Suncor Energy Inc. · TSX:SU
Suncor Energy — Investor Presentation (February 2016)
28 slides from Suncor Energy's investor presentation, February 2016
Slide 1: Suncor Investor Information
Suncor Investor Information Published February 2016 Cover photograph is Suncor’s #2 Upgrader at the Oil Sands base plant
Slide 2: Canada's leading integrated energy company
Canada’s leading integrated energy company Growing oil sands business with complementary upstream & downstream operations $63B enterprise value1 Dec 31, 2015 Fort Hills* Oil Sands 578 mboe/d 99% oil production St. John’s Firebag* Edmonton Montreal East 2015 Actuals MacKay Syncrude Calgary Sarnia Coa
Slide 3: Profitable growth with a significant reserves base
Profitable growth with a significant reserves base Low decline Production Outlook1 long-life reserves base 800 mb/d Pre-sanction 35 600 37 Offshore existing and in flight year Reserve Life Index4 as at December 31, 2014 400 Oil Sands existing and in flight 200 4.7 includes Major Oil Sands Maintenanc
Slide 4: An industry leader in cash generation
An industry leader in cash generation Free cash flow (US$/boe)1 Cash flow from $140 operations (US$/boe)1 Brent Oil Price (US$/bbl) $120 Rankings based on 23 Global Peers2 $100 $80 1 $60 1 1 3 1 2 3 1 4 5 2 $40 1 1 1 11 1 1 5 $20 4 1 1 3 2 3 1 5 7 12 1 1 $0 -$20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q
Slide 5: Financial resilience
Financial resilience Pre-funding major growth projects $11.0B Liquidity Cash and Living within our means Cash Equivalents ($4.0B) $1.45B $1.25B Balance sheet cash Growth Capital2 $6.80B $2.75B Fort Hills / Hebron Capital CFOPs1 Available Credit $2.60B Sustaining Capital Facilities ($7.0B)3 $4.0B Rem
Slide 6: Suncor value proposition
Suncor value proposition Capital Discipline • Rigorous capital allocation process • Competitive, sustainable, history of growing dividends • Opportunistic share buy backs Operational Excellence • Optimizing the base business • Disciplined cost management • Focus on safety, reliability and sustainabi
Slide 7: Returning cash to shareholders
Returning cash to shareholders 29¢ quarterly dividend per share (+4% in Q3 2015) Top quartile in global peer group2 Five year dividend growth (Q4 2010 - Q4 2015) 200% 190% >20% 5-year dividend CAGR1 2011-2015 100% 13 years consecutive dividend increases 0% -100% $5.3B shares repurchased 2011-2015 1.
Slide 8: Disciplined capital and operating cost management
Disciplined capital and operating cost management Suncor Oil Sands Capex & cash flow from operations1 Prices and cash operating costs1 C$ billions C$/bbl 100 Oil Sands Average3 CFOPs1 Sales Price 9.7 9.7 9.4 9.1 75 Capital Expenditures2 6.8 6.3 6.4 6.4 6.5 6.2 50 Cash Operating Costs1 per barrel 39.
Slide 9: Financial strength in a challenging economic environment
Financial strength in a challenging economic environment strong balance sheet Total debt to Net debt to CFOPs2 capitalization1 Under 2x Target 20%-25% Target ample liquidity 1.7x 24% 28% 0.9x 0.9x 1.7x conservative debt structure 2014 2015 2014 2015 3 A — low investment grade rating under review 4.0
Slide 10: Oil Sands production up to 600 mb/d before the end of the decade
Oil Sands production up to 600 mb/d before the end of the decade1 Debottlenecks, expansions and growth projects expected to raise total Oil Sands production from 463 mb/d (2015) up to 600mb/d. Firebag • 23 mb/d debottleneck completed in Q4 2015 • Capacity2: 203 mb/d bitumen Base Mine Extraction • Ex
Slide 11: Fort Hills development continuing to track key milestones
Fort Hills development continuing to track key milestones Illustrative annual cash flow profile for peak production of 91 mb/d1 50.8% Suncor working interest additional 10% working interest as at November 2015 91mb/d production capacity net to Suncor 96% engineering complete as at December 31, 2015
Slide 12: Firebag production exceeding expectations
Firebag production exceeding expectations Cost effective debottleneck supported 23 kbpd plant capacity expansion Scope 203mb/d Firebag plant capacity rerate • debottleneck of produced water cooling facilities • rerate of de-oiling and steam generation units <$5k/bbl debottleneck cost1 • reduced fiel
Slide 13: Technology innovation & development
Technology innovation & development • Investing ~$200 million per year in R&D1 • Targeting increased production and profitability while reducing environmental footprint Firebag Infill Wells – enabling capital and sustaining cost reductions Production and average SOR performance above expectations 4
Slide 14: Operational excellence metrics
Operational excellence metrics Improving environmental, safety and operational performance Environment Safety Reliability Reported environmental & Recordable injury incidents Upgrader reliability, based regulatory non-compliances per 200,000 work hours on 350 kbpd capacity 1.00 95% 200 0.80 90% 150
Slide 15: Long-term resilience in a future low-carbon Oil Sands economy
Long-term resilience in a future low-carbon Oil Sands economy Provincial climate framework Strong history of reducing Oil Sands GHG intensity1 0.19t/bbl >55% reduction in Oil Sands 100Mt emissions limit GHG intensity1 since 1990 Allows for continued production growth enabled by technology improvemen
Slide 16: Appendix
16 Appendix SuNcor )
Slide 17: 2016 Capital and production guidance
2016 Capital and production guidance1 2016 Capital2 Growth Capital3 Upstream Production4 $ millions Percent boe/d Upstream5 5,250 – 5,600 65% 400,000 – 425,000 Oil Sands Operations Downstream 700 – 800 5% 30,000 – 35,000 Syncrude6 Corporate 50 – 100 5% 95,000 – 105,000 E&P 420,000 – 440,000 Refinery
Slide 18: Refining & Marketing – optimizing the value of integration
Refining & Marketing – optimizing the value of integration Suncor Peers1 2015 prices and crude costs2 R&M Net Earnings1 High US$/bbl of capacity C$/bbl Average 15 Low Brent 10 103 72 49 58 5 - Oil Sands Inland Montreal R&M realization crude cost crude cost realization 0 2011 2012 2013 2014 2015 YTD
Slide 19: Market access strategy for inland oil production
Market access strategy for inland oil production Suncor has over 600 mb/d of near-term access to globally priced markets1 Upgrader Diesel Current1 Edmonton • Existing pipelines and hubs • 80+ mb/d rail loading and offloading Montreal • Suncor Refinery • Marine opportunities for inland oil • Line 9 t
Slide 20: High quality mining, in situ and upgrading oil sands portfolio
High quality mining, in situ and upgrading oil sands portfolio1 Base Plant Syncrude 350,000 b/d capacity Syncrude operated Suncor working interest 100% 42,000 b/d capacity (SU WI) 1,766 mmbbls 2P reserves Suncor working interest 12% 525 mmbbls 2P reserves (SU WI) Firebag Fort Hills 203,000 b/d capac
Slide 21: Offshore oil projects with ~470 million barrels of 2P reserves
Offshore oil projects with ~470 million barrels of 2P reserves1 Terra Nova Hibernia Suncor Energy operated ExxonMobil operated Suncor working interest 37.675% Suncor working interest 19.55%2 48 mmboe 2P reserves (SU WI) 104 mmboe 2P reserves (SU WI)3 White Rose Buzzard Husky Energy operated Nexen Pe
Slide 22: Canada's largest refining & marketing business
Canada’s largest refining & marketing business1 Edmonton Refinery Sarnia Refinery 142,000 b/d capacity 85,000 b/d capacity 100% oil sands feedstock ~75% oil sands feedstock Commerce City Refinery Montreal Refinery 98,000 b/d capacity 137,000 b/d capacity ~20% oil sands feedstock Rail offloading capa
Slide 23: Comparing typical attributes of North American oil plays
Comparing typical attributes of North American oil plays1 Tight Oil SAGD Mining Offshore Initial Capital Low Medium High High Reinvestment Cycle Short Medium Ultra long Medium Operating Costs Low Medium High Medium Production Light oil Bitumen Bitumen Light oil Reservoir Risk Medium Medium Low High
Slide 24: Suncor's proposed acquisition of Canadian Oil Sands Limited
Suncor’s proposed acquisition of Canadian Oil Sands Limited Fort Hills Firebag Syncrude Mackay Millennium River & Steepbank Voyageur Mine South Lewis Syncrude properties Suncor & other JV properties The Offer COS board supported offer of 0.28 SU shares per COS share. The transaction was valued at $6
Slide 25: Advisories
Advisories Forward-Looking Statements – This presentation contains by such forward-looking statements are reasonable, there can information to analyze business performance, leverage and certain “forward-looking statements” within the meaning of the be no assurance that such expectations will prove t
Slide 26: Slide Notes
Slide Notes Slide 2---------------------------------------------------------------- Chesapeake Energy Corporation, Chevron Corporation, Slide 9---------------------------------------------------------------- (1) Market capitalization + debt - cash and cash equivalents. Canadian Natural Resources Lim
Slide 27: Slide Notes (continued)
Slide Notes (continued) Slide 15 ----------------------------------------------------------------------- Slide 18 ------------------------------------------------------------------ Slide 21------------------------------------------------------------------- (1) Figures include both direct and indirec
Slide 28: Investor Relations Contacts
Investor Relations Contacts Steve Douglas David Burdziuk Leigh MacComb Samantha Enns Vice President IR Manager IR Analyst IR Associate IR 403 296 6622 403 296 6557 403 296 6639 403 296 9068 [email protected] [email protected] [email protected] [email protected] Visit us at the Investor Centre
Suncor Energy — Investor Presentation (February 2016) on 6ix