Canadian Natural Resources Reports Record Production and Strong Financials

Canadian Natural Resources ((TSE:CNQ)) has held its Q4 earnings call. Read on for the main highlights of the call.

Canadian Natural Resources recently held its earnings call, revealing a generally positive sentiment with record production levels and strong financial performance. The company reported substantial dividend increases and successful acquisitions, although it acknowledged challenges like stagnation in natural gas production and deferred activities due to lower prices. Overall, the positive achievements significantly outweighed the lowlights.

Record Annual Production

Canadian Natural Resources achieved a remarkable milestone with record annual total production of approximately 1.36 million barrels of oil equivalent (BOEs) per day. This includes a record liquids production of over 1 million barrels per day, showcasing the company’s robust operational capabilities.

Operational Cost Reduction

The company successfully reduced its operational costs, with oil sands mining and upgraded operating costs averaging $22.88 per barrel in 2024. This marks a significant reduction from previous levels, highlighting Canadian Natural’s focus on cost efficiency.

Strong Financial Performance

Canadian Natural reported an impressive annual adjusted funds flow of $14.9 billion, with $4.2 billion generated in the fourth quarter of 2024 alone. The company returned approximately $7.1 billion to shareholders throughout the year, underscoring its strong financial health.

Significant Dividend Increases

In a move to reward its shareholders, Canadian Natural increased its annualized quarterly dividend by 59%, from $1.42 to $2.25 per share. This was followed by a subsequent 4% increase, reflecting the company’s confidence in its financial stability.

Successful Acquisitions

The acquisition of Chevron’s 70% operator working interest in Duvernay added approximately 60,000 BOEs per day in 2025, enhancing Canadian Natural’s production capacity and strategic asset base.

Robust Reserve Replacement

The company achieved a robust reserve replacement, replacing 2024 production by 365% on a total proved basis and 422% on a total proved plus probable basis, ensuring long-term sustainability of its resource base.

Natural Gas Production Stagnation

Despite the overall positive performance, Canadian Natural’s North American natural gas production averaged 2.14 BCF in 2024, comparable to 2023, indicating a stagnation in growth that the company needs to address.

Deferred Dry Natural Gas Activity

Certain dry natural gas activities were deferred in 2024 due to lower natural gas prices, reflecting the company’s strategic response to market conditions.

Challenges in the North Sea

Operations in the North Sea are winding down, with no plans for significant new investments, highlighting a shift in focus away from this region.

Forward-Looking Guidance

Looking ahead, Canadian Natural remains optimistic with record annual total production and strategic acquisitions contributing to a 9% increase in reserves. The company maintains a strong financial position with a debt-to-EBITDA ratio of 1.1x and liquidity of $4.7 billion, positioning it well for future growth.

In summary, Canadian Natural Resources’ earnings call painted a positive picture of the company’s performance, with record production levels, strong financial results, and strategic acquisitions. While challenges in natural gas production and the North Sea were noted, the company’s achievements and forward-looking guidance suggest a promising outlook.