NEW YORK (TheStreet) -- Despite facing declining crude-oil prices and restrictions to markets, Suncor Energy (SU) is in a better position than other Canadian energy producers, because it can generate more cash than its competitors and use its financial strength to gain access to networks to transport oil out of Alberta.
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Suncor will seek to move ahead with major projects, even if Brent prices hover between $80 and $85 a barrel, as it expects "to generate free cash flow", company spokeswoman Erin Ross said in an email to TheStreet, quoting the CEO Steve Williams' comments.
Nick Lupick, an analyst at AltaCorp Capital, forecast in a Nov. 19 report that Suncor will be able to generate positive free cash flow of about $2.48 billion, before dividends and buybacks, He wrote that the figure is the highest in Suncor's peer group, which includes Imperial Oil (IMO) , Canadian Natural Resources (CNQ) and Cenovus Energy (CVE) .
Calgary-based Suncor said last week that it would have between $6.4 and $6.8 billion capital spending in 2015, compared with the current year's estimate of $5.9 billion. That will lead to production of 540,000 to 585,000 barrels of oil equivalents a day, compared with the company's current year's estimate of 525,000 to 570,000 barrel.
Besides its oil-sands operations, Suncor also has profitable oil refining and marketing business, which includes four refineries and which was responsible for 30% of the company's earnings from core operations in the previous quarter.
In an Oct. 30 report, Morningstar analyst Jason Stevens said that since 2011, Suncor has earned refining margins of $25.74 a barrel, higher than the industry's average of less than $24 a barrel.