Calgary-based Canadian Natural also said it would boost its quarterly dividend by 25%, echoing similar moves by rival oil sands majors Suncor Energy and Cenovus Energy.
Global oil prices have surged to multi-year highs in 2021 but investors are rewarding companies that spend excess cash on dividends and buybacks, rather than on production growth.
"We don't think there would be too many companies that would want to sanction anything major (in the oil sands) today," Canadian Natural President Tim McKay told Reuters in an interview. "We are looking at smaller expansions similar to what we have been able to do in the past."
The company tweaked its capital allocation plan to allow for strategic acquisitions and growth spending once a C$15 billion ($12.03 billion) absolute debt level is achieved, but analysts said Canadian Natural was unlikely to change its overall strategy of returning cash to shareholders.
"The revision to the capital allocation plan provides management with additional flexibility in creating long-term value for shareholders but we suspect that cash returns remain the focus heading into 2022," George Huang, an analyst at Raymond James said in a note to clients.
Canadian Natural said it remains on track to meet its full-year 2021 capital investment target of about C$3.48 billion.
On an adjusted basis, the company earned C$2.1 billion from operations in the third quarter, or C$1.77 per share, compared with estimates of C$1.58, according to data provider Refinitiv IBES.
Canadian Natural, which has production in Canada, the North Sea and offshore Africa, produced 1.24 million barrels of oil equivalent per day (boepd) in the third quarter, compared with 1.1 million boepd a year earlier.
($1 = 1.2467 Canadian dollars)
(Reporting by Sahil Shaw in Bengaluru; Editing by Subhranshu Sahu, Shounak Dasgupta and Marguerita Choy)
By Nia Williams and Sahil Shaw
