Canadian Natural Resources Q2 Earnings Call Highlights

Canadian Natural Resources’ second-quarter production rose 18% year over year to approximately 1.677 million BOE per day, while adjusted net earnings reached C$4.6 billion and adjusted funds flow hit a record C$6.9 billion.

The company raised its 2026 production guidance midpoint by 20,000 BOE per day, returned C$2.4 billion directly to shareholders in the quarter, and reduced net debt by C$1.6 billion.

Medium- and long-term growth projects, including Jackfish, Pike 2 and additional mining developments, will remain on hold until definitive regulatory and fiscal agreements are completed, targeted for this fall.

Canadian Natural Resources NYSE: CNQ reported record second-quarter production, adjusted earnings and adjusted funds flow, supported by strong oil sands performance, higher output from acquired assets and favorable pricing for synthetic crude oil.

President Scott Stauth said the company set eight operational and financial records during the quarter, citing operational execution, capital efficiency and continuous-improvement initiatives across its asset base.

Total corporate production reached approximately 1.677 million barrels of oil equivalent per day, up 18% from the same period a year earlier.

Oil sands mining and upgrading production averaged about 625,000 barrels per day in the second quarter, the highest quarterly level in the company’s history.

The result came despite challenging spring weather, including snowmelt and heavy rain, according to Stauth.

Production from the oil sands mining and upgrading business increased approximately 161,000 barrels per day, or 35%, from the second quarter of 2025.

Canadian Natural attributed the increase to operating performance, its additional working interest in the AOSP mines acquired during the fourth quarter of 2025, and the completion of the AOSP turnaround last year.

Upgrader utilization averaged 106% in the quarter.

Stauth said the company remains focused on optimizing capacity and obtaining incremental “creep” production from its upgrading facilities, though he said it was premature to formally reassess facility capacity ratings.

Synthetic crude oil, or SCO, captured an average premium of $8.37 per barrel to WTI during the quarter.

Combined with oil sands mining and upgrading operating costs of C$22.19 per barrel, that produced a record per-barrel netback of about C$78, Stauth said.

During the question-and-answer session, Stauth said SCO pricing is dependent in part on demand for diesel production.

He said he expects SCO pricing to remain at parity with, or modestly above, WTI through the remainder of the year, while noting the uncertainty around commodity pricing.

Total liquids production reached a record approximately 1.249 million barrels per day, an increase of 23% from a year earlier.

Canadian Natural said roughly two-thirds of its liquids output consisted of high-value SCO, light crude oil and natural gas liquids.

North American conventional E&P liquids production reached approximately 338,000 barrels per day, up 25% year over year.

North American light crude oil and NGL production totaled approximately 205,000 barrels per day, up 45% from the second quarter of 2025.

Jackfish thermal in-situ production reached a record approximately 136,000 barrels per day, exceeding its 120,000-barrel-per-day nam...