Imperial Oil profit jumps more than six-fold on crude price rally

·2-min read

By Nia Williams and Arunima Kumar

(Reuters) - Imperial Oil Ltd reported a more than six-fold jump in second-quarter profit on Friday, as the Canadian energy company benefited from a surge in energy prices after the Russian invasion of Ukraine.

Global crude prices have rallied this year as sanctions on major oil exporter Russia over its invasion of Ukraine fueled concerns about already tight supplies. Brent crude , the global benchmark, was last trading around $110 a barrel.

Imperial, which is majority owned by Exxon Mobil Corp, said its quarterly upstream production averaged 413,000 gross oil-equivalent barrels per day (boepd), up from 401,000 boepd a year earlier.

However, the company downgraded its full-year production guidance for the Kearl oil sands mine, its largest project, to 245,000 barrels per day from 265,000-270,000 bpd because of unplanned downtime in the first half of the year.

"After a challenging start to 2022 with some significant weather impacts...our operations returned to normal in the second quarter," Imperial Chief Executive Brad Corson said on an earnings call.

Corson also raised concerns about the Canadian government's plan to cap and cut carbon emissions from the oil and gas sector by 2030, echoing criticism from rival producer Cenovus Energy earlier this week.

"I do take concern with it because it's very aggressive, it stretches the capability of what's technically and economically feasible," he said.

Imperial and Cenovus are part of the Oil Sands Pathways to Net-Zero alliance, a group of six companies aiming to reach net-zero emissions by 2050.

The Calgary, Alberta-based company's net earnings rose to C$2.41 billion ($1.88 billion), or C$3.63 per share, in the three months ended June 30, from C$366 million, or 50 Canadian cents per share, a year earlier.

During the second quarter, Imperial said it will sell Canadian shale assets jointly-owned with Exxon to Whitecap Resources Inc for C$1.9 billion, which equates to a C$940 million share for Imperial.

Corson said the sale is on track to close before the end of the third quarter.

Imperial shares were last up 3% on the Toronto Stock Exchange at C$62.11.

(Reporting by Arunima Kumar in Bengaluru; Editing by Maju Samuel and Marguerita Choy)

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