Suncor Trims Top End of Production Forecast on Syncrude Shutdown

Suncor Energy Inc., Canada’s largest oil producer by market value, dropped the top end of its production target for the year as it works to bring its key Syncrude facility back online after a power outage brought the plant down last month.

Output this year will be 740,000 to 750,000 barrels of oil equivalent a day, the Calgary-based company said Wednesday. Suncor was forecasting production of 740,000 to 780,000 barrels as of May 1.

Suncor has been grappling with the Syncrude outage since late June, when a transformer trip knocked out power to the 350,000-barrel-a-day plant, one of the biggest of its kind in the world. The company returned part of the facility to service this month, and says a second section will be back online in August, with the plant returning to full capacity by mid-September.

“We want to reiterate our belief in Syncrude’s long‑term potential and ability to achieve sustained reliability improvements, despite our disappointment with recent operational performance,” Chief Executive Officer Steve Williams said in a statement. “From experience, we know that long‑term reliability is a journey and we are working with the owners to advance strategic initiatives in order to achieve our reliability and cost goals.”

Facility Output

Output from the facility will be about 60 percent to 70 percent of capacity for August, Suncor has said.

The most recent outage is just the latest mishap at Canada’s second-oldest oil-sands mine, which started operation in the mid-1970s and has faced reliability issues in recent years. The plant in May underwent scheduled maintenance that took longer than expected.

Suncor owns about 59 percent of Syncrude, and Imperial Oil Ltd. owns 25 percent. The remainder of the operation is owned by China Petroleum & Chemical Corp. and CNOOC Ltd.’s Nexen.

The Syncrude shutdown threatens to put a damper on what was supposed to be a year of large production gains for Suncor, which is ramping up output at its Fort Hills oil-sands mine and the Hebron offshore project. The company’s most recent forecast for production would have represented an increase of as much as a 13 percent increase from last year’s output of 685,300 barrels a day.

The outage also halted a rally in Suncor shares. The stock was up 16 percent this year before the incident, but is down 0.5 percent since then.