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Suncor Energy Inc. T.SU

Alternate Symbol(s):  SU

Suncor Energy Inc. is a Canada-based integrated energy company. The Company's segments include Oil Sands, Exploration and Production (E&P), and Refining and Marketing. Its operations include oil sands development, production and upgrading, offshore oil and gas production, petroleum refining in Canada and the United States and its Petro-Canada retail and wholesale distribution networks, including Canada’s Electric Highway, a coast-to-coast network of fast-charging electric vehicles (EV) stations. Petro-Canada has a network of over 1,800 retail and wholesale locations across Canada, providing customers with a wide variety of fuel and service offerings including low-carbon fuel options. It is developing petroleum resources while advancing the transition to a low-emissions future through investment in power and renewable fuels. It also wholly owns the Fort Hills Project, which is located in Alberta's Athabasca region, approximately 90 kilometers north of Fort McMurray.


TSX:SU - Post by User

Comment by Experiencedon Aug 01, 2023 6:30am
124 Views
Post# 35566303

RE:RE:Something to Think About

RE:RE:Something to Think AboutMigraine..... a few points 

Right now there are three issues facing a reluctance of people to buy EVs

1,,,,,,the initial cost relative to an ICE

2.....range anxiety

3,,,,time to recharge

Range anxiety only relates to longer road trips.  Current technology is already sufficient for local use.  So for example there is no need for 800kv for homes so your point there is not relevant.  I can charge my EV overnight using a 220 volt household line and a 40 amp breaker. For road trips, the Toyota solid state battery will actually double the range of a current ICE car and that will be available starting in the 2025 to 2027 model year. Solid state batteries will recharge in 4 minutes according to Toyota as well as the long range.

Tesla already has a new battery 4x as powerful as the current ones.  This will mean less batteries needed for the current range and will result in lower costs for EVs changing the math big time.  These new batteries will likely be available starting new year, Tesla will be selling a $25k EV in the next year or 2.

The 800kv charging stations are gravy and will be  available where practical....cars like the Ioniq5 already have the technology to use this high voltage charging.

Bottom line is that there is a lot of new technology coming for EVs over the next few years that will address the current issues I identified above.  When you combine that with Government legislation, oil use in NA Europe China and India in the transportation sector will steadily decline (and rapidly) over the next 10 years. Oil use in petrochemicals is another story.

As I have repeated said, as an investor, more money is made buying shares in growth industries as opposed to those facing declining markets. The valuation metrics of SU reflect that my opinion is also shared by the pros on the The Street.  Frankly, we are at an inflection point just like what happened in the 1970s with the digital switch by Nortel and the microprocessor by Intel.  I made a ton of money back then recognizing where the future was going.  Those that didn't actually lost money thinking that change wasn't going happen.  We are at a similar history right now. I for one expect to do the same again.

In the specific case of SU, the company will be challenged to keep production flat let alone grow production.  Pipeline capacity is essentially fixed and so even if what you say about the Permian actually happens, SU won't be able to ship more oil to US if it turns out that production falls more than oil demand.  So this means that the sole driver for an increase in the SP will be the price of oil and as discussed before we have a difference of opinion on how that will turn out. This is particularly meaningful since SU management has doubled down on oil and essentially has no Plan B.
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