-- Kirby South Phase 1, the Company's first large scale steam assisted gravity drainage ("SAGD") project, is targeted for first steam in Q4/13 and is targeted to add 40,000 bbl/d of production in late 2014. Construction is progressing slightly ahead of schedule and on budget.
- Horizon SCO production volumes averaged approximately 86,000 bbl/d in 2012. The Company continues its enhanced focus on operational discipline and safe, steady and reliable operations at Horizon. Reliability of the Horizon plant continues to steadily improve and annual SCO production is targeted to range from 100,000 bbl/d to 108,000 bbl/d in 2013, which includes the impact of the planned May 2013 turnaround.
-- The addition of the third ore preparation plant ("OPP") and associated hydro-transport unit was integrated into the Company's mining operations in early 2012. The equipment has substantially increased the overall reliability at Horizon.
-- In January and February 2013, strong performance from Horizon resulted in average SCO volumes of approximately 113,000 bbl/d and 107,000 bbl/d, respectively. Q1/13 production guidance is targeted to range from 105,000 bbl/d to 111,000 bbl/d of SCO.
-- Canadian Natural maintains a flexible schedule for Horizon expansion construction to ensure capital efficiencies. The staged expansion to 250,000 bbl/d of SCO production capacity at Horizon continues to be broken down into smaller more focused projects which has kept projects currently under construction trending at or below cost estimates. In 2012, long life, low decline SCO Company Gross proved reserves increased 6% to 2.26 billion barrels. SCO Company Gross proved plus probable reserves remained essentially unchanged at 3.35 billion barrels.
- During Q4/12, the Redwater Partnership 50,000 bbl/d bitumen refinery (78,000 bbl/d of bitumen blend) was sanctioned by its owners (50% Canadian Natural). The Company will provide 12,500 bbl/d of bitumen feedstock to the refinery as a toll payer. Work continues on the Redwater project and completion is targeted for mid-2016.
- During 2012, Canadian Natural purchased 11,012,700 common shares for cancellation at a weighted average price of $28.91 per common share.
- For 2013, the Board has approved a 19% dividend increase to C$0.125 per quarter, C$0.50 per share annualized. This will be the thirteenth consecutive year that the Company has announced an increased annual dividend distribution representing a compound annual growth rate of 21% over the period.
- In addition, the Company's Board of Directors have directed Management to continue with an active program, subject to market conditions, to purchase for cancellation common shares under the Company's Normal Course Issuer Bid at or above the levels of shares purchased in financial year 2012.
OPERATIONS REVIEW AND CAPITAL ALLOCATION
In order to facilitate efficient operations, Canadian Natural focuses its activities in core regions where it can own a substantial land base and associated infrastructure. Land inventories are maintained to enable continuous exploitation of play types and geological trends, greatly reducing overall exploration risk. By owning and operating associated infrastructure, the Company is able to maximize utilization of its production facilities, thereby increasing control over production costs. Further, the Company maintains large project inventories and production diversification among each of the commodities it produces; light and medium crude oil, primary heavy crude oil, Pelican Lake heavy crude oil, bitumen and SCO (herein collectively referred to as "crude oil"), natural gas and NGLs. A large diversified project portfolio enables the effective allocation of capital to higher return opportunities.
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