Calgary-based energy giant Canadian Natural Resources Ltd. reported on Thursday that it suffered a net loss of $776 million in the fourth quarter of 2018 “due to a significant decline in crude oil pricing, largely driven by an oversupplied domestic market environment, lack of takeaway capacity and increased global supply.”
That compared to net earnings of $396 million for the year before.
For the year, Canadian Natural reported net earnings of $2.6 billion in 2018, an increase of $194 million over 2017 levels.
“We had a strong operational year in 2018 despite the volatility in commodity prices, as the company was able to react quickly and strategically to changing market conditions,” said Canadian Natural president Tim McKay.
He said the company achieved record annual production of about 1,079,000 barrels of oil equivalent per day, delivering 12 per cent production growth and 14 per cent production per share growth over 2017 levels. Its oil sands mining and upgrading operations delivered record annual production of 426,190 barrels per day of synthetic crude oil as a result of strong production at Horizon and a full year of production from the Athabasca Oil Sands Project.
“In 2018, crude oil price differentials widened due to market access restrictions and as a result, the company made the proactive and strategic decisions throughout the year to voluntarily curtail crude oil production and reduce activity. Canadian Natural strongly supports the government of Alberta’s mandatory production curtailment program announced in late 2018 and as expected after this announcement, crude oil price differentials have since significantly narrowed,” it said.
“The Western Canadian Select differential index has narrowed to US$12.38/bbl for Q1/19 from the US$39.36/bbl experienced in Q4/18 and the differential between SCO and West Texas Intermediate benchmark pricing has narrowed to US$2.70/bbl for Q1/19 from the US$21.35/bbl experienced in Q4/18. As previously announced, the company will continue to evaluate progress on export pipelines before enacting increases, if any, to its base 2019 capital budget.”
– Mario Toneguzzi for Calgary’s Business