Suncor reports fourth-quarter loss, slashes 2016 capital budget

Wed Feb 3, 2016 9:02pm EST
 
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By Nia Williams

CALGARY, Alberta (Reuters) - Suncor Energy Inc (SU.TO: Quote), Canada's largest oil and gas company, reported a fourth-quarter operating loss and cut 2016 capital spending plans on Wednesday because of the collapse in global crude prices.

The Calgary-based company's operating loss was C$26 million, or 2 Canadian cents a share, versus operating earnings of C$386 million, or 27 Canadian cents a share, in the year-ago period.

It fell short of market expectations of operating earnings of 10 cents a share, underlining how even the biggest oil sands producers are struggling to cope with slumping prices.

Suncor also reported a C$2 billion ($1.46 billion) net loss, or C$1.38 a common share, because of asset writedowns as a result of the weak commodity price environment and unrealized foreign exchange losses on U.S. dollar-denominated debt.

In the year-prior quarter, net earnings were C$84 million, or 6 Canadian cents a share.

The company slashed its 2016 capital budget to C$6 billion to C$6.5 billion, from guidance of C$6.7 billion to C$7.3 billion issued in November, in part by deferring planned maintenance at its Firebag oil sands project in northern Alberta until 2017.

Capacity at that facility rose to 203,000 barrels per day from 180,000 bpd as a result of greater efficiencies.

The bulk of Suncor's operations are based in the oil sands, where producers have aggressively slashed capital budgets and cut tens of thousands of oil and gas jobs to help drive production costs lower. The company also has operations offshore Atlantic Canada, in the North Sea and in Libya.   Continued...