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By Charles Kennedy – Aug 15, 2023, 2:30 AM CDT

Suncor Energy has become the latest oil major to report a substantial decline in profits from last year’s record performance.

The Canadian heavyweight booked earnings of C$1.88 billion for April to June this year, or about $1.4 billion, which was down from C$4 billion, or $2.97 billion, for the second quarter of 2022.

The company also reported it had returned more than $1 billion to shareholders during the reporting period, in the form of share buybacks and dividends.

Suncor also booked higher production for the quarter, with total oil sands output at 814,300 barrels daily, up from 760,700 bpd a year earlier.

The trend is visible across the industry. As oil prices fell from their 2022 peaks, the industry’s profits fell with them. Production, however, has been higher for many in oil and gas, as demand remains robust.

“Our In Situ assets and upgraders delivered strong performance once again and helped reduce the impacts of planned maintenance at our integrated operations in the Fort McMurray region,” Suncor’s chief executive, Rich Kruger, said.

“During the second quarter, we generated $2.7 billion of adjusted funds from operations and delivered $1.4 billion to shareholders, and we’re making good progress on our goal of clarifying, simplifying and focusing the organization to drive improved performance and maximize value for our shareholders.”

Shareholders remain a top priority for the North American oil patch despite lower profits. As part of that maximization of value for shareholders, Suncor booked a restructuring charge in its second-quarter report, related to planned layoffs.

Despite lower oil prices, compared to last year’s, Alberta, Canada’s oil heartland, expects to book another budget surplus this fiscal year.

According to the province’s Finance Ministry, Alberta’s total revenues this fiscal year will top C$70 billion, or over $51 billion. However, this will be a decline of close to $4 billion on revenues projected for the previous fiscal year because of lower oil prices and the looming global recession. However, revenue will rise over the next two fiscal years.

By Charles Kennedy for Oilprice.com

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Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

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