(Bloomberg) -- Canadian Natural Resources Ltd. and Cenovus Energy Inc., two of the country’s largest energy companies, are cutting back on gas drilling as prices for the fuel languish.
Canadian Natural, which already reported that it was reallocating capital from some dry natural gas developments to heavy-oil wells, said Thursday that it’s further reducing its gas-drilling program to 74 wells in 2024, 17 fewer than budgeted. Cenovus Chief Executive Officer Jon McKenzie said on an earnings call that the company has deferred completion of some gas wells to the end of the year, with new sites primarily targeting liquids.
Canadian gas prices fell to a two-year low last month as drillers ramped up production to prepare for next year’s startup of the country’s first major liquefied natural gas export plant on the Pacific Coast. North American gas prices more broadly have declined as warmer weather reduces demand for the heating fuel and swells inventories.
Canadian Natural’s third-quarter adjusted earnings released Thursday topped analysts’ estimates on strong production volumes. Cenovus’ earnings matched analysts’ estimates, with profit held back by a downstream operating margin shortfall of C$323 million ($232 million) after its Lima Refinery in the US underwent major maintenance.
Canadian Natural shares fell 0.9% to C$47.09 at 2:35 p.m. in Toronto, while Cenovus slid 4.4% to C$22.17.
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