Canadian Natural Resources Limited Announces 2023 Third Quarter Results
Press Release
CALGARY, ALBERTA – NOVEMBER 2, 2023 – FOR IMMEDIATE RELEASE
Commenting on the Company’s third quarter 2023 results, Tim McKay, President, stated “Our quarterly results demonstrate how our effective and efficient operations, combined with our diverse product mix generates significant free cash flow, resulting in strong shareholder returns through our sustainable and growing dividend and significant share repurchases.
Our world class assets delivered top tier operational and financial results in Q3/23 with average quarterly production volumes of approximately 1,394,000 BOE/d, which is the highest quarterly volumes in the history of the Company, including record quarterly production volumes for both liquids and natural gas of approximately 1,035,000 bbl/d and 2,151 MMcf/d respectively. Following the completion of planned turnarounds at our Oil Sands Mining and Upgrading assets, synthetic crude oil (“SCO”) production was strong, averaging approximately 491,000 bbl/d during Q3/23, capturing robust SCO pricing at a premium to WTI. Additionally, as a result of strong execution in our thermal assets, production growth was ahead of plan, as Q3/23 average thermal production volumes increased by approximately 44,000 bbl/d to 287,000 bbl/d from Q3/22 levels. As a result of our focus on effective and efficient operations, the Company had strong liquid netbacks in Q3/23, similar to Q3/22 netback levels when commodity prices were much higher. This resulted in significant free cash flow for the Company.
Environmental, Social and Governance (“ESG”) remains a priority for the Company. Canadian Natural is an investment leader in research and development (“R&D”) and our strong track record of R&D investment will continue in 2024 and beyond and is targeted to grow with our participation in the Pathways Alliance. It is critical to work together with the Government of Canada and the Alberta government to make the Pathways Alliance a transformative industry collaboration. Through the foundational Carbon Capture and Storage (“CCS”) project, we have a significant opportunity to achieve meaningful GHG emissions reductions in support of industry’s, Alberta’s and Canada’s climate goals and to provide affordable, reliable, responsibly produced energy to the world.”
Canadian Natural’s Chief Financial Officer, Mark Stainthorpe, added “During the third quarter of 2023, our robust business model delivered strong net earnings of over $2.3 billion, adjusted net earnings of approximately $2.9 billion and strong quarterly adjusted funds flow of approximately $4.7 billion. After our base capital expenditures and dividend, the Company generated significant quarterly free cash flow of approximately $2.7 billion in Q3/23. Our diversified portfolio, including our long life low decline assets, combined with our effective and efficient operations allowed us to continue to deliver robust returns to shareholders by repurchasing shares and reducing debt. Year-to-date, up to and including November 1, 2023, we have returned approximately $6.1 billion to shareholders through dividends and share repurchases.
With current strong production volumes and expected free cash flow in Q4/23 and beyond, based on current strip pricing, we are quickly approaching a net debt level of $10 billion, which we forecast to achieve in Q1/24, at which time we target to increase returns to shareholders to 100% of free cash flow.
Subsequent to quarter end, the Board of Directors has approved an 11% increase to our base quarterly dividend to $1.00 per common share, from $0.90 per common share, demonstrating the confidence that the Board has in the sustainability of our business model, our strong balance sheet and the strength of our diverse, long life low decline reserves and asset base. With this increase announced today, the Company has increased its dividend by 18% in 2023 to $4.00 per share annually. As a result, the Company’s leading track record of dividend increases continues, as this increase will mark 2024 as the 24th consecutive year of dividend increases, with a CAGR of 21% over that time.”
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