Another oilsands project strains its budget
Last Updated: Thursday, May 3, 2007 | 4:22 PM ET
CBC News
Canadian Natural Resources has become the latest Alberta's oilsands player to warn of rising development costs.
The Calgary-based energy giant said construction costs for the first phase of its Horizon oilsands project could exceed the original $6.8-billion cost by between $340 million and $816 million.
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"We remain on schedule despite heavier than normal snowfall over the 2006-2007 winter season, which resulted in a below-forecast ramp-up for some contractors along with lower productivity for others," Canadian Natural senior vice-president Real Doucet said in a statement.
As cost overruns go, Horizon's is one of the smaller ones. Some oilsands players — such as Synenco — have seen their development costs jump by billions of dollars.
Canadian Natural also reported quarterly results Thursday that showed its profits almost quintupled over the same quarter last year.
It made $269 million in Q1, compared to a profit of $57 million a year ago.
Earnings from operations rose 132 per cent to $621 million. That beat analysts' average estimates and helped to boost the firm's share price by $2.28 to $69.63 — a new 52-week high.
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