Feb. 8 (UPI) -- While production was relatively stable, Canadian oil company Suncor said its net earnings in the fourth quarter more than doubled from last year.
Suncor recorded operating earnings of $1 billion (USD) in the fourth quarter, compared with $504 million in the same period for 2016. Net earnings of $1.1 were nearly three times the amount from last year.
The company noted that it was supported by the ability to defer about 10 percent of that because of the decrease in the U.S. corporate tax from 35 percent to 21 percent. U.S. supermajor Exxon Mobil last week disappointed when it attributed most of its quarterly earnings to the corporate tax reduction.
The National Energy Board, the Canadian regulator, reported total production last year averaged 4.2 million barrels of oil and oil equivalent per day, an 8 percent improvement from the previous year. Suncor said its production of oil sands, a thicker type of oil found in Canada, averaged 446,800 bpd in the fourth quarter, a 3 percent increase year-on-year. Total production, however, was slightly less than the previous year.
Suncor announced in late January that it started producing the first batches of oil from its Fort Hills project in Alberta. Over the next few months, production should reach its peak at about 194,000 bpd.
Steve Williams, the company's president and CEO, said at the time it was one of the best long-term growth projects in its portfolio.
The new production comes at a time when traders are looking at the balance between supply and demand. A surplus, led by strong gains in North America and by the previous policy of the Organization of Petroleum Exporting Countries to defend a market share with robust production, pushed the price of oil below $30 per barrel in early 2016.
The price for Brent crude oil, the global benchmark, was around $65 per barrel early Thursday. Suncor said it realized an operating cost for oil sands operations of $19 per barrel, about a dollar less than fourth quarter 2016.
"Our continued focus on disciplined cost management, combined with improved overall reliability, drove annual oil sands cash operating costs below $20 (USD) per barrel for the first time in ten years," Williams said in a statement.