(Reuters) -Canadian Natural Resources Ltd on Wednesday forecast higher production for 2023, as it seeks to capitalize on higher oil and gas prices and set new environmental targets.
Demand for oil and gas has surged following sanctions on Russia after it invaded Ukraine earlier this year, as Europe scrambles to replace gas from Russia and improve long-term energy security.
Calgary, Alberta-based Canadian Natural said it expects total production in 2023 to be about 4% higher than previous targets for this year and sharpened its shareholder return policy.
"With our prudent 2023 capital budget, low maintenance capital requirements and an asset base with long life low decline, high value production, we target to continue to deliver significant free cash flow in 2023," Chief Financial Officer Mark Stainthorpe said in a statement.
However, Canadian oil sands producers generating billions more in free cash flow have come under pressure to meet the country’s goal on energy transition.
Canadian Natural said it is now targeting a 40% reduction in total greenhouse gas emissions from its operations by 2035, from baseline of 2020.
The company expects to spend C$5.2 billion ($3.84 billion) next year, compared with C$4.9 billion it forecast for this year.
It expects total production in 2023 to be between 1.33 million and 1.37 million barrels of oil equivalent per day (boepd), the mid-point of which was in line with Street expectations.
($1 = 1.3547 Canadian dollars)
(Reporting by Mrinalika Roy; Editing by Sherry Jacob-Phillips, Shinjini Ganguli and Maju Samuel)