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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 Oct 06, 2023 8:27am
144 Views
Post# 35672692

RE:Implications of Fort Hills acquisition

RE:Implications of Fort Hills acquisitionAt the time of acquisition of Teck's share of Fort Hills, SU wrote down about 3.4 billion (if I recall correctly).

Frankly, I was surprised that they didn't do another writedown when they announced the deal with Total.  I would assume that their accountants are still doing the math and we will likely see it when they announce their 4Q results early next year.

The other thing that I find interesting is that if you look at their latest presentation from August, even with the additional oil production share from the Total acquisition, they are still short replacing the production from the Base Plant.  This means that SU is still in the hunt to find more oil production to replace the base Plant and the fact that they are even talking about it at all means IMO that they have pretty much acknowledged that they will not get environmental approval for an extension of the Base Plant.

No matter where they get the extra oil production it will cost them a lot of money to secure that source.  More importantly, as I have mentioned in previous posts, even if successful, all this does is keep current production levels the same and doesn't grow the company.  A company that is not growing is typically not a good long term core investment. Short term? Possibly.
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