“Our view is that since we made the offer, crude prices have come down and most of the commentators now believe it’s lower for longer”, he said Thursday after discussing Suncor’s third-quarter results, which included a steep drop in operating earnings.
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Cash flow from operations fell to C$1.88B from C$2.28B a year ago, which the company said reflected “the lower upstream crude oil price environment”.
Barclays upgraded shares of Canadian Oil Sands (OTC:COSWF) from an underweight rating to an equal weight rating in a research note published on Wednesday morning, AnalystRatings.Net reports.
A Canadian Oil Sands takeover would increase Suncor’s stake in the Syncrude oil-sands consortium to 48.7%, but Mr. Williams said the company has no plans to take over the lead operator role “at this stage”.
Suncor updated its 2015 crude oil pricing, and now expects Brent to trade at US$55 a barrel from US$60 and USA crude to trade at US$50 a barrel from US$54 a barrel.
The Calgary-based company’s operations are mainly based in the oilsands of northern Alberta, where thousands of oil and gas worker layoffs and producers slashing capital spending have helped drive down production costs over the a year ago.
The CEO of Suncor Energy (TSX:SU) is throwing cold water on speculation that its hostile takeover offer for Canadian Oil Sands will be sweetened.
“We have been disappointed for with Syncrude’s performance for a few time now”, Suncor chief executive officer Steve Williams said in a statement Wednesday.
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This week, global oil giant Royal Dutch Shell PLC mothballed a major oil sands development and U.S.-based Devon Energy Corp. let go 15 per cent of its Canadian workforce, adding to thousands of job cuts across the sector. Suncor owns 12 per cent of the Syncrude project, which was temporarily shut down in September after a fire in a processing unit. Oil-sands output rose to 430,300 barrels a day, up 18,600 barrels a day on the year and above 423,800 barrels a day last quarter.
