Canadian Natural Resources Ltd posted a quarterly loss on Thursday compared with a year-ago profit, hurt by the sharp decline in oil prices caused by the novel coronavirus outbreak and a price war between Saudi Arabia and Russia.
Canada’s largest oil and gas producer also withdrew its 2020 production outlook and said it would curtail production by roughly 14 per cent for May due to weak prices and uncertainty around the outbreak of COVID-19, the respiratory illness caused by the coronavirus.
But the Calgary, Alberta-based company maintained its quarterly dividend of $0.425 per share, in contrast with rivals including Suncor Energy that have cut payouts to preserve cash.
Average realized prices for crude and natural gas liquids fell by more than half to $25.90 per barrel in the first quarter, before risk management.
Alberta’s hopes of a rebound this year for the Western Canadian province’s long-struggling oil industry have been dashed by the crash in global crude prices, which has forced companies to adopt cost-cutting strategies. Canadian Natural has slashed management pay and its spending budget.
Canadian Natural’s production, however, rose nearly 14 per cent in the first quarter as the company took advantage of the Alberta government’s special production allowance, which permits additional oil output if it moves by rail.
The company said it would curtail about 120,000 barrels per day (bpd) of production for May, adding to wider pullbacks across the industry.
Canadian producers have cut output by about 1 million bpd and could lower production further to accelerate maintenance work at production facilities, Canadian Natural President Tim McKay told analysts.
Canadian Natural said production at its Athabascan oil sands project will be 100,000 bpd lower than normal on a net basis in July and August due to maintenance.
The company’s net loss stood at $1.28 billion, or $1.08 per share, in the quarter ended March 31, compared with a profit of $961 million, or 80 cents per share, in the year-ago period.
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