UPDATE: Canadian Natural Resources Shutters Horizon Plant, Cuts 2012 Production: Shares Lower Today But Not Hammered
Canadian Natural Resources Ltd. (CNQ.TO) has shut down its Horizon oil sands plant and cut its 2012 production estimate for the project after realizing recent damage to the facility is more extensive than its original assessment.
In a statement, the company shaved about 11% off its production guidance from Horizon on Monday and said full production will not resume until the middle or end of March. CNQ had previously expected to resume production later this month. The problem occurred in Horizon's primary upgrading facility, which was hit by a fire last January and under repairs until August.
The price of oil rallied and CNR's stock dropped when news of its production problems became public over a week ago. At the time, the oil and gas company said Horizon's troubles would not dent its production target, Reuters noted.
CNQ expects Horizon to produce between 93,000 and 103,000 barrels of synthetic oil per day in 2012, down from its previous guidance of between 105,000 and 115,000 barrels of synthetic oil per day, Reuters said. The company said its "fractionating unit" in the upgrading facility is the problem, but provided no further details. The fractionating unit is part of the upgrading facility, it added.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.