Published in the Calgary Herald on November 13, 2009 

CALGARY - Suncor Energy Inc. on Friday dusted off the Firebag oilsands project and outlined a $5.5 billion capital budget for 2010.

Approximately $1.5 billion will be directed toward growth projects while $4 billion is targeted to sustaining existing operations, the company said in a news release. Suncor said improvements in the financial environment prompted the company to open the funding taps but it remains cautious.

“While we’ve seen some improvement in crude oil prices and the overall economy, we believe that a conservative capital strategy remains the best approach for Suncor,” said CEO Rick George. “We’re looking at a level of capital investment that is supportable entirely from free cash flow at mid-cycle crude oil prices.”

The majority of growth spending will be directed toward the third phase of the Firebag in-situ oilsands expansion, which was approximately 50 per cent complete before it was deferred in early 2009.

Suncor now expects Firebag to begin production in the middle 2011. Suncor will also kick start Firebag Stage 4 to begin production in the fourth quarter of 2012. Both projects will produce a combined 136,000 barrels per day when complete.

“We’ve said that sequencing of our growth projects would be based on highest expected return on capital, near-term cash flow and lowest risk,” said George. “Expansion work at Firebag clearly fits all the criteria to be first out of the gate.”

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