OPEC OIl exports hit 29 mln bbl last week

OPEC OIl exports hit 29 mln bbl last week This is incredible: OPEC crude oil weekly exports reached a record last week, led by SaudiArabia with loadings of 8.4mn bpd 



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Saudi Arabia faces the prospect of much deeper -- and financially painful -- oil production cuts after Iraq joined the queue of group members seeking immunity from the deal hatched in Algiers.

In addition to Iraq, the second-biggest exporter in the group, Iran has already sought to exclude itself. Output is also recovering from fields in Nigeria and Libya, two more countries that were exempted from the Algiers deal because violence has wrought havoc in their oil industries. Taken together, more than a third of OPEC’s production now stands outside the plan.

Iraq’s plea to be left out prompted Olivier Jakob, a consultant at Petromatrix GmbH, to quip on Twitter that the oil-club stood for the “Organization of Producers Exempt from Cuts."

The worsening OPEC equation presents Saudi Arabia with a difficult choice after its Algiers U-turn: carry a greater burden within the group, ceding market share to other producers, or lose credibility by softening the terms of the deal. In a worst-case scenario, Saudi Arabia will have to cut production by more than 1 million barrels a day, sending the kingdom’s output to a two-year low.

While oil has rallied more than 15 percent since Algiers, the growing cost of following through is becoming clear. During the last two weeks, Saudi Arabian Energy Minister Khalid Al-Falih has appeared to give himself room for maneuver. In a speech in London last week, he mentioned the possibility of an OPEC freeze as well as a cut. He’s also stressed the need for non-OPEC nations to take part in a global deal to manage supply.

“Oil markets started moving into balance recently, but we in OPEC, along with producers from outside the group, started intense consultations to take the right action to quicken the re-balancing and market recovery,” Al-Falih said Sunday in a speech.

Willing to Cut

In Algiers, OPEC agreed to reduce its production to a range of between 32.5 and 33 million barrels a day. That leaves Saudi Arabia and other countries willing to cut facing two very different potential outcomes.

In a best-case scenario -- based on Nigeria meeting its target to restore production, Libya maintaining recent improvements and Iran, Iraq and Venezuela staying at September levels -- reductions of 1.3 million barrels a day would be required to meet the top end of the Algiers target. In a worst case, where Iran, Iraq and Venezuela produce more than they did last month, that rises to over 2 million barrels a day, based on Bloomberg calculations.

“Everyone has a lot to lose if they do not fill in the details and implement a final agreement at the end of next month,” said Mike Wittner, global head of oil research at Societe Generale SA. “Of all the developments, the one that worries me the most for posing an issue for the other members of OPEC is Iraq.”

OPEC representatives and counterparts from countries outside the group will meet in Vienna later this week to discuss how the burden of output cuts is shared. The most contentious topic is likely to be how the production of individual countries is measured.

Since Algiers, Iraq and Venezuela have criticized OPEC estimates of their production, which are compiled from secondary sources that include independent analysts and news organizations. Those estimates will form the basis for any future OPEC deal limiting production, according to the group’s secretary-general.

Islamic Militants

Iraq, which said over the weekend it shouldn’t be required to cut production as it’s fighting Islamic militants, says it’s currently pumping more than 4.7 million barrels a day, higher than estimates from OPEC’s secondary sources of 4.46 million barrels a day for September.

Venezuela is also dissatisfied with its OPEC estimates since they don’t include heavy crude production from the Orinoco basin, Oil Minister Eulogio del Pino said earlier this month.

OPEC agreed in Algiers that Libya, Nigeria and Iran should receive special treatment as they’re seeking to increase their production after experiencing disruptions due to internal violence, sabotage and sanctions. So far this month, Libya and Nigeria have managed to increase their daily output by 220,000 barrels and 300,000 barrels respectively.

Russian Stance

Iran has steadily increased its crude production since the start of the year following the lifting of sanctions. Tehran has repeated it aims to ramp up its production to a level around 4 million barrels day from around 3.7 million a day estimated by OPEC for September.

Russia -- the biggest oil producer outside OPEC -- has agreed to play a part in stabilizing the markets and is discussing different options including a freeze in output, according to the Energy Minister Alexander Novak. Production cuts are not an option for Russia, the nation’s envoy to OPEC said, according to Interfax.

While OPEC members from Angola and Gabon to Algeria and Ecuador could contribute to the required output cuts, Saudi Arabia’s main support will come from its Gulf allies of Kuwait and the United Arab Emirates, according to Wittner.

Torbjorn Kjus of DNB Bank ASA expects OPEC to over-promise in Vienna, but under-deliver on implementation. He expects Saudi Arabia to cut output by about 400,000 barrels a day and the U.A.E. to trim a further 100,000 barrels a day. The other members probably won’t comply, he said.

http://www.bloomberg.com/news/articles/2016-10-25/saudi-arabia-faces-worsening-opec-equation-as-exemptions-mount

OPEC: Organisation of Producers Exempt from Cuts

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The world’s biggest oil companies, supported during crude’s collapse by a buoyant refining business, have lost that buffer as brimming fuel stockpiles swamp demand.

Profits from turning oil into gasoline and diesel contracted 42 percent last quarter from a year earlier to an average $11.60 a barrel, the weakest for the time of year since 2010, industry datafrom BP Plc show. The impact of that will be apparent as earnings for the period roll in over the coming weeks.

Refineries benefited from oil’s two-year slide that began in mid-2014 because the cost of feedstock fell while fuel demand rose. That led to over-production and huge stockpiles that now can’t be absorbed. For oil majors including Exxon Mobil Corp. and BP, that erodes a valuable source of income that bolstered earnings for much of the past year amid spending cuts, job losses and project cancellations.

The “best days are over” for refining, said Alan Gelder, vice president for refining, chemicals and oil-market research at consulting firm Wood Mackenzie Ltd. “Don’t expect 2015 to be repeated. We’re expecting some ‘average’ years.”

Every $1 decline in the refining margin cuts BP’s adjusted pretax earnings by $500 million a year, according to its website. The London-based company warned back in July that margins had dropped to their lowest in six years and would remain “under significant pressure.”

BP is expected to report $688.7 million in adjusted third-quarter profit on Nov. 1, 62 percent lower than a year earlier, according to the average of 12 analyst estimates compiled by Bloomberg. Exxon is likely to post a 38 percent decline in earnings on Oct. 28. Royal Dutch Shell Plc may report profit that’s little changed on Nov. 1 following its acquisition of BG Group Plc in February.

Summer in the U.S. and Europe typically boosts refining margins as the driving season increases demand for gasoline. Yet high fuel stockpiles around the world this year pushed third-quarter margins below second-quarter levels in Europe, according to Wood Mackenzie’s Gelder.

For an analysis of commodity markets through the end of the year, click here.

Texas-based refiner Valero Energy Corp. said Tuesday that quarterly net income dropped by more than 50 percent from a year earlier as it announced a cut in 2016 capital spending.

For European refiners, gasoline was on average $7.51 a barrel higher than benchmark Brent crude last quarter, about half its level a year earlier and 40 percent lower than the preceding quarter, according to PVM Oil Associates Ltd. For gasoil, or heating oil, the premium was $9.10 a barrel, 36 percent lower than a year earlier.

Refining margins are likely to stay “depressed” next year as inventories remain high, according to Ehsan Ul-Haq, senior oil-market analyst at KBC Energy Economics.

Making it worse for oil companies is crude’s continued weakness. Though prices have risen more than 80 percent from 12-year lows in January, they’re still half their level before the collapse. Dwindling revenue has forced the industry to cut billions of dollars of investment, boost drilling efficiency and reduce costs. European oil majors are likely to lower capital spending by a third this year from 2014, Barclays Plc analysts wrote in a note last week.

Brent averaged $46.99 a barrel last quarter, 8.4 percent lower than a year earlier and little changed from the prior three months. The global benchmark lost 1.2 percent to $50.20 a barrel at 12:03 p.m. Singapore time.

“Third-quarter earnings will likely again be nothing to write home about, given that oil prices were flat on the second quarter,” said Iain Reid, an analyst at Macquarie Capital Ltd. in London. “We estimate earnings per share will fall another 50 percent from a year ago, although this is now becoming more driven by weaker refining margins than oil prices.”

http://www.bloomberg.com/news/articles/2016-10-25/big-oil-braces-for-more-profit-pain-as-refining-safety-net-slips

Greece named on Wednesday a consortium of France's Total, its biggest oil refiner Hellenic Petroleum and Italy's Edison as the preferred bidder for an offshore gas drilling block in the west of the country.

Greece, which signed up to a third bailout last summer, has made several fruitless attempts over the last 50 years to find big oil and gas reserves. Its debt crisis and important findings in neighbouring countries has prompted the country to step up those efforts.

Last year, Athens tendered 20 offshore blocks in the Ionian Sea and south of the island of Crete for deep sea oil and gas drilling and unsealed the offers in February.

The Total-led consortium has bid for one block in the Ionian Sea, while Hellenic Petroleum has bid independently for two other blocks.

A committee assessing the bids will invite the consortium to finalise the contract, the country's energy ministry said in a statement.

Hellenic Petroleum in a venture with Edison, and Energean Oil , the country's sole oil producer, are already searching for oil in three onshore and offshore blocks in western Greece.

http://www.reuters.com/article/greece-exploration-idUSL8N1CW4O4

A merchant tanker has been the target of an attack of the coast of Yemen on Tuesday, October 25, according to a report by the crisis management and response consultancy NYA.

According to various media reports, the vessel in question was Teekay’s LNG carrier, the 2004-built Galicia Spirit with the capacity to transport up to 137,814 cubic meters.

LNG World News contacted Teekay seeking confirmation of the reports, however, no response has been received by the time this article was published.

NYA said the merchant tanker was approached by a small boat whose occupants fired an RPG at the vessel. The damage at the time of the report was unknown, however, the consultancy said that crew are safe and that the vessel continued with its passage.

The AIS data provided by the vessel tracking website, MarineTraffic, shows that Galicia Spirit departed Qatar’s Ras Laffan LNG complex on October 19 and is scheduled to deliver its cargo to one of the FSRUs serving as Egypt’s liquefied natural gas import terminals in Ain Sokhna on October 29.

http://www.lngworldnews.com/lng-tanker-attacked-off-yemen/

CNOOC Limited today announced its key operational statistics for the third quarter of 2016.

For the third quarter of the year, the Company achieved total net production of 117.7 million barrels of oil equivalent ('BOE'), representing a decrease of 7.7% year-on-year ('YoY'), mainly due to the decline of production volume in oil and gas fields and weak demand in the domestic downstream gas market.

During the period, the Company made one new discovery and drilled ten successful appraisal wells offshore China. During the third quarter, Weizhou 6-9/6-10 comprehensive adjustment project and Enping 18-1 oilfield commenced production. The four projects that were planned to come on stream in 2016 have all commenced production.

For the third quarter of the year, the unaudited oil and gas sales revenue of the Company reached approximately RMB30.75 billion, representing a decrease of 15.2% YoY. The Company's average realized oil price decreased by 13.5% YoY to US$42.26 per barrel, while the average realized gas price was US$5.22 per thousand cubic feet, down 18.6% YoY.

To cope with the low oil price environment, the Company continued to lower costs, enhance efficiency and cut capital expenditure for the whole year. During the period, the Company's capital expenditure amounted to approximately RMB11.67 billion, representing a decrease of 20.9% YoY.

Mr. Yang Hua, Chairman and CEO of the Company, said, 'In view of the market challenges during the third quarter of the year, the Company endeavored to lower costs and enhance efficiency, as well as made proactive efforts in all fields. In addition, the Company is confident in meeting the full year target of its key operating indicators.'

http://www.oilvoice.com/n/CNOOC-announces-key-operational-statistics-for-third-quarter-2016/89127c23600b.aspx

In September 2015 MDN brought you the news that two joint venture partners, MPLX (Marathon Petroleum) and Enterprise Products Partners, were actively evaluating a plan to reverse the flow of the 795-mile Centennial Pipeline to send natural gas liquids (NGLs) from the Utica/Marcellus to the Gulf Coast.

The Centennial began operation in 2002 after a 26-inch diameter natural gas line from Longville, LA into Bourbon was converted to refined light product service. At the same time, a new 24-inch diameter line was constructed from Beaumont, TX to connect to the existing 26-inch diameter line at Longville, TX.

Since last year we had not heard any concrete plans–until now. Yesterday at the S&P Global/Platts ninth annual Appalachian Oil & Gas Conference in Pittsburgh, Enterprise announced it is “a go” to reverse the Centennial…

http://marcellusdrilling.com/2016/10/centennial-pipeline-reversal-a-go-to-send-ne-ngls-to-gulf-coast/

Russia's Gazprom Neft energy company has discovered a new oil field in the country's northern Yamalo-Nenets Autonomous Area, the company said in a press release on Wednesday. 

"According to the results of drilling of the three search and exploratory oil wells, six… deposits of oil, with total geological reserves of more than 40 million tonnes have been discovered. 

The resources of a new Zapadno-Chatylkinskoye oil field have been approved at the State Commission on Mineral Reserves," the press release said.

Read more: https://sputniknews.com/russia/201610261046749694-russia-gazprom-oil-field/

Statoil Q3 lags forecast, cuts capex again

Norwegian oil firm Statoil cut its 2016 capital expenditure again after posting third-quarter earnings below forecast on Thursday due to lower-than-expected output and persistently low oil prices.

Like other oil companies, Statoil has been slashing investments, jobs and projects to cope with a 56-percent decline in the price of crude since mid-2014.

On Thursday it said it would cut its capital expenditure for 2016 to $11 billion from $12 billion and its exploration spending to $1.5 billion from $1.8 billion.

In July, the company had already reduced those figures from $13 billion and $2 billion respectively.

"The financial results were affected by low oil and gas prices, extensive planned maintenance and expensed exploration wells from previous periods," Statoil CEO Eldar Saetre said in a statement.

The firm's adjusted operating profit fell to $636 million in the third quarter from $2 billion a year ago, well below analysts' expectations for $950 million. All three divisions of the company missed forecasts.

http://www.cnbc.com/2016/10/27/statoil-q3-lags-forecast-cuts-capex-again.html

U.S. crude oil refinery inputs averaged about 15.6 million barrels per day during the week ending October 21, 2016, 182,000 barrels per day more than the previous week’s average. Refineries operated at 85.6% of their operable capacity last week. Gasoline production increased last week, averaging over 9.8 million barrels per day.

 Distillate fuel production decreased last week, averaging over 4.5 million barrels per day. U.S. crude oil imports averaged over 7.0 million barrels per day last week, up by 109,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 7.4 million barrels per day, 2.1% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 834,000 barrels per day. Distillate fuel imports averaged 74,000 barrels per day last week.

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 0.6 million barrels from the previous week. At 468.2 million barrels, U.S. crude oil inventories are near the upper limit of the average range for this time of year. Total motor gasoline inventories decreased by 2.0 million barrels last week, but are well above the upper limit of the average range. Both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories decreased by 3.4 million barrels last week but are above the upper limit of the average range for this time of year. Propane/propylene inventories fell 2.1 million barrels last week but are near the upper limit of the average range. Total commercial petroleum inventories decreased by 8.7 million barrels last week.

Total products supplied over the last four-week period averaged about 20.4 million barrels per day, up by 4.3% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged over 9.1 million barrels per day, down by 0.1% from the same period last year. Distillate fuel product supplied averaged about 4.1 million barrels per day over the last four weeks, up by 2.5% from the same period last year. Jet fuel product supplied is up 6.5% compared to the same four-week period last year.

Cushing down 1.3 mln bbls

   
                                                                    Last Week   Week Before       Last Year

Domestic Production '000.................. 8,504                 8,464                9,112
Alaska ................................................ 501                    489                    505
Lower 48 ........................................ 8,003                 7,975                8,607

http://ir.eia.gov/wpsr/overview.pdf

By Christopher Sell
(Bloomberg) -- Breakeven prices in key shale plays in the
U.S. have dropped by 55 percent in the last three years,
according to research by Rystad Energy. Average breakeven prices
at the Bakken have dropped from around $67 a barrel in 2013 to
$29 a barrel in 2016. A greater focus on core areas of the shale
plays and improved well performance are the main drivers to the
lower price, the report said.

Oil major BP is set to ship 1 million barrels of U.S. crude to Australia and Thailand by the end of this year in what would be the first U.S. crude imports for the two Asian-Pacific countries, Reuters reported on Wednesday, quoting three trade sources.

BP has sold 300,000 barrels of U.S. crude to Thai company PTT PCL and will ship the other 700,000 barrels to its own refinery in Australia, the Reuters sources said, adding that the London-based oil giant will load the crude from the U.S. Gulf Coast on a tanker expected to dock in Asia in December.

According to BP’s refining in Australia page, the company’s refinery currently processes crude oil shipped from the Middle East, West Africa, New Zealand, Indonesia and north-west Australia.

BP’s shipment to Thailand and Australia would be the company’s at least fifth cargo of U.S crude bound for Asia Pacific in 2016, after the U.S. repealed a four-decade-old ban on crude exports in December of last year.

BP seeks to raise U.S. crude exports to meet the healthy Asia Pacific demand. Traders also want to send more U.S. oil to Asia, but so far, the lower shale production and the very tight spread between the WTI and Brent prices for most of the year have not allowed them to take advantage of a profitable arbitrage window.

BP may start processing U.S. crude at its Australian refinery, but it has backed out of some of its upstream plans in Australia. BP hasquit a US$600-million drilling operation in the Great Australian Bight. The project was not in line with BP’s “strategic goals,” the company said. Another reason for the withdrawal could be the strong public opposition to drilling for oil in the pristine Bight, and several regulatory delays, including two rejections from Australia’s National Offshore Petroleum Safety and Environmental Management Authority.

http://oilprice.com/Latest-Energy-News/World-News/BP-To-Sell-US-Crude-To-Australia-Thailand-For-First-Time.html?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+oilpricecom+%28Oil+Price.com+Daily+News+Update%29

Third Quarter Highlights:

* Net loss was $339 million, or $1.12 per common share, compared with a net loss of $279 million, or $0.98 per common share, in the prior-year quarter
* Adjusted net loss was $340 million, or $1.12 per common share, compared to an adjusted net loss of $291 million, or $1.03 per common share, in the third quarter of last year
* Reduced E&P capital and exploratory expenditures by 49 percent to $435 million from $849 million in the prior-year quarter
* Oil and gas production was 314,000 barrels of oil equivalent per day (boepd); Bakken net production was 107,000 boepd
* Successful Liza-3 well in the Stabroek block, offshore Guyana (Hess 30 percent), confirms world class oil discovery; estimated recoverable resources for Liza now expected to be at the upper end of the previously announced range of 800 million to 1.4 billion barrels of oil equivalent
* Issued $1 billion of 4.30% notes due in 2027 and $500 million of 5.80% notes due in 2047; proceeds to be used primarily to purchase or redeem higher-coupon bonds and near-term maturities ($750 million of proceeds used through September 30, 2016)
* Cash and cash equivalents were $3.5 billion at September 30, 2016 ($625 million committed for debt retirement in October)

Hess Corporation (NYSE: HES) today reported a net loss of $339 million, or $1.12 per common share, in the third quarter of 2016 compared with a net loss of $279 million, or $0.98 per common share, in the third quarter of 2015. On an adjusted basis, the Corporation reported a net loss of $340 million, or $1.12 per common share, in the third quarter of 2016 compared with an adjusted net loss of $291 million, or $1.03 per common share, in the prior-year quarter. Third quarter 2016 after-tax results reflect lower production and realized selling prices compared with the third quarter of 2015, as well as lower operating costs and depreciation, depletion and amortization expenses.'Our company continues to take steps to maintain a strong balance sheet and materially reduce our spending,' Chief Executive Officer John Hess said. 'We also are investing in growth projects including the world-class Liza oil discovery in Guyana that we believe will create significant value for our shareholders. Based on the positive results of the Liza-3 well, we now expect Liza to be at the upper end of the previously announced estimated recoverable resources range of 800 million to 1.4 billion barrels of oil equivalent.'

http://www.oilvoice.com/n/Hess-Corporation-announces-third-quarter-2016-net-loss-of-339-million/7e0dbf6bc66c.aspx

* Q3 2016 Net Cash Provided by Operating Activities of $151 Million Exceeds Capex by $66 Million
* Q3 2016 Average Production of 119,890 BOE/d at High End of Guidance
* Q3 2016 LOE Below Low End of Guidance at $7.98 per BOE
* Williston Basin 5+ Million Pound Completions Continue to Track 900 MBOE Type Curve after 265 Days
* Williston Basin 10+ Million Pound Completions Tracking 1,500 MBOE Type Curve
13 New McKenzie County Wells Test at Average Rate of 3,727 BOE/d

Whiting’s (NYSE: WLL) 2016 third quarter capex of $85 million was under budget and relatively flat with the second quarter. Production in the third quarter came in at the high end of guidance and totaled 11.0 million barrels of oil equivalent (MMBOE), an average of 119,890 barrels of oil equivalent per day (BOE/d). Production was comprised of 85% crude oil/natural gas liquids (NGLs). Whiting continued to lower its lease operating expense (LOE). LOE for the third quarter averaged $7.98 per BOE, below the low end of guidance. Third quarter LOE benefitted from the sale of higher operating expense North Ward Estes properties, continued operating efficiencies and better than anticipated production results.

James J. Volker, Whiting’s Chairman, President and CEO, commented, “During the third quarter, we continued to improve our capital efficiency with production at the high end of guidance on lower than projected capital spending, and LOE per BOE improving to $7.98 per BOE on the sale of North Ward Estes. This resulted in our net cash from operating activities exceeding our capital spending by $66 million. In the Williston Basin, the combination of high quality acreage and innovative completion methods drove solid results. Our thirteen new wells completed in McKenzie County tested at an average rate of 3,727 BOE/d and our leading edge design 10+ million pound completions in Williams County are tracking a 1,500 MBOE type curve. We believe the focus on balance sheet strength and capital spending discipline in the first nine months of 2016 provides us with a strong financial base to continue to deliver solid operational results and realize the potential of our world class asset base.”

Lots more: http://www.businesswire.com/news/home/20161026007005/en/Whiting-Petroleum-Corporation-Announces-Quarter-2016-Financial

RANGE RESOURCES CORPORATION announced its third quarter financial results.

Highlights

* Merger with Memorial Resource Development Corp. ('Memorial') closed on September 16th
* Gulf Markets Expansion pipeline on line in early October improves natural gas netbacks by moving 150,000 Mmbtu per day of Range natural gas from Appalachia to Gulf Coast markets
* North Louisiana production growth and additional takeaway projects result in better natural gas differentials going forward
* New condensate sales agreements commenced July 1, improving condensate prices by approximately $7.00 per barrel compared to the previous quarter
* NGL pricing improved to 25% of WTI compared to 13% of WTI in the prior-year quarter
*Third quarter production averaged a record 1,508 net Mmcfe per day
* Southern Marcellus production averaged a record 1,228 net Mmcfe per day, up 23% from the prior-year quarter
Unit costs improved by 3%, or $0.09 per mcfe, compared to prior-year quarter

Commenting, Jeff Ventura, the Company's CEO said:

'Range reached another milestone in the Company's history with the closing of the Memorial merger on September 16th. Combining the North Louisiana stacked pay assets with our extensive Marcellus/Utica inventory makes Range a better and stronger company, with geographic diversity that allows us flexibility in capital allocation and marketing. The integration of North Louisiana's operations is going well and we expect the combined experience and skills from both teams will enhance the value of these high-quality assets.

Third quarter results were encouraging, as production increased, unit costs improved and unhedged cash margins rebounded. We are excited as we look forward to fourth quarter 2016 and the full year 2017, as we anticipate improving margins on all of our products and continued improvement in capital efficiency across the Company. With our extensive opportunity set in two high-quality natural gas plays, we believe Range is in a great position to drive shareholder value for many years to come.'

http://www.oilvoice.com/n/Range-Resources-Corporation-announces-third-quarter-2016-results/c73c1da0308b.aspx?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+OilvoiceHeadlines+%28OilVoice+Headlines%29

Suncor Energy Inc, Canada's largest oil and gas company, reported a better-than-expected third-quarter profit on Wednesday thanks to strong upstream production, lower operating costs and record crude throughput at its refineries.

The company reported net earnings of C$392 million ($293 million), or 24 Canadian cents per share. In the year-prior quarter, Suncor recorded a net loss of C$376 million, or 26 Canadian cents a share, which included an unrealized after-tax foreign exchange loss of $786 million on the revaluation of U.S. dollar-denominated debt.

Suncor's third-quarter operating profit, which excludes one-time items, was C$346 million, or 21 Canadian cents per share, versus C$410 million, or 28 Canadian cents per share, in the year-ago period.

Analysts had predicted earnings of 9 Canadian cents per share, according to Thomson Reuters I/B/E/S.

Calgary-based Suncor is the biggest producer in Canada's oil sands and also has operations offshore Atlantic Canada and in the North Sea. The company produced 728,100 barrels of oil equivalent per day in the third quarter, up from 566,100 boepd in the same period of 2015, due mainly to becoming the majority owner of the Syncrude project.

Syncrude, a mining and upgrading project in northern Alberta, has been dogged by operating issues over the years, but Suncor said upgrader reliability improved to 98 percent in the third quarter and operating costs dropped to C$27.65 per barrel from C$41.65 per barrel in the year-prior quarter.

Suncor also owns a number of thermal oil sands projects and a mining and upgrading plant near Fort McMurray, Alberta. Production rebounded after wildfires in the region in the second quarter shut down facilities for several weeks.

Total third-quarter oil sands production was 433,700 bpd, compared with 430,300 bpd a year previously, with increased output from thermal projects offset by lower synthetic crude volumes as a result of unplanned maintenance.

Oil sands operating costs fell to $22.15 a barrel in the quarter from $27 a barrel a year prior because of lower natural gas prices, cost reductions and increased production.

"Our cost reduction efforts combined with safe, reliable operations have delivered the lowest cash costs per barrel at our oil sands operations in over a decade and Syncrude delivered similar improvements," Suncor Chief Executive Steve Williams said.

The company is divesting non-core assets, and said it had advanced the sales process for its lubricants business, as well as starting the sales process for some assets and liabilities related to its renewable energy business.

Average refinery throughput improved to a record 465,600 bpd from 444,800 bpd in the prior-year quarter.

http://www.reuters.com/article/us-suncor-energy-results-idUSKCN12R01H

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