Canadian Natural Resources' profit beats estimates

Thu Mar 2, 2017 1:59pm EST
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(Reuters) - Canadian Natural Resources Ltd (CNQ.TO: Quote) CNQ.N, Canada's largest independent petroleum producer, on Thursday reported a quarterly profit that blew past analysts' expectations, driven by higher realized prices from North America and low costs.

The company said strong production and record low operating costs was driving its cash flow, which is targeted to exceed capital expenditures by about C$230 million ($172 million) per month. The company raised its quarterly dividend by 10 percent.

In a later conference call, company executives predicted possible "opportunistic acquisitions," but did not name them, saying it will buy only ones that "fit" and "add value."

The company may also sell some assets that produce about 1,000 barrels of oil equivalent per day (boepd) and are not "material components" of the company, executives said.

Canadian Natural, which operates in Western Canada, the North Sea and offshore West Africa, said fund flow from operations rose to C$1.68 billion in the fourth quarter from C$1.38 billion a year earlier.

The company did not express concern about a potential border tax that the U.S. administration has talked about, which could affect the energy sector as nearly all of Canada's crude production is exported south.

"The border tax would probably have a big impact on the Canadian dollar, would drop our costs ... we may be indifferent," President Steve Laut said, adding the tax and its terms are still uncertain.

The company said oil and gas production rose marginally to 859,577 boepd from 855,800 boepd.

However, average realized prices, before hedging, rose nearly 33 percent for crude oil and 6 percent for natural gas. Its operating costs were a record low C$22.53 per barrel in the quarter.   Continued...