Suncor Expects More Carbon Emission from Higher Production
Per its latest annual sustainability report, Canada’s biggest energy firm and the largest oil sands outfit, Suncor Energy Inc. SU, expects a rise in greenhouse gas emissions with an increase in its production.
The company anticipates a surge in greenhouse gas emission from 20.5 million metric tons in 2014 to 26.2 million metric tons through 2019. Higher production of oil sands is likely to increase carbon release. Especially, production from Alberta-based Fort Hills mine, which is likely to commence from 2017, will increase pollution.
Alberta-based Suncor is the premier integrated energy company in Canada. Suncor's operations include oil sands development and upgrading, conventional and offshore crude oil and gas production, petroleum refining, and product marketing under the Petro-Canada brand. Suncor has significant oil sands and conventional production platform; huge, long-lived oil-sands reserves; and an impressive downstream portfolio.
For the second quarter of 2015, the company reported operating earnings per share of 51 cents, which marched past the Zacks Consensus Estimate of 25 cents. Moreover, quarterly revenues of $6.6 billion surpassed the Zacks Consensus Estimate of $5.7 billion. A favorable downstream business environment led to the better-than-expected results.
Suncor remains focused on the production of crude from the Alberta oil sands. This is a high-risk strategy given the extra costs associated with oil extraction from the oil sands compared with production from conventional oil wells.
Currently, the company carries a Zacks Rank #3 (Hold), which implies that the stock will perform in line with the broader U.S. equity market over the next one to three months.
Some better-ranked players from the energy sector are Seadrill Partners LLC SDLP, Alon USA Partners, LP ALDW and Halcón Resources Corporation HK. All the three stocks sport a Zacks Rank #1 (Strong Buy).
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