By Sonja Franklin Nov. 5 (Bloomberg) -- Canadian Natural Resources Ltd., which earlier this year started up the Horizon oil-sands project, said third-quarter profit fell 77 percent on lower crude and natural-gas prices. Net income fell to C$658 million ($618 million), or C$1.21 a share, from C$2.84 billion, or C$5.25, a year earlier, the Calgary-based company said in a statement issued by Market Wire. Revenue after royalties fell to C$2.58 billion from C$3.97 billion. New York crude futures were 42 percent lower on average in the third quarter than a year earlier, while gas prices dropped 62 percent. Almost 40 percent of Canadian Natural’s output is gas, making the company the country’s second-largest producer of the heating fuel after EnCana Corp. The company was expected to earn C$1.31 a share, the average estimate of six analysts compiled by Bloomberg. Excluding one-time costs, profit was C$1.21 a share. On that basis, it missed the C$1.26 average of 14 analyst estimates compiled by Bloomberg. Oil production before royalties rose 17 percent to 359,269 barrels a day, the company said. Gas output slipped 13 percent to 1.29 billion cubic feet a day. Before hedging, the company’s oil sold for an average of C$62.90 a barrel, a 39 percent decline from a year earlier. The company’s gas price before hedging sold for an average of C$3.80 per thousand cubic feet, down 57 percent from a year earlier. Horizon Project Canadian Natural started output of synthetic crude from the C$9.7 billion Horizon project in February. Horizon, in northeastern Alberta, is ramping up and produced an average of 59,599 barrels a day in the second quarter. The project is designed for a capacity of 110,000 barrels a day. The earnings statement was issued before the start of regular trading on North American stock exchanges. Canadian Natural fell 40 cents to C$68.60 on the Toronto Stock Exchange yesterday. The shares, which have 12 buy ratings and 11 holds from analysts, have gained about 41 percent this year. To contact the reporter on this story: Sonja Franklin in Calgary at sfranklin6@bloomberg.net

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