Canadian Oil Sands profit falls 20 pct on maintenance outages
CALGARY, Alberta, July 31 (Reuters) - Canadian Oil Sands Ltd , the largest shareholder in the Syncrude Canada Ltd joint venture, said on Thursday second-quarter profit fell by a one-fifth on lower production and higher government payments.
The company, which has a 37 percent stake in the Syncrude project, said net income fell 20 percent to C$176 million ($161.5 million), or 36 Canadian cents per share, from C$219 million, or 45 Canadian cents, in the second quarter of 2013.
Its profit for the quarter was affected by higher royalties and lower output from the northern Alberta oil sands mining project, the company said.
Sales volumes averaged 77,064 barrels per day, down 23 percent from 100,094 bpd in the year-prior quarter, because of an unplanned outage of a coker unit at the site and planned maintenance on a second coker, which helps process mined bitumen into refinery-ready synthetic crude.
Operating costs were C$418 million, up from C$394 million in the year-earlier quarter, because of higher maintenance costs and increased natural gas prices.
The Syncrude project, which can produce 350,000 barrels per day, has a history of unplanned shutdowns caused by equipment malfunctions, particularly at its complex upgraders, which convert tar-like bitumen stripped from the oil sands into refinery-ready synthetic crude.
The company said its Mildred Lake mine train replacement project at Syncrude is 94 percent complete and the equipment is expected to be in service by year end.
Canadian Oil Sands' cash flow, a measure of its ability to pay for new projects, fell 29 percent to C$240 million, or 50 Canadian cents, from C$340 million, or 70 Canadian cents.
Canadian Oil Sands shares fell 77 Canadian cents to C$23.29 on Thursday on the Toronto Stock Exchange.
($1 = 1.09 Canadian Dollars) (Reporting by Scott Haggett; Editing by Steve Orlofsky)
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