RE: How could their losses double? Declining production (42% below design capacity) , Bitumen prices and unsustainable debt load are the simple answer to your question.
As I telegraphed on this board at the and of June Q2 bitumen prices were below $38/bbl (average Q2 (34/bbl) which is ~$18/bbl below their Total Cost including big brake on the Royalties.
When they go to Post-Payout Royalties (2013/14) they will need ~$64 bitumen prices (~$110WTI) to brake even. Q3 is not going to be much better as July and 1/2 Aug bitumen prices did not improved much.
As an investor in the CLL you have to ask yourself the question: why would I buy money loosing and 2nd worst performing SAGD in Alberta loaded with $900 debt which will require additional $700 million to expend the production to the point of financial sustainability?
Are there better opportunity out there (in light oil) to invest $1.6 to $1.8 billion with much better and more predictable rate of the return on your capital?
PS: refinery initial purchase cost was $55 million. Between 2008 and 2012 CLL added $70.4 million in capital expenditures to upgrade the MRC refinery for the total cost of $125. They sold it for $120 millions + inventory.