Suncor Energy Inc. · TSX:SU
Suncor Energy — Investor Presentation (May 2011)
25 slides from Suncor Energy's investor presentation, May 2011
Slide 1: Growth + Integration = Value Creation
Growth + Integration = Value Creation Investor Information May 2011 1 1
Slide 2: Legal notice
Legal notice This investor presentation contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation (collectively, “forward-lo
Slide 3: Legal notice
Legal notice Reserves and contingent resource information presented herein is presented as Suncor’s working interest (operating and non-operating) before deduction of royalties, and without including any royalty interests of Suncor, and is at December 31, 2010. For more information on Suncor’s reser
Slide 4: Canada's premier integrated energy company
Canada’s premier integrated energy company with an unparalleled resource base and growth opportunities What differentiates us Best Estimate Contingent Resources • Production from continuing operations Conventional 3 > 90% crude oil in 2011 Mining 6 • An unparalleled oil sands resource base, In Situ
Slide 5: Diversified asset base
Diversified asset base to support our integrated strategy and fund growth 5
Slide 6: Largest resource position of any single company in the Athabasca
Largest resource position of any single company in the Athabasca with a balance of mined vs in situ bitumen Suncor In Situ Suncor Mining Syncrude (12% WI) Fort Hills (40.8% WI) Joslyn (36.75% WI) 6
Slide 7: Integrated model to deliver long term shareholder value
Integrated model to deliver long term shareholder value low-cost cash flow from conventional assets funds long-life assets To provide greater reliability and flexibility to our We produce natural gas as feedstock supplies, we produce bitumen through mining A staged approach to increasing crude oil p
Slide 8: Targeting one million boe/d production by 2020
Targeting one million boe/d production by 2020 superior growth rate relative to peers Long term growth Medium term growth Oil Sands CAGR* 10% Exploration and Production CAGR* 4%† Source: Credit Suisse estimates excluding Suncor. Suncor represents current growth plan Dec 8th 2010 estimates *Compound
Slide 9: Projected corporate growth of 8% to 2020
Projected corporate growth of 8% to 2020 Oil Sands growth of 10% underpinned by Suncor / Total Partnership 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Planned Net Target Oil Sands Capacity kbpd First Oil Firebag 3 62.5 2011 Firebag 4 62.5 2013 Fort Hills ** 67 2016 Suncor/Total Partnership Voy
Slide 10: Sustainability underpins our growth
Sustainability underpins our growth environmental goals for 2011 and beyond Water use By 2015, we are targeting to *: • More than 90% of water recycled at in situ operation • Reduce total water intake by 12% • Reduced absolute water use by more than 1/3 since 2002 • Increase land area reclaimed by 1
Slide 11: Track record of excellence
Track record of excellence recognition for sustainability achievements and CSR reporting • A constituent of the Dow Jones Sustainability Index for 12 consecutive years • A member of the FTSE4Good Index since 2001 • Winner of the President’s Award in the Canadian Association of Petroleum Producer’s 2
Slide 12: Technology and innovation
Technology and innovation supporting our drive to operational excellence • Next generation tailings technology for new mine operations – Tailings Reduction Operations (TROTM) - dry tails returned to mine, enabling progressive reclamation at accelerated pace – Minimizing tailings ponds/storage footpr
Slide 13: 2011 Production outlook
2011 Production outlook > 90% crude oil production after targeted divestitures 520,000 – 570,000 For the complete 2011 outlook please visit www.suncor.com/guidance 13
Slide 14: 2011 Capital expenditure outlook
2011 Capital expenditure outlook $6.7 billion in capital expenditure > 40% growth weighted 2011 Outlook Maintenance Capital Growth Capital Base Non – Recurring $ millions $ millions $ millions $ millions Oil Sands 4,300 1,350 750 2,200 Oil Sands Base 1,940 800 725 415 In Situ 1,750 300 25 1,425 Oil
Slide 15: Operations reliability through continuous improvement
Operations reliability through continuous improvement ensure operational integrity and enhance operational performance Relentless pursuit of the basics • Implement Operational Excellence Management System, including Process Safety Management • Increase workforce competency and stability • Improve ma
Slide 16: Driving performance in In Situ operations
Driving performance in In Situ operations Firebag and MacKay River operating performance* In Situ growth led by Firebag and MacKay River • End of decade bitumen portfolio 40% in situ weighted • Target long term steam oil ratios in the mid / low 2’s – current MacKay river SOR’s at the low end of indu
Slide 17: Oil Sands 2011 outlook and turnaround summary
Oil Sands 2011 outlook and turnaround summary (1) Oil Sands production, 280 – 310 kbpd / Syncrude production 35-37 kbpd Sales mix % (diesel/sweet/sour/bitumen), 8/33/55/4 Realization on crude sales basket, WTI @ Cushing less C$5.50 – 6.50 Cash operating cost (ex Syncrude), $39 – 43/bbl • ~ $2.50/bbl
Slide 18: Established Exploration & Production platform
Established Exploration & Production platform free cash flow to fund Suncor’s growth Combined former International & Offshore and Natural Gas into one segment to leverage our expertise in exploration, engineering and geo- sciences to more effectively deliver conventional oil and gas operations • Fle
Slide 19: Driving profitability in Exploration & Production
Driving profitability in Exploration & Production high-grading assets and investing in oil opportunities Opportunities in 2011 • Focus on advancing development projects for sanction in 2011: – Hebron (East Coast) – Golden Eagle (UKCS) • Awarded three new licenses and two extensions in Norway (four o
Slide 20: Refining & Marketing
Refining & Marketing forecasted to generate > $1 billion free cash flow in 2011 Refining • 443,000 bpd of refining capacity, roughly half of which is capable of handling oil sands feeds • Higher than average complexity • Current and future potential oil sands integration Marketing • #1 Branded retai
Slide 21: Refining & Marketing priorities
Refining & Marketing priorities building on merger integration synergies captured in 2010 Accelerate operational excellence to deliver disproportionate value from our assets • Maintain reliable refinery operations to enable leveraging of strong margins • Focus on Personal and Process Safety Manageme
Slide 22: Financial objectives
Financial objectives disciplined and focused strategy to deliver shareholder value 1. Shareholder value creation – Targeted sale of non-core natural gas assets – Drive efficiencies across the organization to lower costs – Target ROCE of 15% on new capital 2. Strong balance sheet – Maintain net debt/
Slide 23: Financial strength to deliver
Financial strength to deliver improving key financial metrics • Strong post-merger cash flow has Q1/10 Q4/10 Q1/11 enabled steady reduction to net debt Net debt / cash flow 4.3x 1.7x 0.9x • 2011 $6.7B capital program internally from operations funded Total debt / capitalization 30% 26% 23% • Target
Slide 24: Solid financing in place to fund operations and growth
Solid financing in place to fund operations and growth $10B of available liquidity $ billions, as of March 31, 2011 Revolving bank lines with 2013 maturity 7.5 Demand facilities 0.5 Total credit facilities 8.0 Available credit facilities 6.5 Cash on hand 3.5 Total liquidity 10.0 24
Slide 25: Delivering value to shareholders
Delivering value to shareholders 23% rate of return compounded annually since IPO $8,000 Return on investment $7,000 Based on $100 invested in SU March 18, 1992 assuming reinvestment of dividends $6,000 $5,173.53 $5,000 $4,000 $3,000 $2,000 $1,000 $0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001