Canadian Natural Resources Limited

Good morning. We would like to welcome everyone to Canadian Naturals 2026 Second Quarter Earnings Conference Call and Webcast. After the presentation, we will conduct a question and answer session. Instructions will be given at that time. Please note that this call is being recorded today, August 6, 2026, at 9 a.m. Mountain Time. I would now like to turn the meeting over to your host for today's call, Lance Casson, Manager of Investor Relations.

Good morning everyone, and thank you for joining Canadian Natural's 2026 Second Quarter Results Conference Call. Before we begin, I'd like to remind you of our forward-looking statements, and it should be noted that in our reporting disclosures, everything is in Canadian dollars unless otherwise stated, and we report reserves and production before royalties. Also, I would suggest you review the advisory section in our financial statements that include comments on non-GAAP disclosures. Speaking on today's call will be Scott Stauth, our President, and Victor Darel, our Chief Financial Officer. As usual, also in the room with us this morning is Robin Zabek, CEO of A&P, Jay Froc, CEO of Oil and Sand, and Ron Lang, Chief Commercial Officer. Scott will begin by going through our numerous operational records and leading operating costs as our teams continue to execute in the quarter. Victor will then go through our strong financial results, significant returns to shareholders, and material net debt reductions. To close, Scott will summarize prior to opening up the line for questions. With that, over to you, Scott.

Thank you. Good morning, everyone. Q2 2026 was a very strong quarter, reflecting our continued focus on operational excellence, capital efficiency, and continuous improvement, which drove eight new operational and financial records across our asset base. An example of this performance was achieved in our world-class oil sands mining and upgrading operations, where we experienced challenging weather elements like other oil sands operations. However, our teams successfully managed those challenges, allowing the company to not only exceed our budget, but we also achieved the highest quarterly production in the company's history, averaging approximately 625,000 barrels per day Q2 with high upgrader utilization of 106%. Oil sands mining and upgrading production in the quarter represents an increase of approximately 161,000 barrels per day or 35% compared to Q2 2025 levels reflecting strong operational performance. The additional working interest in the AOST mines acquired in Q4 2025 and These world-class assets provide high-value synthetic crude oil, which captured robust pricing in Q2, with the SEO premium to WTI averaging $8.37 per barrel in the quarter. And when combined with industry-leading low operating costs of $22.19 per barrel, resulted in the highest oil sands mining and upgrading per barrel net back ever achieved by the company during the quarter at approximately $78 per barrel. Cash flow generation from our oil sands mining and upgrading assets was significant and operations delivered strong results. In addition to record oil sands mining and upgrading production, we also achieved record quarterly and all of our other partners. An increase of 230,000 barrels per day, or 23% from Q2 2025 levels. Importantly, two-thirds of our total liquids production in Q2 is high-value SEO, live crude oil, and NGLs, generating significant cash flow. We also achieved record North American conventional EMP liquids production of approximately 338,000 barrels per day, representing an increase of 67,000 barrels per day or 25% from Q2 2025 levels. Included in this record, North American light crude oil and NGL production of approximately 205,000 barrels per day. This production is up approximately 64,000 barrels per day or 45% from Q2 2025, primarily reflecting accretive acquisitions and strong doing results. Thermal in-situ production was strong as well, with record production of jackfish of approximately 136,000 barrels per day, exceeding our facility main plate capacity of 120,000 barrels per day. Strong production of jackfish was supported by the two new SAG B-pads at Site 1, which are currently averaging approximately 46,000 barrels per day, with an SOR of 1.8. The resource at Pike is top tier with results continuing to exceed our expectations. In addition to production records achieved this quarter, we also set some record financial results including adjusted net earnings and adjusted fund flow with which Victor will provide more details on later in the call. Our financial results include the benefit from our material sulfur production As we produce approximately 30% of Canada's sulfur supply, which generated significant net revenue of approximately $450 million in the first two quarters of this year. With record production and strong performance across our asset base, along with an accretive acquisition completed in Q2, we are increasing our annual production guidance range for the second time this year. Annual production is now targeted to be between 1.637 million BOEs per day and 1.682 million BOEs per day, a 20,000 BOE per day increase at the midpoint from the previous guidance range. We remain focused on executing our prudent and efficient 2026 capital program as our operational capital Operating capital remains unchanged at approximately $6 billion before net acquisition costs. Our ability to effectively allocate capital across our large and diverse asset base provides us with a unique competitive advantage and, when combined with accretive acquisitions, continues to create significant long-term value for our shareholders. With that, I will pass it over to Victor for our Q2 financial review.