Suncor's proportionate share of production from the Syncrude joint arrangement contributed an average of 31,200 bbls/d of production during the first quarter of 2013, compared to 35,400 bbls/d in the same quarter of 2012. Syncrude operated at lower rates for the quarter, due primarily to planned and unplanned maintenance in upgrading and mining. Operational issues were resolved by the end of the quarter.
The Exploration and Production segment contributed 207,100 boe/d of production in the first quarter of 2013, compared to 221,200 boe/d in the same period of 2012. The decrease in production was due primarily to ongoing maintenance of Terra Nova subsea infrastructure during the quarter and production declines in North America Onshore. Flow line issues at Terra Nova that arose after the 2012 dockside maintenance program were remediated in the first quarter of 2013. Terra Nova exited the quarter producing from all three drill centres following the remediation work, which was originally planned for the third quarter of 2013.
Operational performance in the Refining and Marketing segment continued to be strong, contributing to total refinery utilization of 96% in the first quarter of 2013, compared to 92% in the first quarter of 2012. Total refinery crude throughput averaged 443,000 bbls/d during the first quarter of 2013, compared to 419,800 bbls/d in the first quarter of 2012.
Suncor's energy marketing and trading division continued to optimize margins realized on both proprietary and purchased volumes by using midstream logistics and infrastructure to buy or sell crude in more favourable markets, resulting in operating earnings of $78 million recorded in the Corporate, Energy Trading and Eliminations segment in the first quarter of 2013.
Capital discipline is a key enabler of Suncor's strategy. The company allocates its capital according to a clear set of priorities. It is committed to ensuring sustainable and reliable operations, investing in profitable growth and delivering strong returns to shareholders through dividends and share repurchases. Suncor continued to return cash to shareholders through dividends per common share of $0.13 and share repurchases of $405 million in the first quarter of 2013.
Aligned with the company's strategic objectives and the strength of its business model to deliver consistent and improving financial results, subsequent to the quarter, Suncor's Board of Directors approved a 54% increase to the company's quarterly dividend to $0.20 per common share beginning in the second quarter of 2013. The company also received regulatory approval to purchase for cancellation up to an additional $2 billion worth of its common shares, commencing May 2, 2013 and ending September 19, 2013.
Investing in Integration
Suncor's integrated model has enabled the company to capture Brent-based pricing on the majority of its Oil Sands production through its refining operations. As Suncor's upstream production continues to grow, enhancing integration within the company's operations remains vital to maximizing profitability on this growth. The company's capital investment plans for 2013 include projects to prepare the Montreal refinery for the receipt and processing of inland crudes. Construction to enable rail receipt of inland crudes to the Montreal refinery began in the first quarter of 2013 and is expected to be completed in the fourth quarter of 2013.
Oil Sands Operations
Most Popular Stories
- Adam Levine Wins Big as 'The Voice' Crowns Champ
- 'Beyonce' Tops the U.S. Album Chart
- Archer Daniels Midland Moving HQ to Chicago
- Target Security Breach May Affect 40 Million Cardholders
- Tyson Foods Charged With Civil Rights Violation
- Bernanke Lets Congress Have It in Final Press Conference
- Wall Street Falls a Day After Surge
- Existing Home Sales Drop for 3rd Month
- Demi Lovato Leaving 'X Factor' to Return to Music
- Jobless Claims Climb by 10,000 in Week