Suncor Energy Inc.

Good day, and thank you for standing by. Welcome to the Suncor Energy second quarter 2025 financial results 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 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Suncor Energy Senior Vice President of External Affairs, Mr. Troy Little.

Thank you, operator, and good morning. Welcome to Suncor Energy's second quarter earnings call. Please note that today's comments contain forward-looking information. Actual results may differ materially from the expected results. because of various risk factors and assumptions that are described in our second quarter earnings release, as well as in our current annual information form, both of which are available on CDAR, EDGAR, and our website, Sancor.com. Certain financial measures referred to in these comments are not prescribed by Canadian generally accepted accounting principles. For a description of these financial measures, please see our second quarter earnings release. We will start with comments from Rich Krueger, President and Chief Executive Officer, followed by Chris Smith, Suncor's Chief Financial Officer. Also on the call are Peter Zebedee, Executive Vice President, Oil Sands, and Dave Oldry, Executive Vice President, Downstream. Following the formal remarks, we'll open the call up to questions. Now, I'll hand it over to Rich to share his comments.

Thanks, Troy. Our second quarter was about completing major maintenance and project activities and positioning for a strong second half. We successfully accomplished both. I'll highlight operational performance. Chris will cover financial. Let me first start with personnel and process safety. Following our two safest years ever in 2023 and 2024, I'm pleased to report the first half of 2025 has been even safer in all categories across the board, a credit to our employees and our contractors. Upstream production, our highest second quarter and our highest first half in company history. First half at 831,000 barrels a day, our previous best set last year by 28,000 barrels a day. For those keeping score, our past four quarters have all set quarterly records. First half upgrade or utilization 94% despite major base plant turnaround activity over two years, the first half of 25 versus the first half of 23 we've achieved a production increase of 89,000 barrels a day. This increase alone would rank as Canada's 10th largest oil producer. Refining throughput, again, highest second quarter and highest first half in company history. First half at 462,000 barrels a day beat our previous best, also set last year, by 20,000 barrels a day. Like the upstream, our past four quarters have all set quarterly throughput records. First half refining utilization, 99%. Here again, despite major turnaround activity, Over two years, the first half of 25 versus the first half of 23, we've achieved a throughput increase of 81,000 barrels a day. This increase alone would rank as essentially Canada's 10th largest refinery. Product sales, same story. Highest second quarter and highest first half in company history. First half at 603,000 barrels a day beat our previous best. Once again, set last year by 15,000 barrels a day. Like refining and upstream, our past four quarters have all set quarterly sales records. We've had 13 months in our history with sales greater than 600,000 barrels a day. Nine of the 13 have been in the past 12 months. Over two years, first half of 25 versus first half of 23 achieved a product sales increase of 72,000 barrels a day. This increase alone equivalent to 5% of Canada's entire refined product sales. Operating costs, first half OS&G, $6.46 billion, down $135 million versus the first half of 24, despite higher production, higher refining throughput, and higher product sales. Over two years, the first half of 25 versus the first half of 23, OS&G is down $765 million, despite 89,000 barrels a day higher production, 81,000 barrels a day higher refining throughput, and 72,000 barrels a day higher product sales. The message, we continue to achieve higher performance, significantly higher volumes, significantly lower costs, setting records, raising the bar, quarter on quarter, year on year, operating leverage, creating value, through our people, their expertise, commitment, and determination, focused on what we can control, embracing a culture that every barrel and every dollar matter. Let me move to turnarounds. Historically, greater than 20% of our capital, $1.25 billion per year, has been spent on turnarounds. For two years, we've been focused on improving cost and schedule performance. via benchmarking, risk-based work selection, work planning, and execution. In May of last year, at our Investor Day, we committed to reduce turnaround costs by $250 million per year over three years. With that backdrop, I'll highlight second quarter performance. Edmonton Refinery, large work scope, including major crude units. Previous turnaround of the same unit was 44 days. Our 2025 plan was 41 days. We completed it in 36, improving from the fourth quartile in North America to the second quartile. Previous cost, $159 million. This year, 142, $17 million or 11% lower. Compliments to Gavin Knight and the Edmonton team. Sarnia refinery, also several units, including major crude. Previous turnaround of the same scope, 44 days. Our 2025 plan was 40 days. We completed it in 28, improving from fourth quartile to first quartile. Previous cost, $108 million. This year, 94. $14 million or 13% lower. Credit to Leslie DeCarolis and the Sarnia team. Base plant upgrader one. Initial estimate was synced with the Coke drum replacement project at greater than 100 days. Our 2025 plan required the turnaround completion in less than 91. We completed it in 67. Planned cost, $259 million. We completed it for 231, 28 million or 11% lower, improving from fourth quartile performance to second. Well done to Bruce Dernford and the Green Plant team. 2025's turnaround schedule is split between the second and third quarters, with third quarter events including firebag plant 92, Montreal Refinery, Edmonton Refinery, and Syncrude 8-1 Coker. Overall, we project 2025 performance to be approaching industry second quartile, with second quartile in North America representing best in class in Canada. Bottom line, we are exceeding our improvement targets. initially focused on duration and cost, now interval extensions. In fact, our 2026 business plan, which is under development, includes interval extensions on future base plant and syncrude cokers, Edmonton and Sarnia refineries, and all firebank plant turnarounds. Therefore, based on our improvement and our confidence, we are raising our annual turnaround capital reduction target by $100 million, from $250 million per year to $350 million per year. This does not include the added benefit of higher uptimes and associated volumes. I want to talk about two capital projects completed in the second quarter. Base Plant U1 Coke Drum Replacement, the most extensive coke drum replacement project in industry history. Eight 100-foot-tall, 26-foot-diameter drums weighing nearly 300 tons each. New drums, foundations, cutting decks, ancillary systems. 40 heavy lifts with one of the world's largest cranes, the heaviest equivalent to 620 Ford F-150 pickup trucks. We funded it at $1.2 billion. Initially scoped at more than 100 days, we committed to 91 in guidance, reviewed by third-party experts for validity. Well, Ryan Jackson and his team completed it in an astounding 67 days, a 24-day improvement versus guidance, 165 million, or 14% below funding, Our project was literally executed flawlessly. Every detail was mapped out. Every scenario was contemplated. We built full-scale models to practice the most critical steps. Bottom line, we systematically de-risked the entire event. World-class performance by any standard. Now, decades of benefits, modernized design, upgraded metallurgy, automated controls, enhanced safety systems, lower maintenance costs, and higher reliability, I would urge you to check out our website for a three-minute video on the project. Second project, Syncrude, Mildred Lake West Mine Extension, $1.5 billion gross project to develop 730 million barrels of bitumen replacing the North Mine. Project involved a new mine, haul roads, transport bridge, power lines, and pipeline. The oil sands lease is literally the size of Manhattan. We developed it without a new tailings pond or processing plant. We achieved first ore in April, six months ahead of schedule, at a cost $100 million below funding. Kudos to Niaz Ahmed and Adrian Larkin and their teams. Our 2025 project and turnaround performances illustrate that today's Suncorp delivers, beating ambitious, benchmark-based performance improvement targets. Guidance. Last December, we issued a 2025 capital guidance range of $61 to $63 billion. Since then, we have accelerated turnaround improvements. executed major capital projects under budget, and performed better across a wide range of base business activities with an intense organization-wide focus on capital and capital efficiency. As a result, today we issued a revised lower 2025 capital range of $5.7 to $5.9 billion, a midpoint reduction of $400 million. Incremental free funds will go to buybacks. And although it's too early in the year to update volumes, year-to-date performance points to the high end of all guidance ranges. Institutionalizing operational excellence. Fifteen months ago, on our first quarter 2024 earnings call, I described Suncor's longstanding system to manage risk reliability, and overall operational performance. A system that provided sites with operational requirements or expectations, but a system that left it up to each site to determine how to meet the expectations. I shared with you that we judged that system to be too complex and insufficient in meeting our high performance standards of today. As a result, we designed an entirely new system to achieve operational excellence based on work processes, processes such as managing reliability and managing maintenance, 21 standards detailing how to achieve operational excellence based on industry best practice. It was developed by subject matter experts and frontline employees for more than a year. Our objective to ensure clarity, consistency, and quality in how we operate. Conversion from the old system to our new system started in earnest in late 2024. I'm pleased to report we achieved our ambitious timeline with all sites now fully converted to our new system. The new system is literally a game changer, institutionalizing operational excellence, reducing site by site variation, and elevating overall performance. I personally reviewed page by page all 21 work processes and practices, and based on my 40 years of experience, I can attest it's best in class. Special call out to Sylvie Tran and her team who led this work, and to our site leaders for embracing the change. With that, I'll turn it over to Chris.