Suncor Energy Inc. (ticker: SU) released end-of-year production numbers and provided an update to the Fort Hills dispute.
Highlights
- Upstream production of 736,000 BOEPD
- Oil sands produced 447,000 bbls/d, including 6,000 bbls/d from Fort Hills
- Syncrude produced 325,000 bbls/d for the quarter, 174,000 bbls/d net to Suncor
- International E&P production of 115,000 BOEPD
- Bitumen upgrader operations ran at utilization rates of 93% at the Suncor base plant and 94% at Syncrude
- Average refinery utilization of 94% for a quarterly crude throughput of 433,000 bbls/d
“At Hebron, we produced first oil ahead of schedule in late November. And at Fort Hills, we safely completed five test runs of the plant, producing 1.4 million barrels of froth,” said Steve Williams, Suncor president and CEO. “We’re focused on completing a safe, reliable start up in the short term and the steady ramp up of production through 2018.”
During 2017, the mine, primary extraction, utilities and froth assets were commissioned. More than 80% of the Fort Hills plant is now operational and has safely run at full capacity through the test runs over the past four months. All three secondary extraction trains are mechanically complete with the first train in its final commissioning stage and is expected to start up in mid-January.
The second and third trains are currently being insulated and expected to start up in the first half of 2018, as planned. Fort Hills remains on track to reach 90% capacity by the end of 2018, as per Suncor’s Corporate Guidance issued in November 2017.
Courtesy of Suncor
Fort Hills dispute resolved
Suncor said that the Fort Hills partners have resolved the commercial dispute, reaching an agreement whereby Suncor and Teck Resources Limited have each acquired an additional working interest in the Fort Hills project from Total E&P Canada.
Under the terms of the agreement, Suncor’s share of the project has increased to 53.06% and Teck’s share has also increased to 20.89%. Total’s share decreased to 26.05%. Suncor and Teck have funded an increased share of the project capital, in the amounts of approximately $300 million and $120 million respectively, equating to approximately $69,330 per flowing barrel, commensurate with the additional working interests, which may be further adjusted in accordance with the terms of the agreement.
The Suncor CEO described the Fort Hills project as “…arguably the best long-term growth project in our industry.” Suncor also achieved the East Tank Farm Development partnership with Fort McKay and Mikisew Cree First Nations in the quarter.
Other highlights from the latter part of the year include a Progressive Aboriginal Relations (PAR) gold level certification and the purchase of a 41% equity interest in PetroNor, a Quebec-based petroleum products distributor owned and operated by the James Bay Cree.
Suncor’s fourth quarter results will be issued Feb. 7, 2018.
