed pipeline projects connecting northern Alberta’s oil sands to refiners in the U.S. and elsewhere have been delayed by regulatory issues, including the Keystone XL pipeline to the U.S. Gulf Coast. “We are making changes to Shell’s portfolio mix by reviewing our longer-term upstream options world-wide, and managing affordability and exposure in the current world of lower oil prices. This is forcing tough choices at Shell,” Ben van […]
Sign up for quick access to a wealth of global business news, including: Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery yes no no For 4 weeks receive unlimited digital access to the […]
Canadian Oil Sands Ltd. says it hasn’t been approached with any other takeover offers after rejecting Suncor Energy Inc.’s C$4.3 billion ($3.3 billion) hostile bid, though it’s exploring alternatives. Chief Executive Officer Ryan Kubik said there are plenty of parties who might be interested in taking over, partnering or merging with his Calgary-based firm. To date though, Suncor’s offer is the only one on the table, he said. “Nobody’s approached us so far,” Kubik said in an interview at Bloomberg’s office in Toronto on Monday. “There are many parties that would like to own it.” Canadian Oil Sands urged shareholders to reject Suncor’s takeover attempt, accusing the larger rival of undervaluing its business and exploiting undisclosed information about a partnership in making a low-ball offer. Suncor, Canada’s largest crude producer, renewed efforts this month to take over its partner and biggest shareholder in the Syncrude oil-sands joint venture after […]
Suncor’s unsolicited bid for the largest owner in the Syncrude oil-sands consortium has been closely watched by industry observers as a sign that Canada’s biggest oil and gas producer may think global crude prices are at or close to their bottom, after falling 50% over the past year. Oil’s slump has punished stock prices of most energy producers, including Canadian Oil Sands, whose shares fell to 15-year lows in the weeks before Suncor made its offer. “It’s no secret that Suncor’s timing is opportunistic. It’s designed to take advantage of Canadian Oil Sands’ shareholders during an unprecedented period of market uncertainty in the energy industry,” Don Lowry, chairman of Canadian Oil Sands, said on a conference call. Mr. Lowry accused Suncor of seeking to buy out Canadian Oil Sands at “fire-sale prices,” but he left the door open to a possible deal by saying the board would continue to […]
Suncor Energy Inc.’s offer to buy Canadian Oil Sands Ltd., the largest stakeholder in oil-sands miner Syncrude Canada Ltd., is “ill advised” because of the low oil price and the potential for further share-price declines, said Venator Capital Management Chief Executive Officer Brandon Osten. For the the Canadian Oil Sands purchase “to offer reasonable rates of return, you kind of need $70 dollar-plus oil and you’re not really there,’’ Osten said in an interview Wednesday at Bloomberg’s Toronto office. Venator Capital is a Toronto-based hedge fund with about C$300 million ($233 million) under management, and has shorted Suncor since the first quarter, he said. Suncor, Canada’s largest crude producer, is taking advantage of a prolonged oil rout to renew its effort to take over Canadian Oil Sands after two friendly offers were turned down earlier this year. Suncor has offered to trade 0.25 Suncor share for each share of […]
Calgary, Alberta-based Canadian Oil Sands said the shareholder rights plan is meant to give its shareholders and board adequate time to evaluate Suncor’s 4.3 billion Canadian dollar ($3.3 billion) all-stock offer and any other unsolicited bid or strategic options. The company reiterated that shareholders take no action on the Suncor bid until the offer has been fully reviewed by its board. “The board will consider Suncor’s unsolicited offer in both the current context and in light of the strong long-term potential of Canadian Oil Sands,” Canadian Oil Sands Chairman Donald Lowry said in a statement. Shareholder rights plans, or poison pills, are designed to dilute the value of a stock by flooding the market with additional shares, which makes it expensive for an investor to acquire a controlling stake. The rights plan, which is in addition to one already in place, would be triggered upon the purchase of 20% […]
EDAM, Saskatchewan—In a muddy field where rows of canola stood just three months ago, a miniature oil-sands plant is rapidly being assembled by a small crew of workers. What’s unusual about this project is the speed with which it is being built—in a matter of months—and its compact, football field-size. Oil-sands sites typically take years to build and require hundreds or thousands of acres of land. At a time when slumping crude-oil prices have shelved most new oil-sands projects in neighboring Alberta and halted drilling for all but the most productive shale oil wells in the Bakken formation on both sides of the border, pint-size sites are proliferating in Saskatchewan’s oil patch. About a mile away from the construction site, down a rural highway in western Saskatchewan, three other similarly size heavy-oil projects are rising on a landscape filled with cattle pastures and duck ponds. The miniboom along Highway […]
Steve Williams, president and CEO of Suncor Energy Inc., speaks at their annual general meeting in Edmonton April 29, 2014. Suncor Energy Inc launched a hostile bid for Canadian Oil Sands Ltd on Monday as the slump in oil prices encourages consolidation in Canada’s oil sands industry, which has some of the world’s highest operating costs and lowest prices. Canadian Oil Sands and Suncor are among stakeholders in Canada’s largest synthetic crude project, Syncrude, in northern Alberta. Alberta’s oil sands are the world’s third-largest crude reserves after Saudi Arabia and Venezuela and a leading source of U.S. crude imports. Suncor’s all-stock offer for Canadian Oil Sands is valued at about C$4.3 billion ($3.29 billion). Suncor shares were down 2 percent at C$34.67 and Canadian Oil Sands shares were up 48 percent at C$9.15 on the Toronto Stock Exchange on Monday morning. Canadian Oil Sands was not immediately available for […]
The study also confirmed that overall flows in the Athabasca River are declining. That’s something that was already known and thought to be mainly because of the melting and shrinking of glaciers, seen in this photo of the river’s headwaters. (David Sauchyn) The river that provides water to the oilsands industry is much more prone to multi-year droughts than modern records show, suggesting that the industry’s current level of water use may not be sustainable, a new study suggests. The oilsands industry needs 3.1 barrels of fresh water to produce a barrel of crude oil from oilsands mining and 0.4 barrels of fresh water to produce a barrel of crude oil from oilsands drilling, according to the Canadian Association of Petroleum Producers . That water comes mainly from northern Alberta’s Athabasca River, and oilsands account for 72 per cent of estimated water use from the river. The government regulates […]
Suncor Energy Inc.’s bargain on a further 10 percent stake in its Fort Hills oil-sands project shows how the energy market crash is reducing asset values in one of the most expensive places on Earth to extract crude. Canada’s largest energy producer will pay Total SA C$310 million ($234 million) for an additional 10 percent share in the C$15 billion oil sands mine being built in northern Alberta, the companies said Monday. That’s less than a third of the value Teck Resources Ltd., another partner in the project, ascribes to its stake. Teck said its 20 percent is worth C$2.3 billion in a July release. The deal is also 31 percent less than the C$450 million Desjardins Capital Markets assumes a 10 percent stake in Fort Hills is worth. Desjardins based its estimate on a reduced long-term U.S. oil price of $80 a barrel starting in 2017, Justin Bouchard, […]
CALGARY, Alberta—The Canadian unit of Chinese state-controlled energy giant Cnooc Ltd. CEO 2.76 % said Wednesday that it can resume full production at a troubled oil-sands operation after regulatory authorities eased a suspension order that had crimped its output. Cnooc subsidiary Nexen Energy ULC said Alberta’s chief energy regulator amended an order that threatened to shut down its 50,000 barrel a day Long Lake heavy oil extraction facility located in the province’s northeastern boreal forests. “Nexen is able to resume 100% of our operations” at its Long Lake oil sands plant, the company said in a statement. The Alberta Energy Regulator imposed the order late last month for suspected failure to comply with certain rules, effectively rendering the plant inoperable. The AER scaled back that order earlier this month [Sept. 6], which allowed Nexen to operate at three-quarters of its previous production levels. It further revised the order on […]
Canadian Oil Sands Ltd. isn’t planning to sell future royalty production after considering the option, a company spokeswoman said. Canadian Oil Sands has enough liquidity to survive a period of low oil prices, Siren Fisekci, a company spokeswoman, said in a phone interview on Tuesday. The company isn’t pursuing any other plans at the moment to raise capital and isn’t for sale, she said. Management of the largest owner of Syncrude Canada Ltd. spoke with Holder Highfields Capital about selling some future production for upfront payment to help boost the company’s flagging shares, the Wall Street Journal reported earlier. The oil-sands producer in January cut its dividend the most since 1998 to cope with sinking crude prices. Shares of Canadian Oil Sands have declined 38 percent this year. The stock rose 3.7 percent to C$6.50 at 2:44 p.m. in Toronto.
The last place oil producers want to be when prices plummet to profit-demolishing lows is midstream on a billion-dollar project in one of the costliest parts of the planet to extract crude. Yet that’s exactly where half a dozen oil sands operators from Suncor Energy Inc. to Brion Energy Corp. find themselves with prices for Canadian oil now hovering around $30 a barrel. While all around them projects have been postponed or canceled, their investments were judged too far along when the oil game suddenly moved from offense to defense. These projects will add at least another 500,000 barrels a day — roughly a 25 percent increase from Alberta — to an oversupplied North American market by 2017. For companies stuck spending billions in a downturn, the time required to earn back their investments will lengthen considerably, said Rafi Tahmazian, senior portfolio manager at Canoe Financial LP. “But the […]
CALGARY, Alberta—The Canadian unit of Chinese state-controlled energy giant Cnooc Ltd. CEO 0.69 % said Wednesday it will halt production at a 50,000 barrel-a-day oil-sands plant indefinitely as part of its effort to comply with an order from regulators forcing it to shut down pipelines at the site. The move comes after the chief energy regulator in the Western Canadian province last week suspended operating licenses affecting 95 pipelines at Cnooc subsidiary Nexen Energy ULC’s Long Lake heavy oil extraction facility in northern Alberta for suspected failure to comply with certain rules . Shutting down Long Lake is the latest in a string of setbacks at the plant , which started up in 2008 but has never reached its capacity of 72,000 barrels a day. The loss of output is a blow to parent company Cnooc, which bought Nexen for $15 billion in 2013 and installed its own management […]
By Chester Dawson CALGARY, Alberta– Canadian Oil Sands Ltd., the largest owner of the giant Syncrude oil-sands project, said Wednesday that production of synthetic crude would be "minimal" for two weeks after a weekend fire at Syncrude’s main plant, and that the lost production would impact its annual output. The company halted production after a blaze on Saturday damaged equipment at its Mildred Lake strip mine’s crude processing facility in northern Alberta. The loss of some 200,000 barrels per day of output has contributed to a sharp spike in prices of Canadian synthetic oil this week. "Syncrude plans to implement a phased recovery strategy with minimal synthetic crude oil shipments and operating rates for the next two weeks, " Canadian Oil Sands said in a statement late Wednesday. Production is expected to return to more normal levels at the end of the month, it said. The company said that […]
After decades of exhaustive attempts to overcome the dirty reputation of oil sands, we finally have an environmentally-friendly and low cost method to tap into these vast resources in the state of Utah—good news both for Mother Nature and all oil and gas investors. MCW Energy Group’s CEO, former Exxon President of the Arabian Gulf region, Dr. R. Gerald Bailey, tells Oilprice.com in an exclusive interview that his hunt for an innovative technology that simultaneously makes money and cleans up the environment is over. The race to capitalize on Utah’s vast oil sands resources is on, and only the ‘clean’—both financially and environmentally—will survive. Coming hot off of the successful launch of clean oil sands operations in Utah, while other oil sands projects are under fire from protesters, Dr. Bailey discusses: • The difference between Utah and Alberta when it comes to oil sands resources. • How new technology […]
CALGARY, Alberta, Sept 1 (Reuters) – ConocoPhillips and Husky Energy Inc announced key milestones in bringing two new oil sands projects online on Tuesday, underlining how some producers in the high-cost sector are boosting production even as crude prices tumble. The two projects will add around 178,000 barrels per day to the 2.3 million bpd already being produced from the oil sands, the world’s third largest crude reserves after Saudi Arabia and Venezuela. The Canadian Association of Petroleum Producers forecast in June that oil sands production to hit 3.1 million bpd in 2020. That forecast may be overstated however, as Imperial Oil has since delayed plans to expand its Kearl project by another 125,000 bpd. The start up announcements on Tuesday also come as around 900 oil company jobs were cut in Canada, 500 of those by ConocoPhillips, and the U.S. benchmark crude dropped more than 6 percent on […]
A dump truck is loaded with oil sands at the Syncrude Canada Ltd. mine. CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 2.60 % , the largest owner of the giant Syncrude oil-sands project, said on Sunday that it has halted production after a fire damaged equipment at its synthetic crude oil processing facility in northern Alberta. The company said the fire, which occurred early Saturday and was extinguished without any injuries, affected pipes connected to a water treatment unit at Syncrude’s heavy oil upgrader on the site of its Mildred Lake oil-sands surface mine. The cause of the blaze is under investigation, it said. While the upgrader’s core machinery wasn’t damaged and the strip mine continues to operate, Canadian Oil Sands said in a statement issued late Sunday that “synthetic crude oil production has been temporarily suspended while a recovery and repair strategy are being developed.” Canadian Oil Sands […]
The rating action targeting the largest owner of Canada’s giant Syncrude oil-sands mining consortium comes amid a swoon in oil prices below $40 a barrel, which has eroded profit margins in the energy industry and made it more difficult for highly-levered oil producers to service their debt loads. Moody’s lowered its creditworthiness assessment of Canadian Oil Sands’ senior unsecured debt to Baa 3 from Baa 2 and kept its “negative” outlook for the Calgary-based company. Baa 3 is Moody’s lowest rung of investment-grade credit and just above the speculative, or junk, grade. “Moody’s expects negative free cash flow [at Canadian Oil Sands] of about 125 million Canadian dollars ($94 million) from June 30, 2015, to September 30, 2016, to be largely debt funded,” it said. The ratings action was prompted by the recent tumble in crude prices to more than six-year lows and Canadian Oil Sands’ deteriorating balance sheet. […]
CALGARY, Alberta—Canada’s high-cost oil-sands producers are struggling as oil prices sink to fresh six-year lows, and even the most efficient drillers are losing money on every barrel they produce at current prices, according to a report published Wednesday. Canadian oil-sands production has grown 30% in the past five years but the recent price slump has hit producers’ bottom lines and forced them to suspend development of new projects. Western Canadian heavy crude costs more to extract than other oil sources because it must be separated from deposits of sand. It also trades at a discount to other crudes, in part because of the distance it must be transported from remote boreal forests in Alberta. Benchmark West Texas Intermediate oil cost less than $41 a barrel in Wednesday trading, which although at multiyear lows was still well above the Western Canadian Select average of around $24 a barrel. More than […]
Alberta’s first oilsands operation, Bitumont, on the shore of Athabasca River near Fort McMurray, Alta. Many oilsands operators are facing water restrictions due to low water levels. (Jeff McIntosh/Canadian Press) It’s wreaked havoc on crops and shut down fisheries across Alberta, but now the hot dry weather and ensuing stresses on our rivers have hit the oilsands. This week the Alberta Energy Regulator reined in oil companies by imposing restrictions on how much water they can draw from the North Athabasca basin. Those in the lower Athabasca region — including heavy hitters Suncor, Syncrude and CNRL — are not affected by the restrictions. ‘Preview of the future’ Simon Donner says a University of British Columbia study he helped to write predicted this would happen. He says this year’s low flows are the result of both climate change and a strong El Nino event that’s developing. "With regulators this week […]
Abu Dhabi National Energy Co., the government-owned utility that produces crude from Canada to the U.K., has slashed 22 percent of its oil and gas jobs in the past year amid a loss due to tumbling global prices. The company known as Taqa plans to cut spending 2.5 billion dirhams ($681 million) this year after reducing capital expenditures by 1.05 billion dirhams in the first half, according to an e-mailed statement from the company on Thursday. Headcount at the Abu Dhabi headquarters is down 32 percent since July last year. Oil producers are cutting costs after Brent crude slumped 48 percent last year and is down another 13 percent this year. Taqa’s oil and gas production averaged 150,000 barrels of oil equivalent a day in the first six months, down 5 percent from a year earlier as revenue from the business slumped 48 percent. “While the current commodity price […]
CALGARY, Alberta, Aug 12 (Reuters) – Heavy Canadian crude slumped to its lowest level in at least a decade on Wednesday after Enbridge Inc closed two of its main pipelines in the United States because of a leak, piling fresh misery on Canadian oil companies that are close to producing at a loss. Western Canada Select heavy blend crude for September delivery last traded at $20.75 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers, having settled at $19.80 per barrel below on Tuesday. Earlier in the session it hit $21.75 per barrel below WTI, the widest differential since August last year. That pushed the outright price of Canadian heavy crude to around $22.50 a barrel, a level at which some companies will struggle to cover the cost of production, blending and transportation. It was lower than the 2008 trough of $24.62, according to one […]
Canadian synthetic crude production fell 15% from previous year Producers of light synthetic crude from Canada’s oil sands found a way to manage this year’s price slump by churning out less and getting more maintenance work done. The strategy is highlighted by a 15 percent decline in the production of the Syncrude benchmark in May from a year earlier, according to data reported by Statistics Canada on Monday. Oil-sands operators including Royal Dutch Shell Plc cut output while collectively undertaking the biggest set of repairs this spring in five years at their upgraders, plants that turn bitumen into light oil, according to Genscape Inc., an energy data company. The work followed the lowest average quarterly price for benchmark U.S. crude since 2009. “From a strategic point of view, I’m sure these major companies are betting that the peak of oversupply is this year, now,” said Carl Evans, a Genscape […]
CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 0.90 % on Thursday reported a net loss in the second quarter, citing lower prices for its crude and the effect of a two percentage point corporate tax hike in the Western Canadian province where it operates. The largest owner of the Syncrude oil sands project in northern Alberta lost 128 million Canadian dollars ($98.4 million), or 26 Canadian cents a share, in the three months to June 30, compared with a net profit of C$176 million, or 36 Canadian cents a share, in the year-earlier period. It said the loss mainly came from a C$120 million deferred tax expense reflecting an increase in Alberta’s corporate tax rate to 12% from 10% previously. The company also suffered from a global crude oil price drop, which has affected many so-called unconventional producers of oil-sands crude and shale oil. Citing expenses in excess of […]
Suncor Energy Inc., Canada’s largest oil producer, cut its spending plan for 2015 for a second time and eliminated some non-essential projects as part of cost-reduction efforts. The company now plans to spend between C$5.8 billion ($4.5 billion) and C$6.4 billion from an earlier range of C$6.2 billion and C$6.8 billion, Calgary-based Suncor said Wednesday Canadian time in a statement on Marketwired. Suncor has already cut about 1,000 jobs and previously lowered its 2015 capital budget by C$1 billion while delaying projects to weather collapsing prices. Still, it’s pressing ahead with the C$13 billion Fort Hills oil-sands mine. The move to cut spending comes after the price of West Texas Intermediate moved back into a bear market, dropping below $50 a barrel earlier this month for the first time in about a quarter. The U.S. benchmark, averaged about $58 in the second quarter compared with about $103 in the […]
