UPDATE 1-Canadian Oil Sands says 2014 spending to fall 17 percent

Mon Dec 9, 2013 5:48pm EST
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CALGARY, Alberta Dec 9 (Reuters) - Canadian Oil Sands Ltd , which has the largest stake in Syncrude Canada Ltd oil sands project in northern Alberta, said on Monday it expects spending to drop by 17 percent in 2014 as it completes major projects at its mine site.

The company, which has a 37 percent stake in Syncrude, said the spending cut to C$1.1 billion ($1.03 billion), comes as long-term projects like the relocation of production trains at its Aurora North Mine and a tailings management project wrapped up in 2013.

Canadian Oil Sands said it expects to spend C$653 million on major projects in 2014, down 22 percent from its C$842 million estimate for this year.

Its share of maintenance spending is estimated at C$361 million, up 4.3 percent, which includes a maintenance turnaround at its 8-2 coker unit, part of a complex that converts mined bitumen into refinery-ready synthetic crude.

Canadian Oil Sands said it expects Syncrude to produce between 95 million and 110 million barrels in 2014, or about 281,000 barrels per day at the midpoint of the estimate, up four percent from an estimated 270,000 bpd this year.

Costs per barrel are pegged at C$41.48, slightly lower than the C$41.77 per barrel 2013 estimate.

Cash flow, an indicator of the company's ability to fund development and pay out dividends, is estimated at C$1.16 billion, or C$2.39 per share, for 2014, down from its C$2.75 per share estimate for this year, the company said.

Canadian Oil Sands shares closed at C$20.09 on the Toronto Stock Exchange on Monday. The shares have dropped 2.8 percent over the past 12 months against an 8.2 percent rise in the exchange's main energy index over the same period.

The company's partners in the project are Imperial Oil Ltd , Suncor Energy Inc, CNOOC Ltd, Sinopec, JX Holdings Inc's Mocal Energy and Murphy Oil Corp