Update for investors conversely highlights Hebron sanction as a positive
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Terra Nova FPSO heads along the Newfoundland coast near St. John's.
Restarting production at the Terra Nova offshore oil project proved to have its challenges, according to Suncor’s latest update for investors.
In its report on the fourth quarter 2012, Suncor Energy states it took in $1 billion in operating earnings, down from $1.4 billion for the same quarter the previous year. That decrease can mainly be credited with challenges in its main business in the Oil Sands, according to the energy company’s president.
However, the re-start of production on the Terra Nova project off Newfoundland and Labrador caused enough of a headache to receive mention.
"Although we are pleased with our underlying cost discipline and performance trends, we know there are areas we need to improve,” said Steve Williams, Suncor president and chief executive officer in a statement. “Our reliability at our oil sands upgraders and the delays associated with our Terra Nova planned maintenance were disappointing. However, we remain committed to a relentless focus on operational excellence to improve performance."
Production from the largest of three drill centres at Terra Nova is now back up following maintenance work on the Terra Nova FPSO.
“The second drill centre was connected in January and is currently being commissioned. The third drill centre is expected to be reconnected in the third quarter of 2013, when damaged flow lines can be replaced,” states the Suncor quarterly report.
On the other hand, Suncor has highlighted the positive news of the sanctioning of the Hebron project, “Suncor’s fourth joint venture megaproject off Newfoundland and Labrador.”
The company has an approximately 23 per cent interest in Hebron and expects first oil in late 2017.
Suncor's estimates its share of the project capital cost at about $3.2 billion.