(Adds details of production, background, comment from company
By Ethan Lou
CALGARY, Alberta Dec 15 Canadian Natural
Resources Ltd said on Thursday that it expected
2017 production to rise by 6 percent and set its capital budget
for next year at C$3.89 billion ($2.92 billion), a slight
increase from C$3.84 million in 2016.
Canada's largest independent petroleum producer said overall
production in 2017 is expected to be between 833,000 barrels of
oil equivalent per day (boe/d) and 883,000 boe/d, from 808,000
boe/d in 2016.
Producers have been increasing their capital budgets and
projected output for 2017 as oil prices recover from the crash
of the past two years.
Last month, Canadian Natural became the first oil sands
producer to re-sanction a deferred major project, its
40,000-barrel-per-day Kirby North thermal expansion, a positive
sign for the battered industry.
But company executives also said in a conference call the
budget for 2017 may change depending on commodity prices, and
that they are prepared to roll back the figure by up to C$900
"We're fortunate that we have a lot of capital flexibility,"
President Steve Laut said later in an interview. "If the past is
any prediction of the future, there will be volatility."
Canadian Natural said it would complete an expansion of its
Horizon oil sands project located north of Fort McMurray in
Alberta, in 2017, and the project's third phase would be on
stream in the fourth quarter.
The oil producer forecast synthetic crude oil production
from the Horizon project of 170,000 barrels per day (bbl/d) to
184,000 bbl/d for 2017, which is an increase from 2016 of 44
Canadian Natural will spend C$1.7 billion on Horizon, down
from C$2.7 billion this year, but will dole out C$1.79 billion
on exploration and production projects, an increase of nearly
half a billion dollars, the company said.
The company's shares were down 0.4 percent at C$44.60 in
midday trading on the Toronto Stock Exchange, in line with a
broad drop in the energy sector as a whole.
Canadian Natural said on Monday it will sell its stake in
the Cold Lake pipeline to Inter Pipeline Ltd for
C$527.5 million in cash and stock, but will maintain access to
the route to move its crude.
($1 = 1.3322 Canadian dollars)
(Reporting by Ethan Lou in Calgary, Alberta, and Komal Khettry
in Bengaluru; Editing by Martina D'Couto and Alan Crosby)