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Suncor lowers expectations for 2016

Suncor lowers expectations for 2016

Suncor Energy provided an operational update today and lowered production targets for the full year. 

The company confirmed that both the MacKay River and Firebag thermal in-situ facilities are in the process of ramping back up and should be back to pre-fire production levels by the end of June. McKay River and Firebag are both SAGD operations (steam-assisted gravity drainage), producing about 260,000 bbl/day of heavy oil. Roughly half of that production is upgraded at the Suncor's Base Plant operations. The remainder is diluted and sold directly to market as diluted bitumen.

 SAGD FACILITY 
FIREBAG
MACKAY RIVER
 CAPACITY 
230,000 bpcd
34,500 bpcd
 AVG PRODOCTION 
Q1/16 @ 199,000 bpcd • 2015 @ 186,900 bpcd
Q1/16 @ 36,800 bpcd • 2015 @ 30,700 bpcd
 PRODUCT 
55% sold as Borealis Heavy Blend (BHB) • 45% processed at Suncor Upgrader
 SPECS 
BHB @ 21.5° API • 3.8% sulphur

Suncor's U2 upgrader located at Base Plant operations is currently undergoing a planned maintenance turnaround. The company reported that all mining and upgrading operations should also be back to normal by the end of June. 

MINE 
MILLENNIUM
STEEPBANK
CRUSHER FEED RATE 
14,000 tph nominal
12,000 tph nominal
NAMEPLATE 
180,000 bbl/day
150,000 bbl/day
2016 PERFORMANCE 
Q1/16 @ 302,875 bbl/day
UPGRADER 
UPGRADER 1&2
UPGRADER CAPACITY 
357,000 bpcd
2015 AVG PRODUCTION 
326,986 bpcd
PRODUCT 
Suncor Sweet Synthetic Crude
SPECS 
33.0° API • 0.2% sulphur
OPERATING COSTS 
Q1/16 @ $24.25/bbl • 2015 @ $27.85/bbl (incl. upgrading)

Oil sands production is now expected to average 375,000 to 395,000 bb/day in 2016, revised lower from previous estimates of 400,000 to 425,000 bbl/day. Operating costs were not revised, still expected to be between $27 and $30/bbl. Interestingly enough, Suncor noted the added costs of the fire response were more than offset by savings incurred by being offline.

Construction at the Fort Hills Mine was also reported to be back to normal.

Fort Hills, Firebag and MacKay River are remote fly-in/fly-out operations. Suncor's Base Plant is only 30 km north of Fort McMurray, with most staff residing in the city.

Although there was no damage reported to any of Suncor's assets, the company is looking at enhanced fire mitigation at its sites. 

Suncor's Edmonton refinery experienced an unplanned outage of its catalytic cracker a few weeks ago, resulting in a shortage of gas at Petro-Canada stations throughout Alberta and parts of Saskatchewan. The refinery is expected to be back to full production by the end of this week.

Revised full year guidance for 2016 is available on Suncor's website.

Minor damage reported at Surmont as production resumes

Minor damage reported at Surmont as production resumes

Cushing inventories enter the yellow zone

Cushing inventories enter the yellow zone