Suncor Energy reports higher Q4 earnings mostly due to PetroCan merger.

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CALGARY - Suncor Energy Inc. (TSX:SU) is reporting fourth quarter 2009 net earnings of $457 million, or 29 cents per common share.
That compares to a net loss of $215 million, or 24 cents per common share, for the fourth quarter of 2008.
Ten analysts polled by Thomson Reuters were on average expecting earnings of 42 cents per share.
Revenue, before paying for royalties and excluding revenue from energy trading, was $7.5 billion in the quarter, up from $3.98 billion in the fourth quarter of 2008.
Suncor attributes the increase to a jump in increased upstream production and refined product sales volumes resulting from the merger with Petro-Canada.
Suncor, known as a top oilsands operator, became the biggest energy company in Canada after its merger with former Crown corporation Petro-Canada in August.
In a statement released early Tuesday, the Calgary-based oil giant also gives credit to higher crude oil prices in this quarter compared to the year-ago period.
"We started the year confronting one of the most challenging global economic downturns of the past century, but today Suncor is a larger, stronger and more financially flexible company as we continue to realize some significant synergies following the merger with Petro-Canada," said Rick George, president and chief executive officer.
"We've made gains on achieving safe, reliable and cost-effective energy production across all our operations in 2009, which we intend to build on in 2010," George said in the statement.
Suncor's total upstream production during the fourth quarter of 2009 averaged 638,200 barrels of oil equivalent (boe) per day.
That includes additional production of 325,600 boe per day resulting from the merger.
The company's outlook for the current year inclues total production of 644,000 boe per day before targeted divestitures and not including its share of production from the Syncrude oilsands partnership.
About 75,000 bod/d of production is to be sold or otherwise divested, the Suncor said Tuesday.
In addition, it expects 38,000 barrels per day of production from Syncrude in 2010.
Suncor inherited a hodge podge of assets through the Petro-Canada deal, including refineries, a gas station chain, natural gas holdings, offshore production and overseas operations.
Since the merger, Suncor has been paring down parts of its portfolio that don't fit with its core oilsands business.
It aims to sell between $2 billion and $4 billion in assets. Those sales are expected to reduce Suncor's workforce by about 1,000 employees.
Shortly after the Petro-Canada deal closed, Suncor cut another 1,000 jobs, mostly at head office where positions between the two companies overlapped.
Last month Suncor sold natural gas operations in Colorado to Houston-based Noble Energy Inc. (NYSE:NBL) for US$494 million.
In addition to the U.S. production, Suncor has signalled its intention to shed some of its smaller North Sea holdings and Trinidad and Tobago operations.
The company has indicated big projects in Libya and Syria could be worth keeping, as would cash-flow generating offshore operations in Eastern Canada.
Late last year Suncor sold 98 of its retail gas stations to Husky Energy Inc. (TSX:HSE). Suncor was required to divest some of its downstream assets as one of the Competition Bureau's conditions for allowing the company to merge with Petro-Canada.
In the oilsands, Suncor is pressing ahead with Phase 3 of its Firebag project near Fort McMurray, Alta., but has said the fate of the Fort Hills project would be decided further out into the future.
A decision on Fort Hills, a proposed mining operation in which Petro-Canada used to be the lead partner, won't take place until late 2010 at the earliest.
Suncor has a 60 per cent stake in Fort Hills with Vancouver miner Teck Resources Ltd. (TSX:TCK.B) and oilsands junior UTS Energy Corp. (TSX:UTS) evenly splitting the remaining stake.

Organizations: Petro-Canada, TSX, Suncor Energy Inc. Thomson Reuters Noble Energy Inc. NYSE Husky Energy Inc. Competition Bureau Teck Resources UTS Energy

Geographic location: Eastern Canada, CALGARY, Colorado U.S. North Sea Trinidad and Tobago Libya Syria Firebag Fort McMurray Vancouver

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