Canadian Natural Resources reports 1st quarter profits and expansion of Horizon oilsands mine

Canadian Natural Resources Ltd. is reporting $245 million of net income for the first quarter, a big improvement from the loss it experienced at the same time last year but less than analysts expected.

The profit amounted to 22 cents per share for the Calgary-based oil and gas company.

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The company says it has approved another expansion of its Horizon oilsands mine but must revisit the scope of the project because of unexpectedly robust production from two previous expansions.

Horizon, which was designed with a maximum capacity of 182,000 barrels per day, is churning out 205,000 bpd of upgraded bitumen.

'A good problem to have'

Engineering work is taking place to determine how much more the plant can handle, CEO Steve Laut said Thursday on a conference call with analysts.

"Just to be clear though, this is a good problem to have," said Laut.

The expansion, expected to take place this summer during a maintenance shutdown, is intended to ease the bottleneck. The company has said the project could cost about $70 million and add between 5,000 and 15,000 bpd of capacity.

More production in the fall

Output from that expansion is anticipated to begin in the fall, the same time as new production would come from a separate $1-billion, 80,000-bpd expansion at Horizon.

Earlier Thursday, Canadian Natural said it had total oil and natural gas liquids production of almost 600,000 bpd in the first quarter ended March 31, slightly better than the 547,000 bpd in the same period a year ago.

Net income was $245 million, an improvement from a net loss of $105 million a year ago.

Revenue after royalty payments was $3.64 billion, up from $2.18 billion in the first quarter of 2016, as average realized oil prices more than doubled.

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