Q2 results showed capital spending from a broad list of about 40 publicly traded Canadian producers tracked by BOE Intel fell for the first time in 11 quarters. Total capital spending (not including A&D) for the group of publicly traded companies fell from ~$8.8 billion to ~$8.3 billion, a drop of about 6%.
Figure 1
Among some of the larger producers, Canadian Natural Resources and Suncor saw heavy capital spending in Q2. Both companies saw quarterly capex hit multi year highs. In contrast, Tourmaline pulled back on its capital expenditures, and saw a seasonal dip in Q2 which tends to occur every year, possibly due to spring breakup conditions.
Figure 2
Quarterly operating cash flow for all BOE Intel public companies has fallen by ~46% (or $12.5 billion) from peak levels in Q3 of 2022, so perhaps it’s not surprising to see the lagged effect from this on capital spending. Natural gas producers are showing a little bit more caution than on the oil/liquids side, as Q2 results showed a marked difference in the two groups.
Figure 3
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