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Suncor FMCA Presentation February 25, 2016 1 3/3/2016 Canadas - PowerPoint PPT Presentation

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3/3/2016 Suncor FMCA Presentation February 25, 2016 1 3/3/2016 Canadas largest integrated energy company Growing oil sands business with complementary upstream & downstream operations $63B enterprise value Dec 31, 2015 Fort

  1. 3/3/2016 Suncor – FMCA Presentation February 25, 2016 1

  2. 3/3/2016 Canada’s largest integrated energy company Growing oil sands business with complementary upstream & downstream operations $63B enterprise value Dec 31, 2015 Fort Hills* Oil Sands 578 mboe/d Firebag* 99% oil production St. John’s Edmonton Montreal East 2015 Actuals MacKay Syncrude Calgary Sarnia Coast River* 35 years 2P reserve life index Denver Mississauga Base Plant as at December 31, 2014 Hibernia & Mine* Terra Nova* 462 mb/d refining capacity Hebron Houston Fort White Rose McMurray North Sea Stavanger $6.8B cash flow from operations Golden Eagle Aberdeen 2015 Actuals Buzzard London $6.2B Head office capital expenditures Regional office 2015 Actuals excluding capitalized interest Upstream facility *operated $11B liquidity Downstream facility cash & cash equivalents ($4.0B) plus available credit facilities as at Dec. 31, 2015 Circles are scaled to relative net capacities in boe/d 2 2

  3. 3/3/2016 Oil sands portfolio Base Plant Syncrude 350,000 b/d capacity Syncrude operated Suncor working interest 100% 42,000 b/d capacity (SU WI) 1,766 mmbbls 2P reserves Suncor working interest 12% 525 mmbbls 2P reserves (SU WI) Firebag Fort Hills 203,000 b/d capacity Suncor operated Suncor working interest 100% 91,000 b/d capacity (planned, SU WI) 2,634 mmbbls 2P reserves Suncor working interest 50.8% 1,253 mmbbls 2P reserves (SU WI) Future opportunities MacKay River Lewis (SU WI 100%) 38,000 b/d capacity Meadow Creek (SU WI 75%) Suncor working interest 100% 542 mmbbls 2P reserves 3 3

  4. 3/3/2016 Oil Sands production up to 600 mb/d before the end of the decade Debottlenecks, expansions and growth projects expected to raise total Oil Sands production from 463 mb/d (2015) up to 600mb/d. Firebag • 23 mb/d debottleneck completed in Q4 2015 • Capacity 2 : 203 mb/d bitumen Base Mine Extraction • Extraction debottleneck complete • Notional 3 Capacity 2 : 325 to 350 mb/d bitumen Syncrude • 12% SU WI • Capacity 2 : 42 mb/d (SU WI) SCO MacKay River • 8 mb/d debottleneck reached in Q4 2015 • Capacity 2 : 38 mb/d bitumen Base Upgrading Operations • > 10 mb/d in potential reliability improvements • Capacity 2 : 350 mb/d SCO • 22% shrinkage factor SCO, diesel and bitumen Logistics to market Fort Hills Future growth projects will be integrated with existing • Increased SU WI to 50.8% logistics infrastructure • Under construction • Capacity 2 : 91 mb/d (SU WI) PFT bitumen 4 4

  5. 3/3/2016 Market access strategy for inland oil production Suncor has over 600 mb/d of near-term access to globally priced markets Upgrader Current 1 Diesel • Existing pipelines Edmonton and hubs • 80+ mb/d rail loading and offloading Montreal • Suncor Refinery • Marine opportunities for inland oil • Line 9 to Montreal Sarnia Denver 5 5

  6. 3/3/2016 Oil price volatility Brent crude oil price: History of volatility Financial 120 crisis 100 80 9/11 US$/bbl OPEC Market 60 Share Asian financial Gulf War 1 40 crisis OPEC Market 20 Share 0 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 * 6 * Source EIA 6

  7. 3/3/2016 Disciplined capital and operating cost management Suncor Oil Sands Capex & cash flow from operations P rices and cash operating costs C$ billions C$/bbl 100 Oil Sands Average 3 CFOPs 1 Sales Price 9.7 9.7 9.4 9.1 75 Capital Expenditures 2 6.8 50 6.5 6.4 6.4 6.3 6.2 Cash Operating Costs 1 per barrel 39.05 39.05 37.05 37.00 37.05 37.00 33.80 33.80 25 28.20 27.85 0 2011 2012 2013 2014 2015 2013 2011 2012 2014 2015 7 7

  8. 3/3/2016 Oil Sands Cost Structure Per Barrel – End of 2015 45 40 35 Royalties 30 Reclamation 25 20 Capital Expenses 15 10 Operating Expenses 5 0 8 8

  9. 3/3/2016 Municipal Costs Municipal taxes have increased yearly for industry exacerbating the erosion of industry competitiveness 9 9

  10. 3/3/2016 Firebag Debottle Update Cost effective debottleneck supported 23 kbpd plant capacity expansion 203 mb/d Scope Firebag plant capacity rerate • debottleneck of produced water cooling facilities • rerate of de-oiling and steam generation units <$5k /bbl debottleneck cost • reduced field wide SOR 3 Years • infill wells continue to outperform acceleration of debottleneck Forward sustaining capital requirement 2.8 current field wide SOR • sub-surface: alignment of well pad development timing with increased nameplate capacity 95% • surface: facility investment planned near 2020 to expected plant reliability maintain production capacity at increasing SORs Repurpose of Voyageur equipment Firebag debottleneck - Produced water cooling unit 10 10

  11. 3/3/2016 2016 Spring Planned Maintenance Key dates • Pre-execution: February 1 – March 25 • Execution: March 31 – May 17 • Post-execution: May 18 – July 31 Scope of work Core Upgrader 2 assets • Regulatory/inspections, catalyst renewal/ regeneration, necessary reliability repairs, and critical project scope Workforce size • ~2,500 general and specialty contractors, and maintenance support Production impact • 250,000 barrels per day 11 11

  12. 3/3/2016 Fort Hills Development Update 50.8% Suncor working interest additional 10% working interest as at November 2015 91 mb/d production capacity net to Suncor 96% engineering complete as at December 31, 2015 construction complete 51% as at December 31, 2015 $6.5B capital cost estimate net to Suncor from project sanction to first oil 21M+ construction hours without environmental or regulatory enforcement action 12 12

  13. 3/3/2016 Suncor’s proposed acquisition of Canadian Oil Sands Limited The Offer COS board supported offer of 0.28 SU shares per COS share . The transaction was valued at $6.6 B at the time of agreement. Financial 19% net debt to capitalization on a pro-forma basis as at September 30, 2015. Suncor to issue ~136 M shares assuming 100% of COS shares are acquired. Operating Suncor would increase it’s working interest in Syncrude (capacity 350 mb/d SCO) from 12% to 48.74% . 20% increase in 2P reserves to 9.1 billion barrels. Synergies Explore regional synergies and efficiencies with respect to operations, capital investment and technology 13 13

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