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Imperial Oil's quarterly profit falls on lower refining margin, higher costs

Published 2019-11-01, 08:29 a/m
© Reuters.  Imperial Oil's quarterly profit falls on lower refining margin, higher costs
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Nov 1 (Reuters) - Canada's Imperial Oil Ltd IMO.TO reported a 43% fall in quarterly profit on Friday, as higher Canadian crude prices dented refining margins and expenses rose.

The company said refinery throughput averaged 363,000 barrels per day (bpd) in the third quarter, compared with 388,000 bpd a year earlier.

Earnings from downstream unit fell nearly 56% to C$221 million in the quarter.

Canada's main oil-producing province, Alberta, imposed mandatory curbs on oil production this year, reducing a price discount on Canadian oil compared with U.S. oil. The move, which helped some producers, was opposed by integrated companies such as Imperial, which benefited from low-cost oil to run through their refineries.

Narrower Canadian crude price differentials have also made it less economic for producers to ship their crude by rail.

Alberta's current government, elected in April, on Thursday answered the call from a number of producers to allow them to produce above their current limit as long as any incremental production is moved to the market by rail.

Imperial said crude-by-rail shipments averaged 52,000 bpd in the quarter, compared to 64,000 bpd in the previous quarter.

The company, majority-owned by Exxon Mobil Corp (NYSE:XOM) XOM.N , said net income fell to C$424 million ($322.12 million), or 56 Canadian cents per share, in the third quarter, from C$749 million, or 94 Canadian cents, a year earlier. company's gross production averaged 407,000 barrels of oil equivalent per day (boepd), up from 393,000 boepd in the year-prior quarter.

($1 = 1.3163 Canadian dollars)

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