Suncor Posts First Quarterly Loss and Cuts Capital Spending by $3 Billion

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Researched by Industrial Info Resources (Sugar Land, Texas)--Suncor Energy Incorporated (TSX:SU) (Calgary, Alberta), Canada's second largest oil sands producer, has cut its planned 2009 capital expenditures by half to $3 billion after posting its first-ever quarterly loss. Plunging commodity prices as well as the economic downturn contributed to the company's fourth-quarter 2008 loss of $215 million, compared with net earnings of $1.04 billion in the same period last year. "With market conditions limiting our growth capital spending in 2009, we will be tightly focused on getting full value from our existing assets," President and CEO Rick George said in a statement.

For the full year, Suncor's net earnings totaled $2.14 billion, compared with $2.98 billion in 2007. Adding to a challenging year were unscheduled maintenance shutdowns at the company's oil sands operations, George said. Oil sands production dipped 3.2% to 228,000 barrels per day (BBL/d) in 2008 compared with 235,600 BBL/d in 2007. Oil sands operating costs averaged about $38.5 per barrel in the past year, compared with $27.8 in 2007.

In an effort to control costs, Suncor is suspending construction activity of its Voyageur upgrader and Firebag projects. Industrial Info is tracking 37 active Suncor projects as part of our North American Project Database, which includes details on the Voyageur upgrader and Firebag projects. The completion date for the Voyageur project has been pushed back one year, Suncor announced. For more information regarding Suncor's planned expenditures, view related October 28, 2008, news article - Suncor Energy Allocates $5.3 Billion to Oil Sands Projects in 2009.

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