Suncor Q4 profit plunges on oil price slide, weaker oil sand output

Wed Feb 4, 2015 10:50pm EST
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CALGARY, Alberta Feb 4 (Reuters) - Suncor Energy Inc , Canada's largest oil and gas company, said on Wednesday its fourth-quarter profit tumbled more than 80 percent, hit by the rapid slide in oil prices and weaker output from its Alberta oil sands operations.

Struggling to cope with oil prices that have fallen by more than half since June, Suncor last month laid off 1,000 staff and contractors, deferred some oil sands projects and slashed C$1 billion from its capital-spending budget.

The world's largest oil sands producer said quarterly net income fell to C$84 million ($66.9 million), or 6 Canadian cents per share, down from C$443 million, or 30 Canadian cents in the same quarter a year earlier.

Operating earnings, which excludes most one-time items, fell 60 percent to C$386 million, or 27 Canadian cents per share, from C$973 million, or 66 Canadian cents.

The adjusted result lagged the average analyst forecast of 35 Canadian cents per share in a Thomson Reuters I/B/E/S survey.

It said output from its northern Alberta operations fell 6 percent to 384,200 bpd as unplanned maintenance at its project site hampered operations.

But production costs fell to C$34.45 from C$36.85 per barrel in the year-prior quarter. It did not give a reason for the decline in production costs.

The company produced a total 557,600 barrels of oil equivalent per day (boepd), down slightly from 558,100 boepd in the fourth quarter of 2013.

Along with its Alberta tar sands projects, Suncor produces oil off Canada's east coast, in the North Sea and elsewhere. It also owns refineries in Canada and the United States.

Cash flow, a key indicator of the company's ability to pay for new projects and drilling, fell to C$1.49 billion, or C$1.03 per share, from C$2.35 billion, or C$1.58 per share.

Prior to the earnings release, Suncor shares ended at C$37.49 on the Toronto Stock Exchange on Wednesday. The shares have risen 6.5 percent over the past 12 months. ($1 = 1.2553 Canadian dollars) (Reporting by Scott Haggett; Editing by Edwina Gibbs)