CALGARY – Suncor Energy Inc. remains a foe of the Alberta government-ordered oil production curtailments, but new CEO Mark Little says the program was actually “slightly positive” for the company’s financial results in the first quarter.
The Calgary-based oilsands producer and refining giant says net income for the first three months of the year beat analyst expectations thanks to higher oil prices, record downstream results, growing oilsands production and a $264-million after-tax insurance gain on its assets in Libya.
Little, who takes over as chief executive from Steve Williams at the company’s annual meeting today, says the results show the value of Suncor’s integrated business model and extensive pipeline contracts at a time of turmoil in the industry.
Alberta’s decision to impose quotas on its biggest oil producers was designed to free up pipeline space and draw down crude storage after price discounts on western Canadian oil spiked last autumn.
The move was welcomed by oilsands producers like Cenovus Energy Inc., but opposed by rivals such as Imperial Oil Ltd., which noted that crude-by-rail exports plunged in February — which means export capacity was actually reduced.
Suncor says its average realized price rose to $62.92 per barrel for bitumen from its Fort Hills oilsands mine in the first quarter, up from $30.57 in the fourth quarter of 2018, as oil price discounts eased.
The company reported net earnings of $1.47 billion or 93 cents per share in the three months ended March 31, up from $789 million or 48 cents in the same period of 2018.