Imperial Oil announces estimated fourth-quarter financial and operating results
Calgary, Alberta, February 1, 2013
Imperial Oil made significant progress in advancing its growth strategy in 2012. Earnings in the fourth quarter were $1,076 million, an increase of seven percent compared with the corresponding 2011 period. Fourth quarter Downstream earnings were $549 million, the strongest single quarter earnings on record. Solid refining operations allowed us to capture strong mid-continent refining margins.
Earnings for the full year 2012 were $3,766 million, the second highest in our company’s history and up 12 percent from 2011. Both the Downstream and Chemical businesses achieved best-ever annual earnings of $1,772 million and $165 million, respectively.
We commenced commissioning of the Kearl initial development in the latter months of 2012, and good progress toward first oil continues today. Despite U.S. permitting and regulatory issues that continued for almost two years involving transportation of facility modules, our project team achieved industry-leading safety performance, and mitigated significant challenges, including an early onset of winter and exceptionally harsh weather during current start-up operations. We continue to focus on completing start-up safely, and expect production of mined diluted bitumen from the first froth treatment train in this quarter. Production will ramp up to 110,000 barrels a day over the next several months. The final cost for the Kearl initial development is expected to be $12.9 billion.
Together, the initial development and expansion projects will develop 3.2 billion barrels at a unit development cost of approximately $6.80 per barrel. This is up 10 percent from the prior estimate of $6.20 per barrel driven by the cost to re-sequence work from the module transportation issues and the early onset of winter and harsh weather during start-up of the Kearl initial development.
The Kearl expansion project, sanctioned in 2011 for $8.9 billion, will benefit substantially from the infrastructure provided by the initial development. We are making good progress and are currently ahead of schedule. Start-up of the expansion project is planned in 2015.
Click here to read our interim report news release.
Imperial Oil is one of Canada’s largest corporations and a leading member of the country’s petroleum industry. The company is a major producer of crude oil and natural gas, Canada’s largest petroleum refiner, a key petrochemical producer and a leading marketer with coast-to-coast supply and retail service station networks.