July 27, 2011 / 10:19 AM / in 7 years

UPDATE 1-MEG Energy reports Q2 profit on higher output, lower costs

* Q2 EPS C$0.21 vs last year loss C$0.21/shr

* Q2 production rises slightly to 27,826 bbl/d

* Reiterates FY11 output forecast

* Expects capital investment of about $1 bln (Follows alerts)

July 27 (Reuters) - Canadian oil sands developer MEG Energy Corp reported a second-quarter profit, helped by higher production and lower operating costs, and also reiterated its production forecast for the year.

The company said 2011 output is expected to average 25,000-27,000 barrels of bitumen per day (bbls/d)and capital investment is expected to be about $1 billion.

For the quarter ended June 30, the company earned C$42.5 million, or 21 Canadian cents per share, compared with loss of C$34.9 million, or 21 Canadian cents a share, a year ago.

The company, which made its debut on the Toronto Stock Exchange last August, said production in the quarter averaged 27,826 bbls/d, up slightly from 27,653 bbls/d a year ago.

Operating costs during the second quarter were $14.13 per barrel compared with $17.84 per barrel a year ago.

Shares of the Calgary, Alberta-based company closed at C$52.03 on Tuesday on the Toronto Stock Exchange. (Reporting by Amruta Sabnis in Bangalore)

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