Suncor Energy Inc. · TSX:SU
Suncor Energy — Investor Presentation (February 2011)
30 slides from Suncor Energy's investor presentation, February 2011
Slide 1: Delivering Shareholder Value
Delivering Shareholder Value February 2011 1
Slide 2: Legal notice
Legal notice This investor presentation contains certain forward-looking statements, including statements about Suncor’s growth strategy and expected future production, operating and financial results that are based on Suncor’s current expectations, estimates, projections and assumptions that were m
Slide 3: Legal notice
Legal notice Reserves and resources information is before royalty and as at December 31, 2009. The reserves and resource estimates included herein represent estimates only. There are numerous uncertainties inherent in estimating quantities and quality of these proved and probable reserves and contin
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 • Production from continuing operations > 90% crude oil in 2011 • An unparalleled oil sands resource base, recoverable using today’s technologies • Profitable, world class gr
Slide 5: Track record of excellence
Track record of excellence recognition for sustainability achievements and CSR reporting • A constituent of the Dow Jones Sustainability Index for 11 consecutive years • A member of the FTSE4Good Index since 2001 • Named to Maclean’s/Jantzi-Sustainalytics’ 2010 list of Top 50 Socially Responsible Co
Slide 6: Strategy
Strategy 1 Rick George President and Chief Executive Officer
Slide 7: One million barrels of oil production by 2020
One million barrels of oil production by 2020 superior targeted growth rate relative to peers Long term growth Medium term growth * Compound annual growth rate 7
Slide 8: Oil Production Mboe/d
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 Voyageur Upgr
Slide 9: Suncor / Total Strategic Oil Sands Partnership
Suncor / Total Strategic Oil Sands Partnership at a glance Joslyn mine 100 kbpd * B Fort Hills mine 164 kbpd ** A 36.75% WI – Total operated 40.8% WI – Suncor operated Firebag SAGD 200+ kbpd Mackay River SAGD 70+ kbpd 100% WI 100% WI Suncor Base Plant 350 kbpd 100% WI Voyageur Upgrader 200 kbpd 51%
Slide 10: Partnership adds upstream resource, de-risks Voyageur
Partnership adds upstream resource, de-risks Voyageur net cash flow benefit of $1.75 billion to Suncor A B Asset Swap Suncor swaps 19.2% of Fort Hills for 36.75% of Joslyn from Total Net to Suncor • Suncor is the operator of Fort Hills with 40.8% WI • Total is the operator of Joslyn with 38.25% WI +
Slide 11: Largest oil sands resource position in the Athabasca
Largest oil sands resource position in the Athabasca with a balance of mined vs in situ bitumen and integration Suncor In-Situ Suncor Mining Syncrude (12% WI) Fort Hills (40.8% WI) Joslyn (36.75% WI) 11
Slide 12: Focused strategy to deliver long term shareholder value
Focused strategy to deliver long term shareholder value low-cost cash flow from conventional assets funds long-life assets We produce natural gas as To provide greater reliability and flexibility to our A staged approach to increasing crude oil production capacity a natural price hedge feedstock sup
Slide 13: Sustainability strategy
Sustainability strategy supplying energy in a manner that meets the environmental, economic and social expectations of stakeholders Environmental performance • Oil sands developer of choice • Water management best practices – No increase in water supply from the Athabasca River for Voyageur Upgrader
Slide 14: Technology and innovation
Technology and innovation enhancing our triple-bottom line • Next generation tailings technology for new mine operations – Tailings Reduction Operations (TROTM) – dry tails returned to mine, enabling progressive reclamation at accelerated pace – Tailings thickeners – Minimizing tailings ponds/storag
Slide 15: 2011 Production outlook
2011 Production outlook > 90% crude oil production after targeted divestitures For the complete 2011 outlook please visit www.suncor.com/guidance 15
Slide 16: 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 Oil Sands 4,180 1,350 750 2,080 Firebag 3 405 - - 405 Firebag 4 875 - - 875 Fort Hills 100 - - 100 Voyageur Upgrader 260 - - 260 MacKay River
Slide 17: Merger exceeds expectations
Merger exceeds expectations building a strong foundation for the future Final operating synergies run rate of $800 million pre-tax • Expect full run rate impact on earnings in 2012 • Key initiatives include supply chain optimization, improved inventory management, and workforce/overhead rationalizat
Slide 18: Operations overview
Operations overview 2 Steve Williams Chief Operating Officer Rick George President and Chief Executive Officer
Slide 19: 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 20: Driving performance in In Situ operations
Driving performance in In Situ operations Firebag and MacKay River operating performance* * Prior to August 1, 2009 MacKay River operations were owned and operated by Petro-Canada 20
Slide 21: Oil Sands 2011 outlook summary
Oil Sands 2011 outlook summary * • Oil Sands production, 280 – 310 kbpd – Sales mix % (sweet/sour/bitumen), 47/49/4 – Realization on crude sales basket, WTI @ Cushing less C$7.00 – 8.00 – Cash operating cost (ex Syncrude), $39 – 43/bbl • ~ $2.50/bbl associated with the 6-week, full unit shutdown of
Slide 22: Driving profitability in Natural Gas portfolio
Driving profitability in Natural Gas portfolio through high-grading assets and shift to unconventional • Strategic focus to improve profitability as measured by ROCE • High-grading portfolio – Sell assets that do not meet return criteria, regardless of volume impact – Shift capital to most profitabl
Slide 23: Refining & Marketing
Refining & Marketing forecasted to generate > $1 billion 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 Urban Share of Mar
Slide 24: Opportunity rich International & Offshore portfolio
Opportunity rich International & Offshore portfolio low cost cash flow to fund oil sands growth • Provides substantial, low-cost cash flow • Lowers average operating cost per barrel of total upstream production • Attractive near field add-ons and greenfield opportunities • Modest production growth o
Slide 25: Maintenance schedule
Maintenance schedule SU Operated Assets * Start Date Duration Planned Non-Operated Assets * Start Date Duration Impact ** 2011 U2 turnaround May 6 wks 215 kbpd White Rose July 3 wks Terra Nova – dockside maintenance July 15 wks 25 kbpd Buzzard August 1 wk * Scope and duration of turnarounds may chan
Slide 26: Financial outlook
Financial outlook 3 Bart Demosky Chief Financial Officer
Slide 27: Financial objectives
Financial objectives disciplined and focused strategy to deliver shareholder value 1. Focus on driving shareholder value – Targeted sale of non-core assets – Drive efficiencies across the organization to lower costs – Target ROCE of 15% on new capital – Reactivation of projects in safe mode 2. Maint
Slide 28: Financial strength to deliver
Financial strength to deliver improving key financial metrics • Target to fund medium-term capital spend largely from internally generated cash flows at $85 WTI – expect 2012 to 2015 capital expenditure to range between $8.0-9.5B • Significant free cash flow generation from 2014+ * MPIP – major proj
Slide 29: Solid financing in place to fund operations and grow
Solid financing in place to fund operations and grow $6.3B of available liquidity 29
Slide 30: 2011 capex and cash flow outlook
2011 capex and cash flow outlook • 2011 capital program to be funded entirely through internally generated cash flow, proceeds from Total Partnership and other potential asset divestitures • Both International & Offshore and Refining & Marketing divisions generate significant free cash flow to fund
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