Page 25 - Suncor AR English

Suncor’s integrated model and relentless focus on Key decisions that are aligned with the company’s

capital discipline have delivered consistent cash flows strategy to focus on long-term profitable growth.
in a volatile price environment
• The sanctioning of the Fort Hills mining project, the

Suncor’s well-established operating model and focus on sale of the company’s conventional natural gas
capital discipline as well as long-term profitable growth business, and the decision not to proceed with the
Voyageur upgrader project have re-positioned Suncor’s
have resulted in significant free cash flow(1).
portfolio, building a strong foundation for long-term
• Cash flow from operations for 2013 exceeded capital profitable growth.
and exploration expenditures by more than $2.6 billion,
• With a significant reserves and resources base, Suncor
and was higher than net debt at year end by
$3.2 billion.
continues to assess potential in situ growth prospects
at MacKay River, Meadow Creek, Firebag and Lewis.
• The company’s solid financial position reaffirmed its
• In addition to Golden Eagle and Hebron, the company
ability to deliver reliable and sustainable returns to its
shareholders and fund its 2013 capital program with is advancing a number of extension opportunities while
expanding its offshore exploration prospects in Norway.
cash flow from operations.

Investing in integration and market access.
Record Oil Sands production achieved through
important milestones and strong operational As North American commodity prices remain volatile and
Suncor’s Oil Sands production continues to rise, enhancing
performance.
access to global markets helps to maximize profitability and
In 2013, the Oil Sands business delivered another record-
operational flexibility.
setting year, resulting in an 11% increase in annual
production at Oil Sands Operations and record annual SCO • Suncor commenced rail shipments of inland crudes to
its Montreal refinery in the fourth quarter of 2013,
production. These results were achieved despite a major
turnaround in the second quarter and third-party outages enabling the company to take advantage of the price
differentials between inland and Brent crudes.
that impacted Oil Sands Operations during the year.
• In early 2014, Suncor commenced shipments of heavy
• Strong project execution has allowed the company to
nearly triple its production at Firebag in three years. crude on the Gulf Coast Pipeline, providing the
company with more than 50,000 bbls/d of heavy crude
The fourth quarter of 2013 marked the completion of
the ramp up at Firebag, with daily production rates shipping capacity to the U.S. Gulf Coast, a profitable
outlet for the growing bitumen production at Firebag.
reaching approximately 95% of capacity.
• Suncor’s flexible model allows it to take advantage of
• Suncor has facilitated this growth by building strong
fluctuating North American crude price differentials. In
midstream capabilities while also increasing operational 2013, discounted crudes were being supplied to the
flexibility. The commissioning of the hot bitumen Montreal refinery via rail or ship, while projects were

infrastructure in 2013, including the ability to import also underway to enable the Montreal refinery to
third-party diluent, has increased the takeaway capacity process heavier crude feedstock.
of bitumen and unlocked production in mining.

A continued focus on operational excellence and

Capitalizing on low-cost growth opportunities to improved reliability.
steadily increase returns.
• Suncor achieved an annual refinery utilization rate of

• Following a decade of large expansions at Oil Sands
94% and record upgrading reliability, despite planned
Base and Firebag, Oil Sands Operations has the maintenance and third-party outages in 2013.

opportunity for production growth through low-cost • Demonstrated reliability and continuous improvements
debottlenecking, expansions and increased reliability.
at Suncor’s refineries resulted in a nameplate capacity
• The company plans to advance a number of increase for the Edmonton refinery for a second year in
a row. The company’s total refining nameplate capacity
debottlenecking initiatives across Oil Sands Operations
and expansions at In Situ, building on the recent of 462,000 bbls/d represents a 4% increase since 2011.

success of the hot bitumen infrastructure.
• Suncor successfully executed planned maintenance
across its operations, including a seven-week
• These initiatives are expected to grow production at
existing Oil Sands Operations sites to approximately turnaround at Upgrader 1, a ten-week off-station
maintenance program at Terra Nova and planned
500,000 bbls/d by the end of 2018.
maintenance at each of its refineries.

(1) Operating earnings, cash flow from operations, ROCE and free cash flow are non-GAAP financial measures. See the Advisories – Non-GAAP Financial
Measures section of this MD&A.

SUNCOR ENERGY INC. ANNUAL REPORT 2013 21