Suncor Energy Maintained at Hold at TPH Following 2024 Production Release; Price Target at C$62.00

Canadian integrated oil company Suncor on Monday said it achieved a series of fourth quarter and full-year 2024 operational records, while cutting debt well ahead of schedule.

The Calgary-based company said Q4 production rose to a record 874,000 b/d, up 66,000 b/d from the same period of 2023. Suncor said its Firebag complex contributed 250,000 b/d to output and reported record production at Fort Hills where 168,000 b/d of oil moved to market.

It put 2024 production at 827,000 b/d, up by 81,000 b/d, or about 11%, from 2023.

Suncor also reported that it ran an average of 487,000 b/d of crude and other feedstock at its four refineries in Q4, on par with the third quarter and 31,000 b/d more than in the same period of 2023. All four North American refineries operated at greater than 100% capacity, it added.

Suncor said its Q4 refined product sales in 2024 averaged 599,000 b/d or about 19,000 b/d, another all-time high. Sales were up by 46,000 b/d, or about 8%, from 2023.

President and Chief Executive Rich Kruger said in a news release that the operational results allowed the company to achieve its $8 billion net debt target nine months earlier than it had projected in May.

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--Reporting by Tom Kloza, tkloza@opisnet.com; Editing by Jeff Barber, jbarber@opisnet.com

Suncor Energy kept its Outperform rating and $66 price target, RBC Capital Markets said in a Monday note.

Suncor recently outlined production of 874,000 barrels per day (bbl/d) in the fourth quarter of 2024, the highest quarterly production in the company's history.

The output also came in 5% above the Street consensus forecast of 835,600 bbl/d and 7% higher than RBC's estimate of 815,000 bbl/d.

Sunoco's share price was up 3% at last look to $54.57 on the TSX.

Suncor Energy had its Outperform stock rating and $65 price target confirmed by National Bank of Canada after the company provided an operational update after markets closed on Monday.

The update highlightes stellar performance across the portfolio in terms of fourth-quarter and full-year 2024 volumes, the bank said.

With assets outperforming the bank's and Wall Street estimates, National Bank said it expects production and cash flow per share estimates to trend higher in the coming days to account for the stronger-than-forecast end to the year.

The bank also expects 2025 to be another strong year for Suncor.

In the upstream, the company posted many records, including record quarterly and annual production of 874,000 barrels per day (b/d) and 827,000 b/d, respectively. This compares with the bank's estimates of 863,000 b/d and 825,000 b/d, respectively, and Wall Street's 831,000 b/d and 809,000 b/d, respectively.

In the downstream, Suncor posted both quarterly and annual refining throughput records of 487,000 b/d and 465,000 b/d, respectively, with record annual utilization of 100%.

The results are likely the key driver for significant buybacks seen in the fourth quarter of 2024, with about $1 billion worth of shares repurchased that quarter, the bank noted.

TPH Energy Resources provided Tuesday fourth-quarter production estimates for oil sands companies.

TPH estimates Cenovus' combined (Foster Creek & Christina Lake) FCCL volumes averaged about 454,000 barrels per day (mbpd) in November for a quarterly average of 451 mbpd, compared to TPH's modeled 443 mbpd for the fourth quarter, with Foster Creek up 10mbpd m/m to an estimated 200mbpd for a 195mbpd Q4 2024 average (TPH estimated Q4'24 197mbpd). Christina Lake volumes at 254mbpd were down an estimated 3mbpd m/m for a Q4'24 avg. of 255mbpd (TPHe Q4'24 246mbpd).

Production at Sunrise held flat month over month in November at 53mbpd (Q4 2024 average 53mbpd vs. TPH estimate 60mbpd), while Lloyd volumes sat at near 103mbpd in November with a Quarter To Date average of about 105mbpd (TPHe 110mbpd Q4'24).

Imperial Oil 's Cold Lake volumes were up 3 mbpd month over month in November to an estimated 163 mbpd for a fourth-quarter average of 162 mbpd, compared to TPH's projection of 166 mbpd.

Production at Suncor's Firebag operation was down about 4 mbpd to 247 mbpd for a fourth quarter average of 249 mbpd, compared to TPH's estimate of 242mbpd, while volumes at MacKay River were up near 3mbpd m/m to 36mbpd (Q4 2024 average 35mbpd, TPH estimate 35mbpd Q4'24).

According to TPH, CNQ's Kirby projects fell about 2mbpd month over month to 62mbpd (Q4'24 avg. 63mbpd, TPH estimate 67mbpd Q4'24), while Primrose Wolf Lake rose 13mbpd m/m at near 83mbpd — Q4'24 avg. of about 77mbpd. Lastly, Jackfish volumes increased about 1mbpd m/m to 122mbpd for a Q4'24 avg. of 121mbpd (TPH estimate 115mbpd for Q4'24).

For MEG, the company's September volumes fell 6 mbpd month over month to an estimated 95 mbpd for a fourth quarter average of 98 mbpd, compared to TPH's estimate of 104.5 mbpd for the quarter.