1 minute read
Long-Term Investment
from Group Project
CANADIAN NATURAL RESOURCES LIMITED (CNQ.TO)
Challenge
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As an oil and gas producer, CNQ’s earnings and cash flow are highly dependent on oil and gas prices, which can be volatile. This poses risks for long-term investors.
CNQ has struggled to grow its oil and gas production in recent years. Production is expected to remain flat or decline in the near future.
“Tightening environmental regulations around emissions and resource development pose ongoing challenges for CNQ” (Zeng et al., 2022).
Solution
▶ CNQ focuses on cost optimization and maintains a strong balance sheet to navigate through commodity price cycles. It also pays a stable dividend.
▶ CNQ is focusing on expanding its oil sands operations and implementing new technologies to optimize production and recover more resources.
▶ CNQ is investing in emission reduction technologies and processes to improve the sustainability and efficiency of its operations. It has set targets to reduce emissions intensities.
*Data sourced from Yahoo Finance.
