β
βExhibit 99.2β
Consolidated Statements of Comprehensive Income
(unaudited)β
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Revenues and Other Income | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Operating revenues, net of royalties (noteΒ 3) | β | β | β | β | 16β135 | β | β | β | β | β | 9β159 | β | β | β | β | β | 29β472 | β | β | β | β | β | 17β838 | β | β |
β | ||||||||||||||||||||||||||
β | Other income (loss) (noteΒ 4) | β | β | β | β | 69 | β | β | β | β | β | (66) | β | β | β | β | β | 83 | β | β | β | β | β | (109) | β | β |
β | β | β | β | β | β | 16β204 | β | β | β | β | β | 9β093 | β | β | β | β | β | 29β555 | β | β | β | β | β | 17β729 | β | β |
β | Expenses | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Purchases of crude oil and products | β | β | β | β | 5β684 | β | β | β | β | β | 3β247 | β | β | β | β | β | 10β036 | β | β | β | β | β | 5β830 | β | β |
β | ||||||||||||||||||||||||||
β | Operating, selling and general | β | β | β | β | 3β088 | β | β | β | β | β | 2β720 | β | β | β | β | β | 6β176 | β | β | β | β | β | 5β620 | β | β |
β | ||||||||||||||||||||||||||
β | Transportation and distribution | β | β | β | β | 391 | β | β | β | β | β | 350 | β | β | β | β | β | 761 | β | β | β | β | β | 731 | β | β |
β | ||||||||||||||||||||||||||
β | Depreciation, depletion, amortization and impairment | β | β | β | β | 998 | β | β | β | β | β | 1β512 | β | β | β | β | β | 2β469 | β | β | β | β | β | 3β002 | β | β |
β | ||||||||||||||||||||||||||
β | Exploration | β | β | β | β | 6 | β | β | β | β | β | 12 | β | β | β | β | β | 45 | β | β | β | β | β | 20 | β | β |
β | ||||||||||||||||||||||||||
β | Gain on disposal of assets | β | β | β | β | (10) | β | β | β | β | β | (8) | β | β | β | β | β | (12) | β | β | β | β | β | (16) | β | β |
β | ||||||||||||||||||||||||||
β | Financing expenses (noteΒ 6) | β | β | β | β | 638 | β | β | β | β | β | 172 | β | β | β | β | β | 823 | β | β | β | β | β | 340 | β | β |
β | β | β | β | β | β | 10β795 | β | β | β | β | β | 8β005 | β | β | β | β | β | 20β298 | β | β | β | β | β | 15β527 | β | β |
β | Earnings before Income Taxes | β | β | β | β | 5β409 | β | β | β | β | β | 1β088 | β | β | β | β | β | 9β257 | β | β | β | β | β | 2β202 | β | β |
β | Income Tax Expense (Recovery) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Current | β | β | β | β | 1β452 | β | β | β | β | β | 228 | β | β | β | β | β | 2β428 | β | β | β | β | β | 512 | β | β |
β | ||||||||||||||||||||||||||
β | Deferred | β | β | β | β | (39) | β | β | β | β | β | (8) | β | β | β | β | β | (116) | β | β | β | β | β | 1 | β | β |
β | β | β | β | β | β | 1β413 | β | β | β | β | β | 220 | β | β | β | β | β | 2β312 | β | β | β | β | β | 513 | β | β |
β | Net Earnings | β | β | β | β | 3β996 | β | β | β | β | β | 868 | β | β | β | β | β | 6β945 | β | β | β | β | β | 1β689 | β | β |
β | Other Comprehensive Income (Loss) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | ItemsΒ That May be Subsequently Reclassified to Earnings: | β | β | β | β | β | β | β | β | β | β | β | β | β | ||||||||||||
β | ||||||||||||||||||||||||||
β | Foreign currency translation adjustment | β | β | β | β | (14) | β | β | β | β | β | (55) | β | β | β | β | β | (70) | β | β | β | β | β | (96) | β | β |
β | ||||||||||||||||||||||||||
β | ItemsΒ That Will Not be Reclassified to Earnings: | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Actuarial gain on employee retirement benefit plans, net of income taxes (noteΒ 12) | β | β | β | β | 506 | β | β | β | β | β | 2 | β | β | β | β | β | 898 | β | β | β | β | β | 658 | β | β |
β | Other Comprehensive Income (Loss) | β | β | β | β | 492 | β | β | β | β | β | (53) | β | β | β | β | β | 828 | β | β | β | β | β | 562 | β | β |
β | Total Comprehensive Income | β | β | β | β | 4β488 | β | β | β | β | β | 815 | β | β | β | β | β | 7β773 | β | β | β | β | β | 2β251 | β | β |
β | Per Common Share (dollars) (noteΒ 7) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Net earningsβββbasic | β | β | β | β | 2.84 | β | β | β | β | β | 0.58 | β | β | β | β | β | 4.89 | β | β | β | β | β | 1.12 | β | β |
β | ||||||||||||||||||||||||||
β | Net earningsβββdiluted | β | β | β | β | 2.83 | β | β | β | β | β | 0.58 | β | β | β | β | β | 4.88 | β | β | β | β | β | 1.12 | β | β |
β | ||||||||||||||||||||||||||
β | Cash dividends | β | β | β | β | 0.47 | β | β | β | β | β | 0.21 | β | β | β | β | β | 0.89 | β | β | β | β | β | 0.42 | β | β |
See accompanying notes to the condensed interim consolidated financial statements.β
52Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
Consolidated Balance Sheets
(unaudited)β
β | ($ millions) | β | β | JuneΒ 30 2022 | β | β | DecemberΒ 31 2021 | β | ||||||
β | Assets | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||
β | Current assets | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||
β | Cash and cash equivalents | β | β | β | β | 1β670 | β | β | β | β | β | 2β205 | β | β |
β | ||||||||||||||
β | Accounts receivable | β | β | β | β | 8β074 | β | β | β | β | β | 4β534 | β | β |
β | ||||||||||||||
β | Inventories | β | β | β | β | 5β774 | β | β | β | β | β | 4β110 | β | β |
β | ||||||||||||||
β | Income taxes receivable | β | β | β | β | 180 | β | β | β | β | β | 128 | β | β |
β | ||||||||||||||
β | Assets held for sale (noteΒ 13) | β | β | β | β | 860 | β | β | β | β | β | β | β | β |
β | Total current assets | β | β | β | β | 16β558 | β | β | β | β | β | 10β977 | β | β |
β | ||||||||||||||
β | Property, plant and equipment, net | β | β | β | β | 62β338 | β | β | β | β | β | 65β546 | β | β |
β | ||||||||||||||
β | Exploration and evaluation | β | β | β | β | 2β240 | β | β | β | β | β | 2β226 | β | β |
β | ||||||||||||||
β | Other assets | β | β | β | β | 1β633 | β | β | β | β | β | 1β307 | β | β |
β | ||||||||||||||
β | Goodwill and other intangible assets | β | β | β | β | 3β527 | β | β | β | β | β | 3β523 | β | β |
β | ||||||||||||||
β | Deferred income taxes | β | β | β | β | 61 | β | β | β | β | β | 160 | β | β |
β | Total assets | β | β | β | β | 86β357 | β | β | β | β | β | 83β739 | β | β |
β | Liabilities and Shareholdersβ Equity | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||
β | Current liabilities | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||
β | Short-term debt | β | β | β | β | 1β581 | β | β | β | β | β | 1β284 | β | β |
β | ||||||||||||||
β | Current portion of long-term debt (noteΒ 6) | β | β | β | β | β | β | β | β | β | β | 231 | β | β |
β | ||||||||||||||
β | Current portion of long-term lease liabilities | β | β | β | β | 302 | β | β | β | β | β | 310 | β | β |
β | ||||||||||||||
β | Accounts payable and accrued liabilities | β | β | β | β | 9β729 | β | β | β | β | β | 6β503 | β | β |
β | ||||||||||||||
β | Current portion of provisions | β | β | β | β | 767 | β | β | β | β | β | 779 | β | β |
β | ||||||||||||||
β | Income taxes payable | β | β | β | β | 1β949 | β | β | β | β | β | 1β292 | β | β |
β | ||||||||||||||
β | Liabilities associated with assets held for sale (noteΒ 13) | β | β | β | β | 220 | β | β | β | β | β | β | β | β |
β | Total current liabilities | β | β | β | β | 14β548 | β | β | β | β | β | 10β399 | β | β |
β | ||||||||||||||
β | Long-term debt (noteΒ 6) | β | β | β | β | 12β880 | β | β | β | β | β | 13β989 | β | β |
β | ||||||||||||||
β | Long-term lease liabilities | β | β | β | β | 2β606 | β | β | β | β | β | 2β540 | β | β |
β | ||||||||||||||
β | Other long-term liabilities (noteΒ 12) | β | β | β | β | 1β184 | β | β | β | β | β | 2β180 | β | β |
β | ||||||||||||||
β | Provisions (noteΒ 11) | β | β | β | β | 6β075 | β | β | β | β | β | 8β776 | β | β |
β | ||||||||||||||
β | Deferred income taxes | β | β | β | β | 9β299 | β | β | β | β | β | 9β241 | β | β |
β | ||||||||||||||
β | Equity | β | β | β | β | 39β765 | β | β | β | β | β | 36β614 | β | β |
β | Total liabilities and shareholdersβ equity | β | β | β | β | 86β357 | β | β | β | β | β | 83β739 | β | β |
See accompanying notes to the condensed interim consolidated financial statements.β
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 53
β
Β
Consolidated Statements of Cash Flows
(unaudited)β
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Operating Activities | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Net Earnings | β | β | β | β | 3β996 | β | β | β | β | β | 868 | β | β | β | β | β | 6β945 | β | β | β | β | β | 1β689 | β | β |
β | ||||||||||||||||||||||||||
β | Adjustments for: | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Depreciation, depletion, amortization and impairment | β | β | β | β | 998 | β | β | β | β | β | 1β512 | β | β | β | β | β | 2β469 | β | β | β | β | β | 3β002 | β | β |
β | ||||||||||||||||||||||||||
β | Deferred income tax (recovery) expense | β | β | β | β | (39) | β | β | β | β | β | (8) | β | β | β | β | β | (116) | β | β | β | β | β | 1 | β | β |
β | ||||||||||||||||||||||||||
β | Accretion (noteΒ 6) | β | β | β | β | 76 | β | β | β | β | β | 77 | β | β | β | β | β | 154 | β | β | β | β | β | 151 | β | β |
β | ||||||||||||||||||||||||||
β | Unrealized foreign exchange loss (gain) on U.S. dollar denominated debt (noteΒ 6) | β | β | β | β | 352 | β | β | β | β | β | (174) | β | β | β | β | β | 206 | β | β | β | β | β | (370) | β | β |
β | ||||||||||||||||||||||||||
β | Change in fair value of financial instruments and trading inventory | β | β | β | β | (133) | β | β | β | β | β | (12) | β | β | β | β | β | (207) | β | β | β | β | β | (115) | β | β |
β | ||||||||||||||||||||||||||
β | Gain on disposal of assets | β | β | β | β | (10) | β | β | β | β | β | (8) | β | β | β | β | β | (12) | β | β | β | β | β | (16) | β | β |
β | ||||||||||||||||||||||||||
β | Share-based compensation | β | β | β | β | 134 | β | β | β | β | β | 81 | β | β | β | β | β | 190 | β | β | β | β | β | 79 | β | β |
β | ||||||||||||||||||||||||||
β | Settlement of decommissioning and restoration liabilities | β | β | β | β | (80) | β | β | β | β | β | (43) | β | β | β | β | β | (171) | β | β | β | β | β | (113) | β | β |
β | ||||||||||||||||||||||||||
β | Other | β | β | β | β | 51 | β | β | β | β | β | 69 | β | β | β | β | β | (19) | β | β | β | β | β | 164 | β | β |
β | ||||||||||||||||||||||||||
β | Increase in non-cash working capital | β | β | β | β | (1β110) | β | β | β | β | β | (276) | β | β | β | β | β | (2β132) | β | β | β | β | β | (41) | β | β |
β | Cash flow provided by operating activities | β | β | β | β | 4β235 | β | β | β | β | β | 2β086 | β | β | β | β | β | 7β307 | β | β | β | β | β | 4β431 | β | β |
β | Investing Activities | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Capital and exploration expenditures | β | β | β | β | (1β295) | β | β | β | β | β | (1β347) | β | β | β | β | β | (2β306) | β | β | β | β | β | (2β150) | β | β |
β | ||||||||||||||||||||||||||
β | Capital expenditures on assets held for sale | β | β | β | β | (36) | β | β | β | β | β | β | β | β | β | β | β | (55) | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Proceeds from disposal of assets | β | β | β | β | 16 | β | β | β | β | β | 2 | β | β | β | β | β | 18 | β | β | β | β | β | 10 | β | β |
β | ||||||||||||||||||||||||||
β | Other investments and acquisitions (noteΒ 10) | β | β | β | β | 38 | β | β | β | β | β | (9) | β | β | β | β | β | 24 | β | β | β | β | β | (16) | β | β |
β | ||||||||||||||||||||||||||
β | Decrease in non-cash working capital | β | β | β | β | 97 | β | β | β | β | β | 221 | β | β | β | β | β | 66 | β | β | β | β | β | 187 | β | β |
β | Cash flow used in investing activities | β | β | β | β | (1β180) | β | β | β | β | β | (1β133) | β | β | β | β | β | (2β253) | β | β | β | β | β | (1β969) | β | β |
β | Financing Activities | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Net increase (decrease) in short-term debt | β | β | β | β | 198 | β | β | β | β | β | 365 | β | β | β | β | β | 269 | β | β | β | β | β | (906) | β | β |
β | ||||||||||||||||||||||||||
β | Repayment of long-term debt (noteΒ 6) | β | β | β | β | (1β306) | β | β | β | β | β | β | β | β | β | β | β | (1β539) | β | β | β | β | β | (1β050) | β | β |
β | ||||||||||||||||||||||||||
β | Issuance of long-term debt | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 1β423 | β | β |
β | ||||||||||||||||||||||||||
β | Lease liability payments | β | β | β | β | (83) | β | β | β | β | β | (80) | β | β | β | β | β | (167) | β | β | β | β | β | (168) | β | β |
β | ||||||||||||||||||||||||||
β | Issuance of common shares under share option plans | β | β | β | β | 371 | β | β | β | β | β | 3 | β | β | β | β | β | 450 | β | β | β | β | β | 3 | β | β |
β | ||||||||||||||||||||||||||
β | Repurchase of common shares (noteΒ 8) | β | β | β | β | (2β553) | β | β | β | β | β | (643) | β | β | β | β | β | (3β380) | β | β | β | β | β | (961) | β | β |
β | ||||||||||||||||||||||||||
β | Distributions relating to non-controlling interest | β | β | β | β | (2) | β | β | β | β | β | (3) | β | β | β | β | β | (4) | β | β | β | β | β | (5) | β | β |
β | ||||||||||||||||||||||||||
β | Dividends paid on common shares | β | β | β | β | (657) | β | β | β | β | β | (315) | β | β | β | β | β | (1β258) | β | β | β | β | β | (634) | β | β |
β | Cash flow used in financing activities | β | β | β | β | (4β032) | β | β | β | β | β | (673) | β | β | β | β | β | (5β629) | β | β | β | β | β | (2β298) | β | β |
β | (Decrease) Increase in Cash and Cash Equivalents | β | β | β | β | (977) | β | β | β | β | β | 280 | β | β | β | β | β | (575) | β | β | β | β | β | 164 | β | β |
β | ||||||||||||||||||||||||||
β | Effect of foreign exchange on cash and cash equivalents | β | β | β | β | 48 | β | β | β | β | β | (7) | β | β | β | β | β | 40 | β | β | β | β | β | (14) | β | β |
β | ||||||||||||||||||||||||||
β | Cash and cash equivalents at beginning of period | β | β | β | β | 2β599 | β | β | β | β | β | 1β762 | β | β | β | β | β | 2β205 | β | β | β | β | β | 1β885 | β | β |
β | Cash and Cash Equivalents at End of Period | β | β | β | β | 1β670 | β | β | β | β | β | 2β035 | β | β | β | β | β | 1β670 | β | β | β | β | β | 2β035 | β | β |
β | Supplementary Cash Flow Information | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Interest paid | β | β | β | β | 329 | β | β | β | β | β | 353 | β | β | β | β | β | 470 | β | β | β | β | β | 492 | β | β |
β | ||||||||||||||||||||||||||
β | Income taxes paid (received) | β | β | β | β | 670 | β | β | β | β | β | (230) | β | β | β | β | β | 1β762 | β | β | β | β | β | (82) | β | β |
See accompanying notes to the condensed interim consolidated financial statements.β
54Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
Consolidated Statements of Changes in Equity
(unaudited)β
β | ($ millions) | β | β | Share Capital | β | β | Contributed Surplus | β | β | Accumulated Other Comprehensive Income | β | β | Retained Earnings | β | β | Total | β | β | β | Number of Common Shares (thousands) | β | ||||||||||||||||||
β | At DecemberΒ 31, 2020 | β | β | β | β | 25β144 | β | β | β | β | β | 591 | β | β | β | β | β | 877 | β | β | β | β | β | 9β145 | β | β | β | β | β | 35β757 | β | β | β | β | β | β | 1β525β151 | β | β |
β | Net earnings | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 1β689 | β | β | β | β | β | 1β689 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Foreign currency translation adjustment | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (96) | β | β | β | β | β | β | β | β | β | β | β | (96) | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Actuarial gain on employee retirement benefit plans, net of income taxes ofβ $208 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 658 | β | β | β | β | β | 658 | β | β | β | β | β | β | β | β | β |
β | Total comprehensive (loss) income | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (96) | β | β | β | β | β | 2β347 | β | β | β | β | β | 2β251 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Issued under share option plans | β | β | β | β | 3 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 3 | β | β | β | β | β | β | 100 | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Repurchase of common shares for cancellation (noteΒ 8) | β | β | β | β | (576) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (385) | β | β | β | β | β | (961) | β | β | β | β | β | β | (34β989) | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Change in liability for share repurchase commitment | β | β | β | β | (122) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (98) | β | β | β | β | β | (220) | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Share-based compensation | β | β | β | β | β | β | β | β | β | β | 13 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 13 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Dividends paid on common shares | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (634) | β | β | β | β | β | (634) | β | β | β | β | β | β | β | β | β |
β | At JuneΒ 30, 2021 | β | β | β | β | 24β449 | β | β | β | β | β | 604 | β | β | β | β | β | 781 | β | β | β | β | β | 10β375 | β | β | β | β | β | 36β209 | β | β | β | β | β | β | 1β490β262 | β | β |
β | At DecemberΒ 31, 2021 | β | β | β | β | 23β650 | β | β | β | β | β | 612 | β | β | β | β | β | 814 | β | β | β | β | β | 11β538 | β | β | β | β | β | 36β614 | β | β | β | β | β | β | 1β441β251 | β | β |
β | Net earnings | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 6β945 | β | β | β | β | β | 6β945 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Foreign currency translation adjustment | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (70) | β | β | β | β | β | β | β | β | β | β | β | (70) | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Actuarial gain on employee retirement benefit plans, net of income taxes ofβ $283 (noteΒ 12) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 898 | β | β | β | β | β | 898 | β | β | β | β | β | β | β | β | β |
β | Total comprehensive (loss) income | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (70) | β | β | β | β | β | 7β843 | β | β | β | β | β | 7β773 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Issued under share option plans | β | β | β | β | 518 | β | β | β | β | β | (68) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 450 | β | β | β | β | β | β | 11β919 | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Common shares forfeited | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (30) | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Repurchase of common shares for cancellation (noteΒ 8) | β | β | β | β | (1β249) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (2β131) | β | β | β | β | β | (3β380) | β | β | β | β | β | β | (75β212) | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Change in liability for share repurchase commitment (noteΒ 8) | β | β | β | β | (131) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (314) | β | β | β | β | β | (445) | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Share-based compensation | β | β | β | β | β | β | β | β | β | β | 11 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 11 | β | β | β | β | β | β | β | β | β |
β | |||||||||||||||||||||||||||||||||||||||
β | Dividends paid on common shares | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (1β258) | β | β | β | β | β | (1β258) | β | β | β | β | β | β | β | β | β |
β | At JuneΒ 30, 2022 | β | β | β | β | 22β788 | β | β | β | β | β | 555 | β | β | β | β | β | 744 | β | β | β | β | β | 15β678 | β | β | β | β | β | 39β765 | β | β | β | β | β | β | 1β377β928 | β | β |
See accompanying notes to the condensed interim consolidated financial statements.
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 55
β
Notes to the Consolidated Financial Statements
(unaudited)
1. Reporting Entity and Description of the Business
Suncor EnergyΒ Inc. (Suncor or the company) is an integrated energy company headquartered in Calgary, Alberta. Suncorβs operations include oil sands development, production and upgrading; offshore oil and gas; petroleum refining in Canada and the U.S.; and the companyβs Petro-Canada retail and wholesale distribution networks (including Canadaβs Electric HighwayTM, a coast-to-coast network of fast-charging electric vehicle stations). Suncor is developing petroleum resources while advancing the transition to a low-emissions future through investment in power, renewable fuels and hydrogen. Suncor also conducts energy trading activities focused principally on the marketing and trading of crude oil, natural gas, byproducts, refined products and power. Suncor has been recognized for its performance and transparent reporting on the Dow Jones Sustainability index, FTSE4Good and CDP. Suncor is also listed on the UN Global Compact 100 stock index. Suncorβs common shares (symbol: SU) are listed on the Toronto Stock Exchange (TSX) and New York Stock Exchange (NYSE).
The address of the companyβs registered office is 150βββ6th Avenue S.W., Calgary, Alberta, Canada, T2P 3E3.
2. Basis of Preparation
(a) Statement of Compliance
These condensed interim consolidated financial statements have been prepared in accordance with International Financial Reporting Standards, specifically International Accounting StandardΒ 34 Interim Financial Reporting as issued by the International Accounting Standards Board. They are condensed as they do not include all of the information required for full annual financial statements, and they should be read in conjunction with the audited consolidated financial statements of the company for the year ended DecemberΒ 31, 2021.
(b) Basis of Measurement
The consolidated financial statements are prepared on a historical cost basis except as detailed in the accounting policies disclosed in the companyβs audited consolidated financial statements for the year ended DecemberΒ 31, 2021.
(c) Functional Currency and Presentation Currency
These consolidated financial statements are presented in Canadian dollars, which is the companyβs functional currency.
(d) Use of Estimates, Assumptions and Judgments
The timely preparation of financial statements requires that management make estimates and assumptions and use judgment. Accordingly, actual results may differ from estimated amounts as future confirming events occur. Significant estimates and judgment used in the preparation of the financial statements are described in the companyβs audited consolidated financial statements for the year ended DecemberΒ 31, 2021.
(e) Income Taxes
The company recognizes the impacts of income tax rate changes in earnings in the period that the applicable rate change is enacted or substantively enacted.
56Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
3. Segmented Information
The companyβs operating segments are reported based on the nature of their products and services and management responsibility.
Intersegment sales of crude oil and natural gas are accounted for at market values and are included, for segmented reporting, in revenues of the segment making the transfer and expenses of the segment receiving the transfer. Intersegment amounts are eliminated on consolidation. Beginning in the first quarter of 2022, to align with how management evaluates segment performance, the company revised its segment presentation to reflect segment results before income tax expense and present tax at a consolidated level. This presentation change has no effect on consolidated net earnings and comparative periods have been restated to reflect this change.
β | ThreeΒ months ended JuneΒ 30 | β | β | Oil Sands | β | β | Exploration and Production | β | β | Refining and Marketing | β | β | Corporate and Eliminations | β | β | Total | β | |||||||||||||||||||||||||||||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||||||||||||||||||||
β | Revenues and Other Income | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Gross revenues | β | β | β | β | 6β388 | β | β | β | β | β | 3β766 | β | β | β | β | β | 1β219 | β | β | β | β | β | 906 | β | β | β | β | β | 10β194 | β | β | β | β | β | 4β916 | β | β | β | β | β | 14 | β | β | β | β | β | 9 | β | β | β | β | β | 17β815 | β | β | β | β | β | 9β597 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Intersegment revenues | β | β | β | β | 2β374 | β | β | β | β | β | 870 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 45 | β | β | β | β | β | 22 | β | β | β | β | β | (2β419) | β | β | β | β | β | (892) | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Less: Royalties | β | β | β | β | (1β487) | β | β | β | β | β | (220) | β | β | β | β | β | (193) | β | β | β | β | β | (218) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (1β680) | β | β | β | β | β | (438) | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Operating revenues, net of royalties | β | β | β | β | 7β275 | β | β | β | β | β | 4β416 | β | β | β | β | β | 1β026 | β | β | β | β | β | 688 | β | β | β | β | β | 10β239 | β | β | β | β | β | 4β938 | β | β | β | β | β | (2β405) | β | β | β | β | β | (883) | β | β | β | β | β | 16β135 | β | β | β | β | β | 9β159 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Other income (loss) | β | β | β | β | 16 | β | β | β | β | β | (79) | β | β | β | β | β | 12 | β | β | β | β | β | 11 | β | β | β | β | β | 35 | β | β | β | β | β | 6 | β | β | β | β | β | 6 | β | β | β | β | β | (4) | β | β | β | β | β | 69 | β | β | β | β | β | (66) | β | β |
β | β | β | β | β | β | 7β291 | β | β | β | β | β | 4β337 | β | β | β | β | β | 1β038 | β | β | β | β | β | 699 | β | β | β | β | β | 10β274 | β | β | β | β | β | 4β944 | β | β | β | β | β | (2β399) | β | β | β | β | β | (887) | β | β | β | β | β | 16β204 | β | β | β | β | β | 9β093 | β | β |
β | Expenses | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Purchases of crude oil and products | β | β | β | β | 561 | β | β | β | β | β | 345 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 7β385 | β | β | β | β | β | 3β712 | β | β | β | β | β | (2β262) | β | β | β | β | β | (810) | β | β | β | β | β | 5β684 | β | β | β | β | β | 3β247 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Operating, selling and general | β | β | β | β | 2β169 | β | β | β | β | β | 1β945 | β | β | β | β | β | 131 | β | β | β | β | β | 122 | β | β | β | β | β | 592 | β | β | β | β | β | 472 | β | β | β | β | β | 196 | β | β | β | β | β | 181 | β | β | β | β | β | 3β088 | β | β | β | β | β | 2β720 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Transportation and distribution | β | β | β | β | 287 | β | β | β | β | β | 280 | β | β | β | β | β | 25 | β | β | β | β | β | 20 | β | β | β | β | β | 87 | β | β | β | β | β | 60 | β | β | β | β | β | (8) | β | β | β | β | β | (10) | β | β | β | β | β | 391 | β | β | β | β | β | 350 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Depreciation, depletion, amortization and impairment | β | β | β | β | 1β279 | β | β | β | β | β | 1β092 | β | β | β | β | β | (505) | β | β | β | β | β | 191 | β | β | β | β | β | 199 | β | β | β | β | β | 208 | β | β | β | β | β | 25 | β | β | β | β | β | 21 | β | β | β | β | β | 998 | β | β | β | β | β | 1β512 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Exploration | β | β | β | β | 2 | β | β | β | β | β | 3 | β | β | β | β | β | 4 | β | β | β | β | β | 9 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 6 | β | β | β | β | β | 12 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Loss (gain) on disposal of assets | β | β | β | β | 1 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (11) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (8) | β | β | β | β | β | (10) | β | β | β | β | β | (8) | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Financing expenses | β | β | β | β | 100 | β | β | β | β | β | 90 | β | β | β | β | β | 22 | β | β | β | β | β | 17 | β | β | β | β | β | 15 | β | β | β | β | β | 6 | β | β | β | β | β | 501 | β | β | β | β | β | 59 | β | β | β | β | β | 638 | β | β | β | β | β | 172 | β | β |
β | β | β | β | β | β | 4β399 | β | β | β | β | β | 3β755 | β | β | β | β | β | (323) | β | β | β | β | β | 359 | β | β | β | β | β | 8β267 | β | β | β | β | β | 4β458 | β | β | β | β | β | (1β548) | β | β | β | β | β | (567) | β | β | β | β | β | 10β795 | β | β | β | β | β | 8β005 | β | β |
β | Earnings (Loss) before Income Taxes | β | β | β | β | 2β892 | β | β | β | β | β | 582 | β | β | β | β | β | 1β361 | β | β | β | β | β | 340 | β | β | β | β | β | 2β007 | β | β | β | β | β | 486 | β | β | β | β | β | (851) | β | β | β | β | β | (320) | β | β | β | β | β | 5β409 | β | β | β | β | β | 1β088 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Income Tax Expense (Recovery) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Current | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 1β452 | β | β | β | β | β | 228 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Deferred | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (39) | β | β | β | β | β | (8) | β | β |
β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 1β413 | β | β | β | β | β | 220 | β | β |
β | Net Earnings | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 3β996 | β | β | β | β | β | 868 | β | β |
β | Capital and Exploration Expenditures(1) | β | β | β | β | 905 | β | β | β | β | β | 834 | β | β | β | β | β | 115 | β | β | β | β | β | 64 | β | β | β | β | β | 261 | β | β | β | β | β | 375 | β | β | β | β | β | 14 | β | β | β | β | β | 74 | β | β | β | β | β | 1β295 | β | β | β | β | β | 1β347 | β | β |
β
(1)
Excludes capital expenditures related to assets held for sale ofβ $36Β million for the threeΒ months ended JuneΒ 30, 2022.
β
β
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 57
β
Notes to the Consolidated Financial Statements
β | SixΒ months ended JuneΒ 30 | β | β | Oil Sands | β | β | Exploration and Production | β | β | Refining and Marketing | β | β | Corporate and Eliminations | β | β | Total | β | |||||||||||||||||||||||||||||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||||||||||||||||||||
β | Revenues and Other Income | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Gross revenues(1) | β | β | β | β | 12β010 | β | β | β | β | β | 7β061 | β | β | β | β | β | 2β234 | β | β | β | β | β | 1β496 | β | β | β | β | β | 18β017 | β | β | β | β | β | 9β906 | β | β | β | β | β | 23 | β | β | β | β | β | 15 | β | β | β | β | β | 32β284 | β | β | β | β | β | 18β478 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Intersegment revenues(1) | β | β | β | β | 4β222 | β | β | β | β | β | 1β926 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 77 | β | β | β | β | β | 45 | β | β | β | β | β | (4β299) | β | β | β | β | β | (1β971) | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Less: Royalties | β | β | β | β | (2β472) | β | β | β | β | β | (378) | β | β | β | β | β | (340) | β | β | β | β | β | (262) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (2β812) | β | β | β | β | β | (640) | β | β |
β | Operating revenues, net of royalties | β | β | β | β | 13β760 | β | β | β | β | β | 8β609 | β | β | β | β | β | 1β894 | β | β | β | β | β | 1β234 | β | β | β | β | β | 18β094 | β | β | β | β | β | 9β951 | β | β | β | β | β | (4β276) | β | β | β | β | β | (1β956) | β | β | β | β | β | 29β472 | β | β | β | β | β | 17β838 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Other income (loss) | β | β | β | β | 23 | β | β | β | β | β | (81) | β | β | β | β | β | 80 | β | β | β | β | β | 10 | β | β | β | β | β | (75) | β | β | β | β | β | (39) | β | β | β | β | β | 55 | β | β | β | β | β | 1 | β | β | β | β | β | 83 | β | β | β | β | β | (109) | β | β |
β | β | β | β | β | β | 13β783 | β | β | β | β | β | 8β528 | β | β | β | β | β | 1β974 | β | β | β | β | β | 1β244 | β | β | β | β | β | 18β019 | β | β | β | β | β | 9β912 | β | β | β | β | β | (4β221) | β | β | β | β | β | (1β955) | β | β | β | β | β | 29β555 | β | β | β | β | β | 17β729 | β | β |
β | Expenses | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Purchases of crude oil and products(1) | β | β | β | β | 1β014 | β | β | β | β | β | 595 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 12β867 | β | β | β | β | β | 6β987 | β | β | β | β | β | (3β845) | β | β | β | β | β | (1β752) | β | β | β | β | β | 10β036 | β | β | β | β | β | 5β830 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Operating, selling and general | β | β | β | β | 4β381 | β | β | β | β | β | 3β918 | β | β | β | β | β | 239 | β | β | β | β | β | 232 | β | β | β | β | β | 1β151 | β | β | β | β | β | 951 | β | β | β | β | β | 405 | β | β | β | β | β | 519 | β | β | β | β | β | 6β176 | β | β | β | β | β | 5β620 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Transportation and distribution | β | β | β | β | 580 | β | β | β | β | β | 556 | β | β | β | β | β | 48 | β | β | β | β | β | 72 | β | β | β | β | β | 150 | β | β | β | β | β | 123 | β | β | β | β | β | (17) | β | β | β | β | β | (20) | β | β | β | β | β | 761 | β | β | β | β | β | 731 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Depreciation, depletion, amortization and impairment | β | β | β | β | 2β384 | β | β | β | β | β | 2β250 | β | β | β | β | β | (376) | β | β | β | β | β | 293 | β | β | β | β | β | 411 | β | β | β | β | β | 417 | β | β | β | β | β | 50 | β | β | β | β | β | 42 | β | β | β | β | β | 2β469 | β | β | β | β | β | 3β002 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Exploration | β | β | β | β | 33 | β | β | β | β | β | 5 | β | β | β | β | β | 12 | β | β | β | β | β | 15 | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 45 | β | β | β | β | β | 20 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | (Gain) loss on disposal of assets | β | β | β | β | (1) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (11) | β | β | β | β | β | (8) | β | β | β | β | β | β | β | β | β | β | β | (8) | β | β | β | β | β | (12) | β | β | β | β | β | (16) | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Financing expenses | β | β | β | β | 191 | β | β | β | β | β | 177 | β | β | β | β | β | 45 | β | β | β | β | β | 34 | β | β | β | β | β | 27 | β | β | β | β | β | 22 | β | β | β | β | β | 560 | β | β | β | β | β | 107 | β | β | β | β | β | 823 | β | β | β | β | β | 340 | β | β |
β | β | β | β | β | β | 8β582 | β | β | β | β | β | 7β501 | β | β | β | β | β | (32) | β | β | β | β | β | 646 | β | β | β | β | β | 14β595 | β | β | β | β | β | 8β492 | β | β | β | β | β | (2β847) | β | β | β | β | β | (1β112) | β | β | β | β | β | 20β298 | β | β | β | β | β | 15β527 | β | β |
β | Earnings (Loss) before Income Taxes | β | β | β | β | 5β201 | β | β | β | β | β | 1β027 | β | β | β | β | β | 2β006 | β | β | β | β | β | 598 | β | β | β | β | β | 3β424 | β | β | β | β | β | 1β420 | β | β | β | β | β | (1β374) | β | β | β | β | β | (843) | β | β | β | β | β | 9β257 | β | β | β | β | β | 2β202 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Income Tax Expense (Recovery) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Current | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 2β428 | β | β | β | β | β | 512 | β | β |
β | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
β | Deferred | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | (116) | β | β | β | β | β | 1 | β | β |
β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 2β312 | β | β | β | β | β | 513 | β | β |
β | Net Earnings | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | 6β945 | β | β | β | β | β | 1β689 | β | β |
β | Capital and Exploration Expenditures(2)β | β | β | β | β | 1β573 | β | β | β | β | β | 1β373 | β | β | β | β | β | 198 | β | β | β | β | β | 133 | β | β | β | β | β | 393 | β | β | β | β | β | 495 | β | β | β | β | β | 142 | β | β | β | β | β | 149 | β | β | β | β | β | 2β306 | β | β | β | β | β | 2β150 | β | β |
β
(1)
The company revised certain gross revenues and purchases of crude oil and products to align with current period presentation. For the six months ended June 30, 2022, gross revenues and purchases of crude oil and products was decreased by $150 million, with no effect on net earnings.
β
(2)
Excludes capital expenditures related to assets held for sale ofβ $55Β million for the sixΒ months ended JuneΒ 30, 2022.
β
β
58Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
Disaggregation of Revenue from Contracts with Customers and Intersegment Revenue
The company derives revenue from the transfer of goods mainly at a point in time in the following major commodities, revenue streams and geographical regions:
β | ThreeΒ months ended JuneΒ 30 | β | β | 2022 | β | β | 2021 | β | ||||||||||||||||||||||||||||||
β | ($ millions) | β | β | North America | β | β | International | β | β | Total | β | β | North America | β | β | International | β | β | Total | β | ||||||||||||||||||
β | Oil Sands | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Synthetic crude oil and diesel | β | β | β | β | 6β541 | β | β | β | β | β | β | β | β | β | β | β | 6β541 | β | β | β | β | β | 3β294 | β | β | β | β | β | β | β | β | β | β | β | 3β294 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Bitumen | β | β | β | β | 2β221 | β | β | β | β | β | β | β | β | β | β | β | 2β221 | β | β | β | β | β | 1β342 | β | β | β | β | β | β | β | β | β | β | β | 1β342 | β | β |
β | β | β | β | β | β | 8β762 | β | β | β | β | β | β | β | β | β | β | β | 8β762 | β | β | β | β | β | 4β636 | β | β | β | β | β | β | β | β | β | β | β | 4β636 | β | β |
β | Exploration and Production | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Crude oil and natural gas liquids | β | β | β | β | 776 | β | β | β | β | β | 436 | β | β | β | β | β | 1β212 | β | β | β | β | β | 518 | β | β | β | β | β | 387 | β | β | β | β | β | 905 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Natural gas | β | β | β | β | β | β | β | β | β | β | 7 | β | β | β | β | β | 7 | β | β | β | β | β | β | β | β | β | β | β | 1 | β | β | β | β | β | 1 | β | β |
β | β | β | β | β | β | 776 | β | β | β | β | β | 443 | β | β | β | β | β | 1β219 | β | β | β | β | β | 518 | β | β | β | β | β | 388 | β | β | β | β | β | 906 | β | β |
β | Refining and Marketing | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Gasoline | β | β | β | β | 4β142 | β | β | β | β | β | β | β | β | β | β | β | 4β142 | β | β | β | β | β | 2β260 | β | β | β | β | β | β | β | β | β | β | β | 2β260 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Distillate | β | β | β | β | 5β128 | β | β | β | β | β | β | β | β | β | β | β | 5β128 | β | β | β | β | β | 2β030 | β | β | β | β | β | β | β | β | β | β | β | 2β030 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Other | β | β | β | β | 969 | β | β | β | β | β | β | β | β | β | β | β | 969 | β | β | β | β | β | 648 | β | β | β | β | β | β | β | β | β | β | β | 648 | β | β |
β | β | β | β | β | β | 10β239 | β | β | β | β | β | β | β | β | β | β | β | 10β239 | β | β | β | β | β | 4β938 | β | β | β | β | β | β | β | β | β | β | β | 4β938 | β | β |
β | Corporate and Eliminations | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | β | β | β | β | β | (2β405) | β | β | β | β | β | β | β | β | β | β | β | (2β405) | β | β | β | β | β | (883) | β | β | β | β | β | β | β | β | β | β | β | (883) | β | β |
β | Total Revenue from Contracts with Customers | β | β | β | β | 17β372 | β | β | β | β | β | 443 | β | β | β | β | β | 17β815 | β | β | β | β | β | 9β209 | β | β | β | β | β | 388 | β | β | β | β | β | 9β597 | β | β |
β | SixΒ months ended JuneΒ 30 | β | β | 2022 | β | β | 2021 | β | ||||||||||||||||||||||||||||||
β | ($ millions) | β | β | North America | β | β | International | β | β | Total | β | β | North America | β | β | International | β | β | Total | β | ||||||||||||||||||
β | Oil Sands | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Synthetic crude oil and diesel(1) | β | β | β | β | 12β229 | β | β | β | β | β | β | β | β | β | β | β | 12β229 | β | β | β | β | β | 6β641 | β | β | β | β | β | β | β | β | β | β | β | 6β641 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Bitumen | β | β | β | β | 4β003 | β | β | β | β | β | β | β | β | β | β | β | 4β003 | β | β | β | β | β | 2β346 | β | β | β | β | β | β | β | β | β | β | β | 2β346 | β | β |
β | β | β | β | β | β | 16β232 | β | β | β | β | β | β | β | β | β | β | β | 16β232 | β | β | β | β | β | 8β987 | β | β | β | β | β | β | β | β | β | β | β | 8β987 | β | β |
β | Exploration and Production | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Crude oil and natural gas liquids | β | β | β | β | 1β339 | β | β | β | β | β | 879 | β | β | β | β | β | 2β218 | β | β | β | β | β | 904 | β | β | β | β | β | 589 | β | β | β | β | β | 1β493 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Natural gas | β | β | β | β | β | β | β | β | β | β | 16 | β | β | β | β | β | 16 | β | β | β | β | β | β | β | β | β | β | β | 3 | β | β | β | β | β | 3 | β | β |
β | β | β | β | β | β | 1β339 | β | β | β | β | β | 895 | β | β | β | β | β | 2β234 | β | β | β | β | β | 904 | β | β | β | β | β | 592 | β | β | β | β | β | 1β496 | β | β |
β | Refining and Marketing | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Gasoline | β | β | β | β | 7β175 | β | β | β | β | β | β | β | β | β | β | β | 7β175 | β | β | β | β | β | 4β311 | β | β | β | οΏ½οΏ½ | β | β | β | β | β | β | β | 4β311 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Distillate | β | β | β | β | 8β973 | β | β | β | β | β | β | β | β | β | β | β | 8β973 | β | β | β | β | β | 4β317 | β | β | β | β | β | β | β | β | β | β | β | 4β317 | β | β |
β | ||||||||||||||||||||||||||||||||||||||
β | Other | β | β | β | β | 1β946 | β | β | β | β | β | β | β | β | β | β | β | 1β946 | β | β | β | β | β | 1β323 | β | β | β | β | β | β | β | β | β | β | β | 1β323 | β | β |
β | β | β | β | β | β | 18β094 | β | β | β | β | β | β | β | β | β | β | β | 18β094 | β | β | β | β | β | 9β951 | β | β | β | β | β | β | β | β | β | β | β | 9β951 | β | β |
β | Corporate and Eliminations(1) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | β | β | β | β | β | (4β276) | β | β | β | β | β | β | β | β | β | β | β | (4β276) | β | β | β | β | β | (1β956) | β | β | β | β | β | β | β | β | β | β | β | (1β956) | β | β |
β | Total Revenue from Contracts with Customers | β | β | β | β | 31β389 | β | β | β | β | β | 895 | β | β | β | β | β | 32β284 | β | β | β | β | β | 17β886 | β | β | β | β | β | 592 | β | β | β | β | β | 18β478 | β | β |
β
(1)
The company revised certain gross revenues and purchases of crude oil and products to align with current period presentation. For the six months ended June 30, 2022, gross revenues and purchases of crude oil and products was decreased by $150 million, with no effect on net earnings.
β
β
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 59
β
Notes to the Consolidated Financial Statements
4. Other Income (Loss)
Other income (loss) consists of the following:
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Energy trading and risk management | β | β | β | β | 38 | β | β | β | β | β | (86) | β | β | β | β | β | (55) | β | β | β | β | β | (162) | β | β |
β | ||||||||||||||||||||||||||
β | Investment and interest income | β | β | β | β | 31 | β | β | β | β | β | 23 | β | β | β | β | β | 64 | β | β | β | β | β | 46 | β | β |
β | ||||||||||||||||||||||||||
β | Other(1) | β | β | β | β | β | β | β | β | β | β | (3) | β | β | β | β | β | 74 | β | β | β | β | β | 7 | β | β |
β | β | β | β | β | β | 69 | β | β | β | β | β | (66) | β | β | β | β | β | 83 | β | β | β | β | β | (109) | β | β |
β
(1)
SixΒ months ended JuneΒ 30, 2022, includes a US$50Β million contingent consideration gain related to the sale of the companyβs 26.69% working interest in the Golden Eagle Area Development in the fourth quarter of 2021, within the Exploration & Production segment, and an unrealized gain on an equity investment, within the Corporate segment.
β
5. Share-Based Compensation
The following table summarizes the share-based compensation expense for all plans recorded within operating, selling and general expense:
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Equity-settled plans | β | β | β | β | 3 | β | β | β | β | β | 4 | β | β | β | β | β | 11 | β | β | β | β | β | 13 | β | β |
β | ||||||||||||||||||||||||||
β | Cash-settled plans | β | β | β | β | 137 | β | β | β | β | β | 80 | β | β | β | β | β | 335 | β | β | β | β | β | 182 | β | β |
β | β | β | β | β | β | 140 | β | β | β | β | β | 84 | β | β | β | β | β | 346 | β | β | β | β | β | 195 | β | β |
6. Financing Expenses
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Interest on debt | β | β | β | β | 221 | β | β | β | β | β | 216 | β | β | β | β | β | 416 | β | β | β | β | β | 426 | β | β |
β | ||||||||||||||||||||||||||
β | Interest on lease liabilities | β | β | β | β | 45 | β | β | β | β | β | 41 | β | β | β | β | β | 84 | β | β | β | β | β | 82 | β | β |
β | ||||||||||||||||||||||||||
β | Capitalized interest | β | β | β | β | (44) | β | β | β | β | β | (37) | β | β | β | β | β | (81) | β | β | β | β | β | (68) | β | β |
β | Interest expense | β | β | β | β | 222 | β | β | β | β | β | 220 | β | β | β | β | β | 419 | β | β | β | β | β | 440 | β | β |
β | ||||||||||||||||||||||||||
β | Interest on partnership liability | β | β | β | β | 13 | β | β | β | β | β | 13 | β | β | β | β | β | 26 | β | β | β | β | β | 26 | β | β |
β | ||||||||||||||||||||||||||
β | Interest on pension and other post-retirement benefits | β | β | β | β | 10 | β | β | β | β | β | 14 | β | β | β | β | β | 20 | β | β | β | β | β | 29 | β | β |
β | ||||||||||||||||||||||||||
β | Accretion | β | β | β | β | 76 | β | β | β | β | β | 77 | β | β | β | β | β | 154 | β | β | β | β | β | 151 | β | β |
β | ||||||||||||||||||||||||||
β | Foreign exchange loss (gain) on U.S. dollar denominated debt | β | β | β | β | 352 | β | β | β | β | β | (174) | β | β | β | β | β | 206 | β | β | β | β | β | (370) | β | β |
β | ||||||||||||||||||||||||||
β | Operational foreign exchange and other | β | β | β | β | (35) | β | β | β | β | β | 22 | β | β | β | β | β | (2) | β | β | β | β | β | 64 | β | β |
β | β | β | β | β | β | 638 | β | β | β | β | β | 172 | β | β | β | β | β | 823 | β | β | β | β | β | 340 | β | β |
During the second quarter of 2022, the company completed an early redemption, at par, of its outstanding US$450Β million 2.80% notes and US $550Β million 3.10% notes, originally due in 2023 and 2025, respectively. The company also completed a partial redemption, at par, for US$10.2Β million of its outstanding US$152Β million 6.00% notes, due in 2042.
During the first quarter of 2022, the company completed an early redemption of its outstanding US$182Β million 4.50% notes, originally scheduled to mature in the second quarter of 2022.
60Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
7. Earnings per Common Share
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Net earnings | β | β | β | β | 3β996 | β | β | β | β | β | 868 | β | β | β | β | β | 6β945 | β | β | β | β | β | 1β689 | β | β |
β | (millions of common shares)β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | Weighted average number of common shares | β | β | β | β | 1β406 | β | β | β | β | β | 1β502 | β | β | β | β | β | 1β420 | β | β | β | β | β | 1β512 | β | β |
β | ||||||||||||||||||||||||||
β | Dilutive securities: | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Effect of share options | β | β | β | β | 4 | β | β | β | β | β | 1 | β | β | β | β | β | 3 | β | β | β | β | β | 1 | β | β |
β | Weighted average number of diluted common shares | β | β | β | β | 1β410 | β | β | β | β | β | 1β503 | β | β | β | β | β | 1β423 | β | β | β | β | β | 1β513 | β | β |
β | (dollars per common share)β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | Basic earnings per share | β | β | β | β | 2.84 | β | β | β | β | β | 0.58 | β | β | β | β | β | 4.89 | β | β | β | β | β | 1.12 | β | β |
β | Diluted earnings per share | β | β | β | β | 2.83 | β | β | β | β | β | 0.58 | β | β | β | β | β | 4.88 | β | β | β | β | β | 1.12 | β | β |
8. Normal Course Issuer Bid
During the first quarter of 2022, the Toronto Stock Exchange (TSX) accepted a notice filed by Suncor to renew its normal course issuer bid (NCIB) to purchase the companyβs common shares through the facilities of the TSX, New York Stock Exchange and/or alternative trading systems. The notice provided that, beginning FebruaryΒ 8, 2022, and ending FebruaryΒ 7, 2023, Suncor may purchase for cancellation up to 71,650,000 common shares, which is equal to approximately 5% of Suncorβs issued and outstanding common shares as at the date hereof.
During the second quarter of 2022, Suncor received approval from the TSX to amend its existing NCIB effective as of the close of markets on MayΒ 11, 2022, to increase the maximum number of common shares that may be repurchased in the period beginning FebruaryΒ 8, 2022, and ending FebruaryΒ 7, 2023, from 71,650,000 common shares, or approximately 5% of Suncorβs issued and outstanding common shares as at JanuaryΒ 31, 2022, to 143,500,000, or approximately 10% of Suncorβs public float as at JanuaryΒ 31, 2022. No other terms of the NCIB have been amended.
For the threeΒ months ended JuneΒ 30, 2022, the company repurchased 53.5Β million common shares under the 2022 renewed NCIB at an average price ofβ $47.70 per share, for a total repurchase cost ofβ $2.6Β billion. For the sixΒ months ended JuneΒ 30, 2022, the company repurchased 7.1Β million common shares under the previous 2021 NCIB and 68.1Β million under the 2022 renewed NCIB at an average price ofβ $44.94 per share, for a total repurchase cost ofβ $3.4Β billion.
The following table summarizes the share repurchase activities during the period:
β | β | β | β | ThreeΒ months ended JuneΒ 30 | β | β | SixΒ months ended JuneΒ 30 | β | ||||||||||||||||||
β | ($ millions, except as noted) | β | β | 2022 | β | β | 2021 | β | β | 2022 | β | β | 2021 | β | ||||||||||||
β | Share repurchase activities (thousands of common shares) | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Shares repurchased | β | β | β | β | 53β513 | β | β | β | β | β | 22β934 | β | β | β | β | β | 75β212 | β | β | β | β | β | 34β989 | β | β |
β | Amounts charged to: | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||||||||||||||
β | Share capital | β | β | β | β | 892 | β | β | β | β | β | 377 | β | β | β | β | β | 1β249 | β | β | β | β | β | 576 | β | β |
β | ||||||||||||||||||||||||||
β | Retained earnings | β | β | β | β | 1β661 | β | β | β | β | β | 266 | β | β | β | β | β | 2β131 | β | β | β | β | β | 385 | β | β |
β | Share repurchase cost | β | β | β | β | 2β553 | β | β | β | β | β | 643 | β | β | β | β | β | 3β380 | β | β | β | β | β | 961 | β | β |
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 61
β
Notes to the Consolidated Financial Statements
Under an automatic repurchase plan agreement with an independent broker, the company has recorded the following liability for share repurchases that may take place during its internal blackout period:
β | ($ millions) | β | β | JuneΒ 30 2022 | β | β | DecemberΒ 31 2021 | β | ||||||
β | Amounts charged to: | β | β | β | β | β | β | β | β | β | β | β | β | β |
β | ||||||||||||||
β | Share capital | β | β | β | β | 251 | β | β | β | β | β | 120 | β | β |
β | ||||||||||||||
β | Retained earnings | β | β | β | β | 424 | β | β | β | β | β | 110 | β | β |
β | Liability for share purchase commitment | β | β | β | β | 675 | β | β | β | β | β | 230 | β | β |
9. Financial Instruments
Derivative Financial Instruments
(a) Non-Designated Derivative Financial Instruments
The company uses derivative financial instruments, such as physical and financial contracts, to manage certain exposures to fluctuations in interest rates, commodity prices and foreign currency exchange rates, as part of its overall risk management program, as well as for trading purposes.
The changes in the fair value of non-designated derivatives are as follows:
β | ($ millions) | β | β | Total | β | |||
β | Fair value outstanding at DecemberΒ 31, 2021 | β | β | β | β | (98) | β | β |
β | ||||||||
β | Cash settlementsβββpaid during the year | β | β | β | β | 117 | β | β |
β | ||||||||
β | Changes in fair value recognized in earnings during the year | β | β | β | β | 71 | β | β |
β | Fair value outstanding at JuneΒ 30, 2022 | β | β | β | β | 90 | β | β |
(b) Fair Value Hierarchy
To estimate the fair value of derivatives, the company uses quoted market prices when available, or third-party models and valuation methodologies that utilize observable market data. In addition to market information, the company incorporates transaction-specific details that market participants would utilize in a fair value measurement, including the impact of non-performance risk. However, these fair value estimates may not necessarily be indicative of the amounts that could be realized or settled in a current market transaction. The company characterizes inputs used in determining fair value using a hierarchy that prioritizes inputs depending on the degree to which they are observable. The three levels of the fair value hierarchy are as follows:
β’
LevelΒ 1 consists of instruments with a fair value determined by an unadjusted quoted price in an active market for identical assets or liabilities. An active market is characterized by readily and regularly available quoted prices where the prices are representative of actual and regularly occurring market transactions to assure liquidity.
β
β’
LevelΒ 2 consists of instruments with a fair value that is determined by quoted prices in an inactive market, prices with observable inputs or prices with insignificant non-observable inputs. The fair value of these positions is determined using observable inputs from exchanges, pricing services, third-party independent broker quotes and published transportation tolls. The observable inputs may be adjusted using certain methods, which include extrapolation over the quoted price term and quotes for comparable assets and liabilities.
β
β’
LevelΒ 3 consists of instruments with a fair value that is determined by prices with significant unobservable inputs. As at JuneΒ 30, 2022, the company does not have any derivative instruments measured at fair value LevelΒ 3.
β
In forming estimates, the company utilizes the most observable inputs available for valuation purposes. If a fair value measurement reflects inputs of different levels within the hierarchy, the measurement is categorized based upon the lowest level of input that is significant to the fair value measurement.
The following table presents the companyβs derivative financial instruments measured at fair value for each hierarchy level as at JuneΒ 30, 2022:
β | ($ millions) | β | β | LevelΒ 1 | β | β | LevelΒ 2 | β | β | LevelΒ 3 | β | β | Total Fair Value | β | ||||||||||||
β | Accounts receivable | β | β | β | β | 108 | β | β | β | β | β | 110 | β | β | β | β | β | β | β | β | β | β | β | 218 | β | β |
β | ||||||||||||||||||||||||||
β | Accounts payable | β | β | β | β | (59) | β | β | β | β | β | (69) | β | β | β | β | β | β | β | β | β | β | β | (128) | β | β |
β | β | β | β | β | β | 49 | β | β | β | β | β | 41 | β | β | β | β | β | β | β | β | β | β | β | 90 | β | β |
62Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.
β
During the second quarter of 2022, there were no transfers between LevelΒ 1 and LevelΒ 2 fair value measurements.
Non-Derivative Financial Instruments
At JuneΒ 30, 2022, the carrying value of fixed-term debt accounted for under amortized cost was $12.9Β billion (DecemberΒ 31, 2021βββ$14.2Β billion) and the fair value was $13.1Β billion (DecemberΒ 31, 2021βββ$17.4Β billion). The estimated fair value of long-term debt is based on pricing sourced from market data.
10. Asset Impairment
Exploration and Production
White Rose assets:
During the second quarter of 2022, the company announced that concurrent with the decision to restart the West White Rose project by the joint venture owners, Suncor has increased its ownership in the White Rose asset by 12.5% to approximately 39% (previously approximately 26%). The decision to restart was driven by a revised royalty structure and development plan. The company received $38Β million (net of taxes ofβ $12Β million) in cash consideration to acquire the additional working interest, which was primarily allocated to the asset retirement obligation and property, plant and equipment of the project. As a result of these events, during the second quarter of 2022, the company performed an impairment reversal test on the White Rose cash generating unit (CGU) as the recoverable amount of this CGU was sensitive to the restart decision. The impairment reversal test was performed using a recoverable amount based on the fair value less cost of disposal. An expected cash flow approach was used with the key assumptions discussed below (LevelΒ 3 fair value inputsβββnoteΒ 9).
As a result of the impairment reversal test, the recoverable amounts were determined to be greater than the carrying values of the White Rose CGU and the company recorded an impairment reversal ofβ $542Β million (net of taxes ofβ $173Β million) on its previous share of the White Rose assets in the Exploration and Production segment. The recoverable amount was determined based on the following asset-specific assumptions:
β’
Brent price forecast of US$85.00/bbl in 2023, US$68.00 in 2024 and US$69.00 in 2025, escalating at 2% per year thereafter over the life of the project to 2038 and adjusted for asset-specific location and quality differentials;
β
β’
anticipated first oil for the West White Rose project in the first half of 2026 and the companyβs share of production of approximately 9,800 bbls/d (based on its previous working interest of approximately 26%) over the life of the project;
β
β’
the companyβs share of future capital expenditures ofβ $1.5Β billion, including the West White Rose expansion; and
β
β’
risk-adjusted discount rate of 9.0% (after-tax).
β
No other indicators of impairment or reversals of impairment were identified at JuneΒ 30, 2022.
11. Provisions
Suncorβs decommissioning and restoration provision decreased by $2.6Β billion for the sixΒ months ended JuneΒ 30, 2022. The decrease was primarily due to an increase in the credit-adjusted risk-free interest rate to 5.70% (DecemberΒ 31, 2021βββ3.70%).
12. Pensions and Other Post-Retirement Benefits
For the sixΒ months ended JuneΒ 30, 2022, the actuarial gain on employee retirement benefit plans was $898Β million (net of taxes ofβ $283Β million), mainly due to an increase in the discount rate to 5.00% (DecemberΒ 31, 2021βββ2.90%).
2022 Second QuarterΒ Β Β Suncor Energy Inc.Β Β Β 63
β
Notes to the Consolidated Financial Statements
13. Assets Held For Sale
During the second quarter of 2022, the company reclassified the assets and liabilities related to its wind and solar assets as assets held for sale, including its interests in wind farms located in Alberta and Ontario, with the Forty Mile Wind and Solar Power Project currently under construction and expected to be completed and operational in 2022. The sale process is progressing with the sale expected to close early in 2023. The renewable energy business are reported within the Corporate segment.
The table below details the assets and liabilities held for sale as at JuneΒ 30, 2022:
β | β | β | β | JuneΒ 30 | β | |||
β | ($ millions) | β | β | 2022 | β | |||
β | Assets | β | β | β | β | β | β | β |
β | ||||||||
β | Current assets | β | β | β | β | 22 | β | β |
β | ||||||||
β | Property, plant and equipment, net | β | β | β | β | 381 | β | β |
β | Total Assets | β | β | β | β | 403 | β | β |
β | Liabilities | β | β | β | β | β | β | β |
β | ||||||||
β | Current liabilities | β | β | β | β | (85) | β | β |
β | ||||||||
β | Other long-term liabilities and provisions | β | β | β | β | (29) | β | β |
β | ||||||||
β | Deferred income taxes | β | β | β | β | (47) | β | β |
β | Total Liabilities | β | β | β | β | (161) | β | β |
β | Net Assets | β | β | β | β | 242 | β | β |
Subsequent to the second quarter of 2022, the company reached an agreement for the sale of its Norway assets in the Exploration and Production segment, pending regulatory approval, including its 30% working interest in Oda and its 17.5% working interest in the Fenja Development Joint Operations, for gross proceeds of approximately $410Β million (Canadian dollar equivalent), before closing adjustments and other closing costs. The sale is expected to be completed in the fourth quarter of 2022, with an effective date of MarchΒ 1, 2022.
In the first quarter of 2022, the company reclassified the assets and liabilities related to its Norway operations as assets held for sale and performed an impairment test on the Norway assets held for sale as at JuneΒ 30, 2022. The impairment tests were performed using the lower of its carrying amount and fair value less costs to sell (LevelΒ 2 fair value inputsβββnoteΒ 9). The company recorded a $47Β million charge related to the impairment on its share of the Norway operations, net of a $23Β million deferred tax adjustment associated with the assets held for sale.
The table below details the assets and liabilities held for sale as at JuneΒ 30, 2022:
β | β | β | β | JuneΒ 30 | β | |||
β | ($ millions) | β | β | 2022 | β | |||
β | Assets | β | β | β | β | β | β | β |
β | ||||||||
β | Currents assets(1) | β | β | β | β | 87 | β | β |
β | ||||||||
β | Property, plant and equipment, net | β | β | β | β | 325 | β | β |
β | ||||||||
β | Deferred income taxes | β | β | β | β | 45 | β | β |
β | Total Assets | β | β | β | β | 457 | β | β |
β | Liabilities | β | β | β | β | β | β | β |
β | ||||||||
β | Current liabilities | β | β | β | β | (29) | β | β |
β | ||||||||
β | Provisions | β | β | β | β | (30) | β | β |
β | Total Liabilities | β | β | β | β | (59) | β | β |
β | Net Assets | β | β | β | β | 398 | β | β |
β
(1)
Current assets include $71Β million of cash and cash equivalents as at JuneΒ 30, 2022.
β
β
64Β Β Β 2022 Second QuarterΒ Β Β Suncor Energy Inc.