By November 17, 2017 Read More →

Suncor to increase production in 2018 while capital spending drops $750 million


Suncor oil sands operation

Oil sands cash costs per barrel are $23-26 dollars

Suncor released its 2018 corporate guidance today which includes a capital program of between $4.5 and $5.0 billion and average upstream production of 740,000 to 780,000 boe/d, according to a press release.

The midpoints of these ranges represent a year over year production increase of more than 10 per cent and a capital spending reduction of $750 million.

“During an extended period of low oil prices, we’ve demonstrated that we can generate significant free cash flow and strong returns for shareholders while continuing to drive down our operating costs and delivering significant future growth by executing two major projects,” said Steve Williams, president and CEO.


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Suncor’s oil sands operations cash operating costs per barrel are maintained at $23.00 – $26.00 despite the five-year major planned maintenance turnaround at Upgrader 1.¬†Oil Sands operations cash operating costs exclude Fort Hills and Syncrude.

Fort Hills cash operating costs are expected to steadily decrease throughout the year as production ramps up to 90 per cent of capacity and cash operating costs fall to the $20.00 – $30.00/bbl range by the fourth quarter of 2018.

Syncrude cash operating costs per barrel are expected to be $32.50 – $35.50.

“With first oil at both Fort Hills and Hebron expected by year end, we’re bringing on new production at the same time as oil prices are rising to their highest level in several years,” said Williams.

Suncor’s 2018 capital program is largely focused on sustaining capital given the major planned maintenance programs in both oil sands upgrading operations and downstream refineries including a total plant turnaround at the Edmonton refinery.

These investments are critical to ensure continued safe, reliable and efficient operations, according to Suncor.

Approximately 25 per cent of the 2018 capital spending program is allocated towards upstream growth projects in the Oil Sands and Exploration & Production businesses.

“As we look to 2018, with increasing production and reduced capital spending, we’re well-positioned to return more free cash flow to shareholders through dividends and share buybacks,” concluded Williams.

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