Fri, Nov. 27, 1:48 PM
- The increasingly bitter fight over Canadian Oil Sands' (OTCQX:COSWF) potential to attract bids to rival Suncor Energy’s (NYSE:SU) $4.3B hostile takeover offer led to tense exchanges at yesterday's Alberta Securities Commission hearing.
- A representative with J.P. Morgan, SU's advisor and supporting the company’s position that COSWF should not be allowed to change its shareholder rights plan in an attempt to fight off the takeover offer, said no one was likely to make a competing bid for COSWF.
- The rep said the possibility that Imperial Oil and its parent company Exxon Mobil, long rumored as suitors, was remote since neither had made an offer to date, even though either could do so quickly given IMO's ownership of 25% of Syncrude.
- The Canadian Oil Sands rep RBC, however, said 25 interested parties were reviewing the "opportunity," with four signing confidentiality agreements and "a good prospect" for at least one proposal.
- The Commission is expected to issue its decision on the COSWF shareholder rights plan before SU’s Dec. 4 deadline; if it rules in favor of COSWF, then shareholders would have until early April to make a decision if the SU bid is not withdrawn before then.
Mon, Nov. 23, 8:19 AM
- Alberta's government announces plans to cap oil sands emissions for producers, phase out coal power plants and implement a carbon tax in an effort to curb pollution.
- The provincial government in impose a limit of 100 megatons/year of carbon emissions, above current annual emissions of ~70 megatons, phase out coal power plants by 2030, and set a carbon price of C$20/metric ton (US$15) by 2017 which rises to C$30 in 2018.
- The Canadian Association of Petroleum Producers supports the initiative, saying it could help improve Alberta’s image in markets to which oil sands producers hope to expand access.
- "This will create a wealth of opportunities and jobs for generations to come. We in Alberta want to take a leadership role on climate," says Suncor (NYSE:SU) CEO Steve Williams.
- Coal producers criticized the new policy, however, saying it will raise electricity costs in Alberta and cost Canadian jobs.
- Other relevant tickers: TRP, ENB, IMO, XOM, RDS.A, RDS.B, OTCQX:COSWF, OTCPK:HUSKF, CVE, CNQ
Wed, Nov. 18, 5:41 PM
- Suncor Energy (NYSE:SU) CEO Steven Williams says he wants to take advantage of the industry downturn to get even bigger by seeking more assets in Canada’s oil sands, as competitors struggle or walk away from bitumen production in Alberta.
- "We’re starting to bust this paradigm of Canadian oil sands being expensive,” Williams tells Bloomberg. “We prepared ourselves well, we managed the cost side of our business, and we have generated cash in each of our quarters. We’re one of the few oil companies in the world to do that.”
- SU, which is trying for a hostile takeover of Canadian Oil Sands, will pursue other consolidation opportunities in the industry, Williams says, but adds that SU has offered a full and fair price and will not raise the offer for its partner in the Syncrude oil sands project.
- Earlier: Suncor sinks on plans for higher 2016 spending, lower production
Wed, Nov. 18, 11:49 AM
- Suncor Energy (SU -4.3%) is downgraded to Hold from Buy with a price target of C$43 at TD Securities following the company's disappointing 2016 guidance.
- Despite SU's strong structural advantages in this market, the firm says its downward adjustments to its 2016 estimates after the company's update precipitate the downgrade.
- TD says SU's relative value suggest it is now the most expensive large-cap on a price/NAV basis, and recent share price outperformance has resulted in the highest total return of any large-cap since the beginning of the oil price rout.
Wed, Nov. 18, 10:27 AM
- Suncor Energy (SU -3.2%) opens sharply lower after announcing a larger capital budget for 2016 even as it forecasts lower production volumes.
- SU says it plans to boost capital spending to as much as C$7.3B (US$5.5B) next year, an increase from ~C$6.3B this year; SU says the program is flexible, within a range starting at C$6.7B, to respond quickly to any further deterioration in market conditions.
- SU sees 2016 production of 525K-565K bbl/day, below earlier guidance of 540K-580K bbl/day for the current year, citing scheduled maintenance at its oil sands plants for the reduction.
- Oil sands production is expected to total 400K-425K bbl/day, not including an additional 30K-35K bbl/day from its interest in Syncrude; the range is below this year’s estimate for oil sands output of 410K-440K bbl/day, not including 32K-36K bbl/day from Syncrude.
- As a result of cost-cutting efforts, SU says its oil sands cash operating costs would fall to C$27-C$30/bbl next year, below the C$28-C$31 it projects for this year.
Tue, Nov. 17, 7:21 AM
Mon, Nov. 16, 7:46 AM
- The latest 13F from Berkshire Hathaway (BRK.A, BRK.B) shows a new 59.3M share stake in AT&T (NYSE:T), and the GM stake taken up to 50M shares from 41M. At least part, if not all of the T stake is the result of shares received in the DirecTV merger.
- Phillips 66 (NYSE:PSX) is up to 61.5M shares from about 30M; Kraft Heinz (NASDAQ:KHC) 325.6M shares from zero; Suncor (NYSE:SU) 30M shares from 23.3M, John Malone (LMCK, LMCA) a total of about 24M shares from about 13M.
- Buffett trimmed his Wal-Mart (NYSE:WMT) position to 56.2M shares from 58.3M.
- AT&T +1.4% premarket
Thu, Nov. 12, 7:11 PM
- Hard-hit Canadian energy producers, coming off a bleak Q3 earnings season, are signaling they will cut capital spending for a second straight year in 2016, Reuters reports.
- The seven biggest Canadian producers cut 2015 capital spending by 39%, or a combined C$12B, from last year, and Eric Nuttall, portfolio manager at Sprott Asset Management, expects another 10%-20% reduction for 2016.
- Of the seven, so far only Cenovus Energy (NYSE:CVE) and Canadian Natural Resources (NYSE:CNQ) have outlined 2016 budgets; CVE estimates 2016 capex of C$1.5B-C$2B vs. C$1.8B-$1.9B in 2015, and CNQ expects to spend C$4.5B-C$5B next year from C$5.44B in 2015.
- Encana (NYSE:ECA) today bucked the trend a bit by speeding up investment in the U.S. Permian Basin this year but is using capital originally earmarked for 2016; the company suggested in its earnings conference call that 2016 spending will be carefully controlled.
- Also: SU, TRP, ENB, IMO, OTCPK:HUSKF
Thu, Nov. 12, 10:54 AM
- Suncor Energy (SU -0.6%) sends a letter to Canadian Oil Sands (OTCQX:COSWF -0.6%) shareholders urging them to disregard their board of directors and accept its hostile C$4.7B ($3.5B) takeover offer.
- SU says COSWF shareholders should accept its offer, given the later's "track record of underperformance, financial challenges and significant vulnerability in a 'lower for longer' oil price market."
- SU says the potential premium of its offer has increased to 57% from 43% compared with the pre-offer trading price of $6.19 because of the substantial increase in the price of SU shares, which closed at $38.97 on the TSX on Nov. 9 from a pre-offer closing price of $35.37 on Oct. 2.
Fri, Nov. 6, 7:57 AM
- Suncor Energy (NYSE:SU) says its effort to get the poison pill adopted by Canadian Oil Sands (OTCQX:COSWF) thrown out will be heard on Nov. 26 by Alberta’s securities regulator, following SU's application for an order to stop the new shareholder rights plan.
- SU launched its hostile takeover bid for COSWF in early October, prompting the target company’s board to implement the rights plan that requires bids to be open for 120 days; SU’s bid expires Dec. 4, and it calls the move by COSWF a stalling tactic and wants the Alberta Securities Commission to strike it down.
- COSWF calls SU's move a "smokescreen" intended to obscure a weak offer and says it will oppose the application.
Thu, Nov. 5, 1:12 PM
- TransCanada (TRP -0.2%) says it will scrap plans for a marine terminal in Quebec to go with its Energy East pipeline, and will amend its application with Canadian regulators for the C$12B ($9.1B) oil pipeline before the end of the year.
- The project, which would carry 1.1M bbl/day from western Canada to a port on the Atlantic coast, still will supply Quebec refineries owned by Suncor Energy (SU -0.1%) and Valero Energy (VLO +1.4%).
- TRP had been studying alternative sites for the terminal after abandoning plans in April for a facility in the town of Cacouna because of concerns about the threat to endangered beluga whales.
Thu, Oct. 29, 6:25 PM
- Canadian Oil Sands (OTCQX:COSWF) reiterates its rejection of Suncor Energy's (NYSE:SU) hostile takeover offer, and says it is considering alternatives including a potential sale of the company or a merger or partnership with a strategic or financial partner.
- In its Q3 earnings, COSWF says cash flow from operations fell 73% Y/Y to C$82M, or C$0.17/share, from C$302M, or C$0.62/share, a year ago, partly due to a 41% drop in realized selling prices for synthetic crude oil from Syncrude to C$60.20/bbl from C$102.58/bbl.
- The company cuts its full-year cash flow from operations forecast to C$340M from a July estimate of C$474M, as it expects continued low crude oil prices.
- COSWF says its overall Q3 total sales volumes fell partly because of an August fire at Syncrude’s main oil sands plant, which reduced output by 7M barrels Q/Q to 86,687 bbl/day and by 2.6M barrels Q/Q net to the company.
- COSWF holds the largest stake in the Syncrude oil sands project, while joint venture partner SU owns 12%.
Wed, Oct. 28, 10:22 PM
- Suncor Energy (NYSE:SU) is the first major Canadian energy producer to post Q3 earnings, and its weak results are expected to be replicated by the others when they report later this week.
- SU's unadjusted Q3 loss totaled C$376M, including a C$786M unrealized foreign exchange loss on the revaluation of U.S. dollar-denominated debt; a year ago, the company recorded a C$919M profit.
- 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.”
- SU says overall Q3 production rose to 566.1K boe/day from 519.3K boe/day a year ago, primarily the result of increased production in the U.K.; oil sands output rose to 430.3K bbl/day from 411.7K bbl/day a year ago.
- SU's average Q3 sales prices for its oil sands output was C$47.93/bbl, down from $60.81 in Q2 and $89.38 in Q3 2014.
- SU maintains its full-year production forecast of 550K-595K boe/day and keeps its full-year capex outlook unchanged at C$5.8B-C$6.4B, although its original spending target was C$7.8B; the dividend is maintained at $0.29/share.
- The company touts its oil sands performance in support of its hostile bid for Canadian Oil Sands (OTCQX:COSWF), saying it has managed to run its upgrading operations that process bitumen into light crude at more than 90% of capacity this year, compared with an average 70% for Syncrude.
Wed, Oct. 28, 9:37 PM
Tue, Oct. 27, 7:37 PM
- Energy-dependent Alberta today unveiled its 2015 budget, the first under the new NDP government, projecting a record deficit on falling revenue linked to the sharp slump in crude oil prices.
- It's a spend and borrow budget that will see the province borrowing for operating for the first time in two decades, promising to spend an additional C$4.5B above previous commitments over the next five years for infrastructure such as new transportation projects and hospitals.
- As for the oil sector, which is pleading for a three-year lag before royalties are changed, Finance Minister Ceci indicated no letup from the NDP's promise of royalty increases and tougher climate change regulations once reviews now underway are completed over the next few months.
- Relevant tickers: SU, ENB, TRP, KMI, IMO, CVE, CNQ, OTCPK:HUSKF, OTCQX:COSWF.
Tue, Oct. 27, 5:35 PM
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Suncor Energy Inc is an integrated energy company. Its operations include developing petroleum resource basin, Canada's Athabasca oil sands. It explores for, acquires, develops, produces & markets crude oil & natural gas in Canada and internationally.
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