CALGARY—Suncor Energy has set a capital budget for 2016 that’s $900 million higher than what it expects to spend this year.
That’s despite the company’s gloomy outlook for commodity prices next year: U.S. benchmark crude unchanged at US$50 a barrel and a Canadian heavy oil price that’s $2 lower than this year’s forecast.
Canada’s dominant oilsands producer aims to spend between $6.7 billion and $7.3 billion next year—a range it says offers the flexibility to respond to changing market conditions.
In October, Suncor said it was on track to finish 2015 with capital expenditures of between $5.8 billion and $6.4 billion.
Company-wide output next year is expected come in at between 525,000 and 565,000 barrels a day.
It’s lower than this year’s projected range of between 550,000 and 595,000 barrels a day because of planned maintenance that’s to take place at some oilsands projects.
Cash costs in the oilsands are seen dropping by a dollar a barrel to between $27 and $30.
In October, Suncor launched an all-stock hostile takeover bid for Canadian Oil Sands Ltd. (TSX:COS) worth about $6.9 billion when the target company’s debt is taken in to account.