Suncor Energy Inc.

Good day and thank you for standing by and welcome to the Suncor Energy First Quarter 2021 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Mr. Trevor Bell, VP, Investor Relations. Please go ahead.

Thank you, Operator, and good morning. Welcome to Suncor's first quarter earnings call. With me this morning are Mark Little, President and Chief Executive Officer, and Alistair Callen, Chief Financial Officer. Please note that today's comments contain forward-looking information. The actual results may differ materially from the expected results because of various risk factors and assumptions, and they are described in our first quarter earnings release as well as our current annual information form. Both of these are available on CDAR, EDGAR, and our website, suncor.com. Certain financial measures referred to in these comments are not prescribed by Canadian GAAP. For a description of these financial measures, please see our first quarter earnings release. Following formal remarks, we'll open the call up to questions. Now I'll hand it over to Mark for his comments.

Great. Thanks, Trevor, and good morning. Thank you for joining us. Before I get into our opening remarks, I would like to note that we'll be hosting investor and analyst community at our virtual investor day on May 26th. On that day, we'll address in detail the outlook for our business from an operating and capital allocation and ESG performance perspective. As a result, our remarks today will be focused primarily on our first quarter results. In the first quarter, we executed upon the commitments we have made to our shareholders, namely operational excellence, financial resilience, shareholder returns, and fortifying our business. record in situ production of 252,000 barrels a day and a disciplined focus on costs across the company. This performance was supported by increased upgrading flexibility achieved through Syncrude and Baseplant interconnecting pipelines. Within our downstream business, we generated nearly $1 billion of funds flow from operations as our 92% utilization at our refineries continued their industry leadership position. Our physically integrated model generated $2.2 billion of funds from operations, excluding the restructuring charge of approximately $125 million after tax related to our previously announced headcount reductions. We reduced our total debt by $1.1 billion and returned approximately $640 million to shareholders through dividends and share buybacks, or roughly 30% of funds from operations. Our buyback resumed at the beginning of February, and including purchases made in April, we bought back approximately 20 million shares for $530 million. representing a buyback yield of 5% on our market cap on an annualized basis. Focusing on operating performance, our fourth quarter call, I mentioned that the combined base plant and Zinc crude upgraders set the second best quarterly SEO production in our history with 514,000 barrels a day. This trend continued into the first quarter with even stronger production of 520,000 barrels a day. Together, these two quarters mark the highest ever SCO production at our combined upgrading facilities over a six-month period. This performance reflects our strategy to maximize the value of each barrel. We have a similar good news story on costs, which we continue to drive down. Many of you had recognized the improved cost performance in Q4, closing out the year at the bottom end of our 2020 guidance range. The first quarter trended 12% below these levels, reflecting the significant strides made in 2020 on the initiatives to structurally improve the cost of our business. As a result, the first quarter oil sands operations costs averaged $23 a barrel Canadian, more than absorbing the 20% quarter-over-quarter natural gas price increase. Syncrude achieved 94% utilization with cash operating costs of $32 a barrel during the first quarter. Along with the other owners and personnel at Syncrude, we are making good progress on the smooth transfer of operatorship of Syncrude to us by the end of the third quarter. At Fort Hills, our net production averaged 51,000 barrels a day, reflecting a change in the mine ramp-up strategy. With full partner support, a decision was made to reset the mine plan. Over the next four months, we will increase the available ore inventory to provide a consistent feed to the plant while keeping our production flat. Appropriate ore inventory levels are required to operate the plant at 90% of nameplate capacity on a two-train operation. This change does not impact our production guidance range for the year. It merely changes the production profile throughout the year. Our downstream had another good market leading quarter, generating nearly $1 billion of funds from operation, despite continued stay-at-home orders across Canada. We leveraged our midstream assets and expertise to capture robust margins and exported significantly higher volumes. I'm confident that as you see the cracks improve and the Canadian economy unlocks as vaccinations pick up, we will continue to build on this level of profitability, both in volumes and margin increases. Finally, and most importantly, we hold the health and safety of our employees and contractors above all else. Currently, the third wave of the pandemic in Canada is significantly impacting the region of Fort McMurray. Given this situation, and with Syncrude in the middle of turnaround schedule, we've delayed the start of our U2 turnaround at base plant until at least June. We will see when this gets finalized. This decision supports the completion of Syncrude turnaround and minimizes the overlap between the two assets. These measures have been taken to ensure our planned maintenance can be performed safely and efficiently. We currently expect no material impact to our 2021 guidance. We also continue to work with the community of Fort McMurray and with governments and other industry players to accelerate rapid testing and now vaccinations in the region. We will continue to provide assistance to the community and its citizens during these trying times. I'll now hand it over to Alistair to go through our financial highlights.