Engineering & Mining Journal

JUL 2019

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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Page 24 of 67

OIL SANDS JULY 2019 • E&MJ 23 "Our expenditures on Frontier are lim- ited to supporting this process," the com- pany said in its report. "We continue to evaluate the future project schedule and development options as part of our ongoing capital review and prioritization process. CNRL Rebuilds Scotford Canadian Natural Resources (CNRL) is also a supporter of the mandatory produc- tion curtailments. The company voluntari- ly curtailed its heavy crude oil production in the fourth quarter of 2018 by 9,600 bbl/d, and its first-quarter 2019 results saw production decrease a further 14% to 68,473 bbl/d. In total, CNRL's oil sands operations produced 416,206 bbl/d of synthetic crude oil (SCO) in the first quarter, a decrease of 7% from 2018 Q4 levels thanks to the curtailment and increased maintenance activity. However, as a result of market ad- justment, the company's net earnings were up significantly at around C$1 billion. Commenting on the company's first-quarter 2019 results, Steve Laut, executive vice chairman, stated: "The company demonstrated the resilience and strength of its long-life, low-decline and low-capital exposure assets, generating significant adjusted funds flow of approx- imately C$2.2 billion. "The company was able to achieve ad- justed funds flow that exceeded net cap - ital expenditures by approximately C$1.3 billion, largely due to a strong operation- al quarter and improvement in crude oil differentials, driven by the government of Alberta's mandatory production cur- tailments, which is strongly supported by Canadian Natural." CNRL President Tim McKay added: "Operations were strong in the first quarter as our large, balanced and diverse asset base allowed the company to strategically manage through the mandatory production curtailments to maximize value. Produc- tion was as expected in Q1/19, reaching approximately 1,035,000 barrels of oil equivalent per day (BOE/d), consisting of 54% light crude oil, NGLs and SCO, 22% heavy crude oil and 24% natural gas." CNRL faced another challenge during April in the form of a fire at the Scotford upgrader in which it has a 70% interest. The fire was contained to a process fur- nace in the North Upgrader, while oper- ations at the South Upgrader plant were not impacted. The planned 38-day repair program was forecast to cost C$15 million, and CNRL optimized its other Albertan assets to mit- igate the financial impact. Work began on April 14, and until the program was com- plete, the South Upgrader ran at a restrict- ed net processing rate of 140,000 bbl/d of SCO. The maintenance finished in June and CNRL said May and June net production at its Albian mines averaged 171,500 bbl/d, rather than the planned 178,500 bbl/d. Kirby North: On Budget and Ahead of Schedule CNRL has also been busy at its Primrose and Kirby in-situ facilities. Work to install additional pads at Primrose is on budget and ahead of schedule with initial produc- Don't let downtime cost you. Choose GIW's RAMSL technology to extend your pump's wear life with just the push of a button. NO TIME IS A GOOD TIME FOR DOWNTIME. Learn more at

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