Suncor to boost 2016 spending by up to $900M

Oil sands producer aims to spend between $6.7 billion and $7.3 billion next year.

CALGARY — Suncor Energy has set a capital budget for 2016 that’s $900 million higher than what it expects to spend this year.

That’s despite the company’s gloomy outlook for commodity prices next year: US benchmark crude unchanged at US$50 a barrel and a Canadian heavy oil price that’s $2 lower than this year’s forecast.

Canada’s dominant oil sands producer aims to spend between $6.7 billion and $7.3 billion next year – a range it says offers the flexibility to respond to changing market conditions.

In October, Suncor said it was on track to finish 2015 with capital expenditures of between $5.8 billion and $6.4 billion.

Company-wide output next year is expected come in at between 525,000 and 565,000 barrels a day.

It’s lower than this year’s projected range of between 550,000 and 595,000 barrels a day because of planned maintenance that’s to take place at some oil sands projects.

Cash costs in the oil sands are seen dropping by a dollar a barrel to between $27 and $30.

In October, Suncor launched an all-stock hostile takeover bid for Canadian Oil Sands Ltd. worth about $6.9 billion when the target company’s debt is taken in to account.

© 2015 The Canadian Press

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