Wed, Sep. 16, 11:31 AM
- Canadian Natural Resources (CNQ +5.8%) is the latest Canadian oil sands producer looking to cut costs, saying it plans to cut operating costs by $390M more than currently budgeted this year.
- CNQ, which has operating costs of ~US$30/bbl, hopes to lower that figure to $25-$27 within the next few years, to shield itself from U.S. crude prices that have been stuck below $50 in recent months.
- Cenovus Energy (CVE +6.5%) also says it is looking to aggressively slash costs, not satisfied with total costs of $11-$14/bbl and targeting a $1-$2/bbl reduction.
- Suncor Energy (SU +4.2%) has seen its cash operating costs fall to $28.20/bbl in H1 of the year, compared to $33.80 last year.
Thu, Sep. 10, 2:57 PM
- Canadian Natural Resources (CNQ +1.8%) says it is cutting salaries for all staff in Calgary and Aberdeen, Scotland, by as much as 10%, citing low oil prices and the "current fiscal and regulatory challenges."
- CNQ says it is not cutting its workforce of more than 7,600 employees across operations in North America, Europe and Africa.
- CNQ does not say how much in total it expects to save via the salary reductions.
Wed, Sep. 2, 6:47 PM
- Analysts at RBC Capital add five names - CNQ, OTCPK:DTNOY, WES, WFT and EXH - to the firm's Global Energy Best Ideas List, and removes five names.
- Canadian Natural Resources is well positioned to benefit from a rebound in crude oil as the largest heavy oil producer in Canada; DNO's near-term outlook is "set to be dominated" by regular oil payments from Kurdistan; Western Gas Partners is a defensive play given its solid but with ssignificant growth potential; Weatherford is the "next man up" on the M&A front; and Exterran Holdings is viewed favorably ahead of the proposed spin transaction.
- Removed from the RBC list: CAM, MIC, PDS, OTC:SECYF, OTCPK:AOIFF.
Fri, Aug. 28, 2:28 PM
- Alberta's new government launches its royalty review panel, and says it will not raise oil and gas royalty rates until the end of 2016.
- The specter of a higher government take is spooking the industry, especially with oil prices recently hitting more than six-year lows; some have argued the royalty review should be deferred until the outlook improves, while others would prefer to just get it over with.
- Related tickers: SU, ENB, IMO, TRP, CNQ, CVE, TCK, CEO, OTCPK:HUSKF, OTCQX:COSWF
Wed, Aug. 26, 11:43 AM
- Canadian Natural Resources (CNQ -0.4%) is downgraded to Neutral from Overweight with a $36 price target at J.P. Morgan, which believes "balance sheet pressures could build in 2016 at a time when the company’s hedges are rolling off.”
- The firm says CNQ has done well in controlling operating costs while aggressively cutting down on capital cost in 2015, but the company will need capital for the Horizon ramp in 2016, which JPM expects to be higher than in 2015, meaning CNQ would face challenges to cutting capex and likely see an impact on production, which is expected to decline in 2016.
- The firm thinks CNQ's 2016 consensus earnings expectations appear too high, even assuming a higher oil price curve.
Thu, Aug. 13, 12:45 PM
- A key pipeline for delivering Canadian oil to the U.S. remains shut for a third day, leaving heavy crude stranded in Alberta and keeping its price in the cash market at ~$20 below the WTI benchmark.
- A small leak near Shelbina, Mo., coming from Enbridge’s (ENB -1.1%) Spearhead pipeline, which runs from Flanagan, Ill., to the Cushing, Okla., crude hub forced the shutdown Tuesday of the 193.3K bbl/day pipeline as well as a closing of the parallel Flanagan South pipeline, an even larger 585K bbl/day line that runs from Pontiac, Ill., to Cushing.
- ENB expects operations at Flanagan South to resume today, but does not know when Spearhead may return to service, as it continues to investigate the cause of the spill in Missouri.
- Operational problems at BP's (BP -1.5%) Whiting, Ind., refinery also keep the pressure on prices for Canada’s heavy crude as barrels continue to get backed up.
- Other related tickers: SU, IMO, TRP, CNQ, CVE, TCK, CEO, OTCPK:HUSKF, OTCQX:COSWF
- Earlier: Canadian oil sands price nears $20/bbl, cut in half since July 1
Wed, Aug. 12, 12:27 PM
- Crude oil from Canada’s tar sands has slumped to $23/bbl, chopped in half since July 1 and widening its discount to West Texas Intermediate to nearly $20/bbl, due to a combination of steadily rising production, pipeline constraints and an unexpected outage at a U.S. refinery.
- The price plunge has done little to curb output because oil sands projects require years to plan, construct and pay back; Imperial Oil (NYSEMKT:IMO) recently doubled production capacity at its Kearl oil sands project to 220K bbl/day, and Canadian Natural Resources (NYSE:CNQ) last week said it was built to withstand low commodity prices even as it lost C$405M in Q2.
- At current oil prices, typical oil sands producers are just covering their operating costs, while companies with higher operating costs are “losing money with each barrel they’re producing," says the VP of energy research at ARC Financial in Calgary.
- The results have spilled beyond the oil market into Canada’s economy, forcing the central bank to twice cut interest rates, driving the Canadian dollar to a decade low and impacting the debate ahead of October's federal election.
- Other related tickers: TRP, ENB, SU, CVE, TCK, CEO, OTCPK:HUSKF
Thu, Aug. 6, 2:44 PM
- Canadian Natural Resources (CNQ +1.8%) is higher after reporting better than expected Q2 earnings, although the $0.16 EPS was far below the $1.04 posted in the year-ago quarter.
- CNQ blamed its unadjusted $405M Q2 loss on taking a $579M deferred income tax charge to account for Alberta’s decision to hike provincial corporate income tax rate to 12% from 10% effective July 1; the charge "effectively translates into lower future cash flows and therefore, lowers reinvestment in the business,” CFO Corey Bieber said.
- Overall Q2 production fell 1.5% Y/Y to ~805K boe/day; drilling activity included 13 net wells, down 93% Y/Y due to lower crude oil and natural gas prices.
- CNQ says it Q2 crude oil and natural gas liquids production fell to an average of 509K bbl/day from ~545K a year ago, partly because of wildfires in Alberta that temporarily slowed output; for the full year, CNQ maintains its crude and NGL production forecast at 562K-602K bbl/day.
- CNQ again cut its capital spending program, this time by C$245M to bring it to C$5.5B this year after announcing spending cuts three times earlier this year.
- Cash flow at the end of Q2 was $1.5B, down from $2.87B a year earlier.
Thu, Aug. 6, 5:50 AM
Thu, Aug. 6, 5:40 AM
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Tue, Jul. 28, 1:12 PM
- Canada oil sands pipeline projects look doomed after the recent Nexen oil spill leaves "two big football fields of black goo," according to a Bloomberg analysis.
- A rupture in a line operated by the Cnooc (NYSE:CEO) unit that spewed 31K barrels of bitumen, waste water and sand has ignited outrage from communities along pipeline routes and is strengthening opposition that already has stalled every major crude export project from Canada and may lead to stricter regulations, the report says.
- The Alberta Energy Regulator could consider new requirements including scheduled and random inspections of pipelines during construction and while in operation, as well as better spill detection technology; meanwhile, the spill gets bad press in Canadian newspapers every day.
- Related tickers: TRP, ENB, SU, IMO, CNQ, CVE, TCK, OTCPK:HUSKF, OTCQX:COSWF
Mon, Jul. 13, 5:38 PM
- Weakness in oil stocks should not be used as a buying opportunity, Barclays analysts say, viewing shares as significantly overvalued and appearing to discount an average oil price of $85-$90/bbl based on group average historical multiples.
- The firm removes Newfield Exploration (NYSE:NFX) and Cabot Oil & Gas (NYSE:COG) from its list of top oil and gas stocks, leaving only Canadian Natural Resource (NYSE:CNQ), EOG Resources (NYSE:EOG), Southwestern Energy (NYSE:SWN), Noble Energy (NYSE:NBL) and Concho Resources (NYSE:CXO).
- Barclays' bottom group consists of five Underweight rated stocks - CHK, OTCQX:COSWF, PXD, OXY and UPL - while WPX Energy (NYSE:WPX) is bumped off the bottom list to reflect an improved outlook as well as a 20%-plus share price decline.
Fri, Jun. 26, 4:58 PM
- Alberta's government names the top executive of a province-owned bank, ATB Financial CEO Dave Mowat, to head a panel to review oil and natural gas royalty payments and issue recommendations by year’s end.
- The announcement to move ahead with the royalty review, even as oil-rich Alberta struggles with sharply lower crude prices, comes a day after the province said it would double a carbon tax levied on large-scale emitters of greenhouse gases over the next two years.
- Alberta is home of the Canadian subsidiaries of energy giants Exxon Mobil (XOM, IMO), Royal Dutch Shell (RDS.A, RDS.B) and Total (NYSE:TOT), among others.
- Among other top Alberta oil producers: SU, OTCPK:HUSKF, CVE, CNQ, ECA, TLM, OTCQX:COSWF, CPG, OTCPK:PEGFF
Thu, Jun. 25, 1:04 PM
- Alberta's new government says it will raise the province's existing carbon tax on industrial emitters starting next year, the first step in revamping regulations to curb rising greenhouse gas output from surging oil sands production.
- The price will rise to C$20/metric ton in 2016 from C$15 now, and increase to C$30 in 2017, when the rules will expire, the environment ministry says; large emitters will be required to reduce emissions by 15% next year and 20% in 2017, compared with a 12% reduction this year.
- Alberta’s oil sands have become a target for environmentalists because of their significant carbon footprint, and the new NDP government had campaigned on a promise to toughen the province’s environmental standards.
- Among Alberta's top oil producers: SU, IMO, XOM, OTCPK:HUSKF, CVE, CNQ, ECA, TLM, OTCQX:COSWF, CPG, OTCPK:PEGFF
Thu, Jun. 18, 10:18 AM
- Concerned that pledges by the newly elected left-leaning government in Alberta may stifle spending by energy companies and kill jobs, Canadian Natural Resources (CNQ +0.5%) President Steve Laut says his company is considering shifting investment away from the province.
- While ~73% of CNQ's assets are in Alberta, Canada's largest heavy oil producer could devote more spending to operations in Africa, the North Sea, Saskatchewan and British Columbia, Laut says.
- Earlier this week, new Premier Rachel Notley said the government will push ahead with a tax increase for corporations to 12% from the current 10%, policies critics say will prove hostile to the province's dominant oil and gas sector and accelerate its downward spiral.
- Laut also expresses measured support for a carbon pricing system in Alberta, but only if the program is used to fund new technology to reduce greenhouse gases, in a somewhat different take than the broad support recently offered by Suncor (SU -0.2%) CEO Steve Williams.
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