MEG Energy profits rises on higher output, lower costs

Reuters

(Corrects 3rd paragraph to make clear MEG loads crude on bargesin U.S.)

Oct 24 (Reuters) - Canadian oil sands producer MEG EnergyCorp's third-quarter profit more than doubled driven bya rise in output, lower operating costs and stronger pricerealizations.

The company also said it expects to finish the year in theupper half of its production forecast of 32,000 to 35,000barrels per day (bpd).

Earlier this year, MEG began sending crude to the Chicagoarea via pipeline or rail, and then loading it onto barges fortransport down the Mississippi River system. It also plans tostart shipping significant volumes of crude by rail from theCanexus terminal in Bruderheim, Alberta, to avoid congestion onpipelines.

The company, whose key operations are in the southernAthabasca oil sands region of Alberta, said production rose 20percent to 34,246 bpd in the third quarter ended Sept. 30.

Net income rose to C$115.4 million ($111.06 million), or 51Canadian cents per share in the quarter, from C$47.5 million, or24 Canadian cents, a year earlier.

The company's cash flow rose almost six-fold to C$144.5million, or 64 Canadian cents per share.

MEG Energy shares closed at C$34.17 on the Toronto StockExchange on Wednesday. ($1 = 1.0389 Canadian dollars) (Reporting by Nia Williams and Sneha Banerjee in Bangalore;Editing by Savio D'Souza)

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