Suncor Energy Inc. (TSX:SU) says production is expected to increase next year, but the company plans to reduce its capital spending.
The energy company says average production for 2017 is expected to be between 680,000 to 720,000 barrels of oil equivalent per day. Capital spending is budgeted for between $4.8 billion and $5.2 billion.
“We continue to focus on delivering on our commitments and making decisions that demonstrate capital discipline, while reflecting our long-term vision for the company,” said Steve Williams, president and chief executive officer. “Through our 2017 capital spending program, we’ve earmarked the capital required to bring two major growth projects, Fort Hills and Hebron, to completion while at the same time investing in our existing assets to ensure continued safe, reliable and efficient operations. We will maintain the unwavering focus on cost management, which has helped us to generate strong cash flow throughout these past two years of low oil prices.”
Suncor says the midpoints of these ranges represent a year-over-year increase to production of more than 13 per cent and a reduction to capital spending of approximately $1 billion.
Approximately 40 per cent of the 2017 capital spending plan will be spent on upstream growth projects, including Fort Hills and Hebron.
The remaining 60 per cent will go toward sustaining capital in the upstream, downstream and corporate segments.
-With files from Jenna Hamilton