Suncor - one of the largest players in the oilsands - is shutting production to cope with low oil prices and virus impact.
The announcement calls for Suncor to shut in one of its two so-called 'trains' at the 2 year old Fort Hills oilsands mine.
The company also is delaying the start up of its MacKay River oilsands wells to May, after operations were halted in December because of a malfunction and fire.
Suncor Energy also said that it will be cutting it's capital spending by 26% in 2020, adding the company to the list of Canadian oil producers to slash their budgets in recent weeks.
The Company's cuts come as as the Coronavirus pandemic combined with the sustained Saudi / Russia price war sends global oil benchmarks such as Brent Crude and West Texas Intermediate to the lowest prices seen in 20 years.
In Canada, Western Canadian Select - the oilsands benchmark - fell to $8.54/barrel which is likely to be a record low should it settle at this price.
The guidance for Suncor’s share of Fort Hills bitumen production in 2020 was reduced to between 55,000 to 65,000 barrels a day from between 85,000 to 95,000 barrels a day, the company said in its release.
The use of one train at the mine "will increase cash flow, particularly when bitumen prices are extremely low, as we are able to significantly reduce variable costs," the company said.
"Unit costs for the remaining production will be higher because of this decision as a result of fixed costs being covered by lower volumes.”
At the time of this article, Western Canadian Select had climbed to $11.24.