August 12, 2010 / 3:32 PM / 7 years ago

Connacher shares fall as production woes hurt Q2, outlook

Aug 12 (Reuters) - Shares of Connacher Oil & Gas Ltd CLL.TO fell 7 percent on Thursday, a day after the oil sands developer posted a second-quarter loss and warned of lower production at its major project, hurt by power outages and pump failures.

Production from the oil sands project at Great Divide Pod One, which has a capacity of 10,000 barrels a day (bbl/d) of bitumen, is now expected to average 7,200 bbl/d, down 15 percent from its previous estimate, the company said on Thursday.

Shares of the Canadian company, which have fallen 16 percent in the past three months, fell a further 7 percent on Thursday to a low of C$1.29 in heavy trade on the Toronto Stock Exchange.

Connacher’s cash flow of 2 Canadian cents a share fell short of market expectations by one cent, hurt by lower bitumen production and pricing and higher operating costs, Credit Suisse analyst Jason Frew said in a note to clients.

Frew cut his price target on the company by 10 Canadian cents to C$1.80.

On Thursday, Connacher posted a second-quarter loss hurt by lower production. Bitumen production was 6,211 bbl/d. [ID:nSGE67A0K0]. (Reporting by Savio D‘Souza in Bangalore; Editing by Vyas Mohan)

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