Tue, Apr. 14, 12:58 PM
- Canadian Oil Sands (OTCQX:COSWF +5.5%), the company with the largest stake in oil sands miner Syncrude Canada, is a prime takeover target and its most likely suitor is Imperial Oil (IMO +1.9%), the company with the second-largest stake, says FirstEnergy Capital analyst Michael Dunn.
- The analyst says his report is partly based on recent investor meetings with senior IMO execs who believe now is a good time to consider making acquisitions.
- Dunn thinks IMO would not want to pay more than a price in the low teens for COSWF, so its stock would have to fall further to make a bid attractive, and he suggests the company would not want to take on excessive debt - which could mean an equity-based offer, help from its controlling shareholder, Exxon Mobil (NYSE:XOM), or enrolling a current Syncrude partner such as Suncor (NYSE:SU).
Thu, Jan. 15, 2:56 PM
- Suncor Energy's (SU -1.6%) decision to cut $1B from its 2015 capital spending program actually came in below what some analysts expected, but continued weak oil prices would force some tough choices - including whether to reduce spending on its Fort Hills and/or Hebron projects, or take on more leverage to keep them moving.
- Desjardins Capital's Justin Bouchard notes that SU’s revised budget is based on oil at $59 but if oil was $50, he estimates SU would generate $4.8B in cash flow, meaning it would be $3.5B short in meeting its $6.5B capex and another $1.6B in dividends.
- But most analysts believe SU's move was prudent, since the company still has room to take on debt to fund existing projects or buy up any cheap assets that pop up given the industry’s weakness.
Wed, Jan. 7, 5:35 PM
Mon, Jan. 5, 12:18 PM
- Energy stocks severely underperform the broader market, with the sector -4.2% vs. the S&P 500's -1.4%, as U.S. oil prices briefly slip below $50/bbl for the first time since April 2009; Nymex crude recently was -4.4% at $50.37, while Brent crude -5.9% at $53.08.
- Among the day's biggest losers: DNR -9%, RIG -7.6%, NBR -4.8%, CHK -5.9%, SDRL -9.1%, SD -12.3%, NOV -5.9%, PSX -6.2%, APA -5.9%, DVN -4.4%, EOG -6%, SU -5.2%, OXY -4.2%, APC -8.7%, PWE -9%, ECA -5.5%, MRO -5.3%.
- Global oil majors, which have been seen as less vulnerable to falling oil prices, are posting big losses: XOM -2.7%, COP -4.5%, CVX -3.8%, BP -5.8%, RDS.A -4.6%, TOT -6.5%.
- ETFs: USO, XLE, OIL, UCO, ERX, VDE, OIH, SCO, XOP, ERY, FCG, DIG, PBW, BNO, GASL, DTO, DBO, DUG, IYE, XES, IEO, QCLN, IEZ, UWTI, PXE, USL, PXI, FENY, DWTI, PXJ, DNO, PSCE, RYE, SZO, PUW, FXN, OLO, DDG, HECO, TWTI, OLEM
Dec. 16, 2014, 11:44 AM
- Exxon Mobil (XOM +2.1%), Suncor Energy (SU +6.9%) and ConocoPhillips (COP +4.8%) combine to offer $559M for exploration rights in the deepwater Flemish Pass, the largest-ever bid for a license in Canada’s Newfoundland and Labrador province.
- The region is where Statoil last year announced the huge Bay du Nord find, which is estimated to contain up to 600M barrels of light, sweet crude.
Dec. 3, 2014, 11:32 AM
- The energy sector (XLE +1.5%) continues its momentum from yesterday, leading the way again as the best performing sector in early trading with crude oil rising 1.2% so far today and reports that U.S. well permits fell 40% last month.
- Top performers include Clayton Williams (CWEI +7.7%), Transocean Partners (RIGP +10.6%), Gaslog (GLOG +13.8%) and Energy XXI (EXXI +15.7%).
- Other leading energy names are showing stronger recoveries as they clear last Friday's bearish gap zone: XOM +0.2%, CVX +0.4%, COP +2.5%, OXY +2.5%, DVN +2.9%, EOG +2.5%, HES +2.2%, MUR +1.5%, NBL +2.3%, PXD +4.2%, SU +3%, CNQ +1.9%.
- Some analysts warn that the worst may not be over, however, as much of the advance is being driven by investors repurchasing ETFs they used to make short bets; investors also could opt to sell oil shares at a loss in coming weeks to reduce tax burdens.
Oct. 29, 2014, 11:28 AM
- Teck Resources' (TCK +2.4%) Q3 earnings tumbled 69% Y/Y, hurt by weak coal prices and a drop in copper production, but results beat analyst expectations, helped in part by improved results from its zinc operations.
- TCK's realized coal sales price in Q3 was US$110/metric ton vs. US$139 in the year-ago period, but unit cash costs in coal were just US$84, consistent with recent quarters, and says all six of its coal mines had positive cash margins.
- Q3 coal production rose 2% Y/Y; coal sales of 6.7M metric tons were the second highest on record for the period and follow record high sales for H1.
- Says construction of the Fort Hills oil sands project in Alberta, which it owns with Suncor (NYSE:SU) and Total (NYSE:TOT), is progressing according to plan and expects first oil as early as Q4 2017; TCK expects its share of Fort Hills' costs this year to total ~C$800M.
Jul. 31, 2014, 11:21 AM
- Suncor Energy (SU -2.3%) is sharply lower despite reporting Q2 earnings that rose 18% Y/Y but failed to meet analyst expectations.
- SU took a $718M writeoff to account for its share in the Joslyn oil sands project, which was mothballed by partner Total earlier this year, wrote down the value of its Libyan assets by $297M, and booked a $223M charge for oil sands assets that no longer fit into its future plans.
- SU cut its FY 2014 capital spending plan to C$6.8B from a previous target of C$7.8B in a bid to further reduce costs.
- Q2 production totaled 518.4K boe/day, up 3.6% Y/Y; output from Alberta operations rose 37% to 378.8K boe/day due to less maintenance in the quarter and increasing production from its Firebag thermal oil sands operations.
- Cash flow rose to $2.41B ($1.64/share) from $2.25B ($1.49/share).
Apr. 29, 2014, 8:32 AM
- Suncor Energy (SU) +1.5% premarket after reporting its Q1 earnings rose 36% Y/Y, which CEO Steve Williams calls the company's best-ever financial quarter.
- Results were helped by higher prices for North American crudes and a more profitable portfolio comprised of nearly 100% crude oil weighted production vs. 92% in the prior-year quarter.
- Total Q1 production fell 8.5% Y/Y to ~545K boe/day, which SU attributes to the sale of its natural gas assets and the shut-in of its Libya operations.
- Oil sands output rose 8.8% to ~389 bbl/day, but operating costs per barrel from those operations rose to C$35.60 from C$34.80 due to higher natural gas costs.
Apr. 25, 2014, 10:14 AM
- Canadian Oil Sands (COSWF -4.4%) announces an unplanned maintenance-related outage at Syncrude Coker 8-1, prompting it to lower its estimate for 2014 Syncrude production to 95M-105M barrels.
- National Bank downgrades shares to Underperform from Sector Perform, saying the outage could mean Q2 production will get hit especially hard since the timing could overlap with planned maintenance of another upgrader.
- Other owners of Syncrude include Imperial Oil (IMO), Suncor (SU), Murphy Oil (MUR), Sinopec (SNP) and Cnooc (CEO).
Apr. 21, 2014, 8:42 AM| 1 Comment
Aug. 16, 2013, 10:33 AM
- Warren Buffett’s new 17.7M-share stake in Suncor (SU +1.7%) could spark investor interest in the battered stocks of Canadian oil sands companies, analysts say.
- Canadian Natural Resources (CNQ), Cenovus Energy (CVE) and Imperial Oil (IMO) - with "scale and access to market and cost discipline" - may get a second look from investors as Wall Street reviews oil and gas plays beyond prolific shale plays in their own backyard.
- SU produced a record 390K bbl/day in July, and its "new normal" would see output shoot up to 420K, First Energy Capital says.
- SU is trading at some of the lowest cash flow multiples and, at 80 years, has one of the longest reserve lives in its peer group.
Aug. 15, 2013, 2:32 PM
- Warren Buffett's (BRK.A, BRK.B) new ~$524M stake in Suncor (SU +3%) is a declaration of support for controversial Canadian oil sands and could be the start of something bigger, perhaps plays in other Canadian oil sands projects, 24/7's Jon Ogg speculates.
- The SU purchase will help ensure a steady supply of oil for Buffett's BNSF railroad to move; oil accounts for ~4% of BNSF's freight and is expected to double during the next several years.
- SU doesn't have the same transportation issues as some other oil sands producers, a Morningstar analyst says; it has locked up more than enough pipeline and rail capacity to move its current and planed production for several years.
May. 1, 2013, 2:55 PMSuncor’s (SU -2.2%) 54% dividend hike not only topped expectations for a 30%-40% increase, it has the Street convinced more is coming. SU is the only major Canadian energy producer to generate free cash flow this year, which allows it to commit to competitive dividend increases, Canaccord notes; CIBC sees SU as a "free cash flow machine," producing $2.8B of FCF in 2012 with another $1B-$2B forecast for this year. | Comment!
Apr. 30, 2013, 8:39 AMMore on Suncor's (SU) Q1 results: Oil sands production averaged a record 357.8K bbl/day, up from 305.7K a year earlier, as its steam-driven Firebag project ramped up production. Total upstream production rose to 596.1K boe/day from 562.3K in the year-ago quarter. Raises its dividend 54% and plans to buy back up to C$2B of shares. Shares +3.1% premarket. | Comment!
Mar. 27, 2013, 5:49 PM
SU vs. ETF Alternatives
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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