Canadian Natural Expect Oil Production Result Stay Course Despite Forest Fire

Canadian Natural released its second quarter results on August 6th, 2015 displaying a loss of $405 Million. Despite those figures and the two-week shutdown at The Primrose Operations in late May- early June, due to a wildfire at the Cold Lake Air Weapons Range, the company says it expects to deliver its projected annual oil production.

The company says its second quarter was strong despite the displayed loss and the forest fire

Canadian Natural incurred a net loss of $405 million in Q2 2015 largely driven by the changes in corporate income tax rates.  Accounting rules guide when and how to report changes to income tax liabilities. In this case, the change in corporate tax rates from 10% to 12%  has resulted in a $579 million charge or increase to Canadian Natural’s future income tax liability. The $579 million is booked against earnings in Q2 2015 for accounting purposes, but will result in $579 million of future cash flows being transferred to the Government as income from our longer life assets is realized.

The company further states:

 Canadian Natural is built to weather commodity price cycles given our large, diverse asset base of which our Primrose and Wolf Lake Operations are a key component. Our effective and efficient operations help us control costs (Operating and Capital) and generate cash flow in low price environments. As reported in our earnings release, Canadian Natural has achieved strong operating cost reductions across our operations. Our staff will continue to maintain operations as well as effectively and efficiently deliver on the plans we have for 2015 as well as prepare for projects beyond 2015. We do not have plans to reduce staff.