For the three months ended March 31,
2015
CALGARY, April 30, 2015 /CNW/ -
|
|
|
First
quarter
|
(millions of dollars,
unless noted)
|
2015
|
2014
|
%
|
|
|
|
|
Net income (U.S.
GAAP)
|
421
|
946
|
(55)
|
Net income per common
share
|
|
|
|
|
- assuming dilution
(dollars)
|
0.50
|
1.11
|
(55)
|
|
|
|
|
Capital and
exploration expenditures
|
1,050
|
1,234
|
(15)
|
Rich Kruger, Chairman,
President and Chief Executive Officer, commented:
Imperial's first quarter results underscore our disciplined
focus on operational excellence, the strength of our integrated
business model and our ability to deliver strong results across a
range of market conditions. The quarter's highlights include
significantly increased Kearl production volumes, initial
production from the Cold Lake Nabiye project, continued strong
refinery throughput along with aggressive pursuit and capture of
cost savings in the current business environment.
Earnings in the first quarter were $421
million, or $0.50 per share, a
decrease of 55 percent compared with the corresponding 2014 period,
mainly due to a more than 50 percent decline in global crude
prices, partially offset by strong operating performance.
Gross production averaged 333,000 gross oil-equivalent barrels
per day, up 3,000 barrels from the first quarter of 2014. Excluding
the impact of conventional assets divested in 2014, total
production was up six percent or 18,000 barrels per day. With
improved plant reliability, Kearl production averaged 95,000
barrels per day (67,000 barrels Imperial's share) in the quarter,
up significantly from the same period in 2014 and the fourth
quarter of 2014.
Refinery throughput averaged 393,000 barrels per day, up 15,000
barrels per day from the same period in 2014. Refinery capacity
utilization averaged 93 percent, up three percent, as a result of
our sustained focus on reliability.
First quarter capital and exploration expenditures totaled
$1,050 million, down nearly
$200 million versus 2014, as our Cold
Lake Nabiye and Kearl expansion projects advanced closer to
completion.
Imperial's response to the current business environment includes
an increased selectivity in new capital investments, a sharpened
scrutiny of all operating expenditures and ongoing engagement with
our suppliers and contractors to improve cost efficiency and
productivity. Our extensive, results-oriented approach is
strengthening our resiliency, while ensuring the company remains
well-positioned to achieve our long-term goals. Above all, our
focus remains on delivering superior, long-term shareholder value
in whatever business environment we operate in.
First quarter highlights
- Net income totalled $421
million or $0.50 per share on
a diluted basis, down 55 percent from $946 million or $1.11 per share for the first quarter of 2014.
This drop was largely due to a more than a 50 percent decline in
global crude oil prices, partially offset by strong operating
performance.
- Production averaged 333,000 gross oil-equivalent barrels per
day, up 3,000 barrels versus the first quarter of 2014.
Excluding the impact of conventional assets divested in 2014,
production was up six percent.
- Refinery throughput averaged 393,000 barrels per day, up
15,000 barrels from the same period in 2014. Reflective of
continued strong operating reliability, capacity utilization
averaged 93 percent, up three percent from the corresponding
quarter in 2014.
- Petroleum product sales averaged 474,000 barrels per day
in the first quarter, largely unchanged from the same period in
2014. The company continues to aggressively pursue growth in
profitable Canadian markets.
- Cash generated from operating activities was $281 million, a decrease of $804 million from the first quarter of 2014,
primarily due to lower earnings and working capital effects.
- Capital and exploration expenditures of $1,050 million were down nearly $200 million versus 2014, and primarily directed
towards the completion of the Kearl expansion and Cold Lake Nabiye
upstream projects.
- Kearl bitumen production averaged 95,000 barrels per day
(67,000 barrels Imperial's share) up from 70,000 barrels per day
(50,000 barrels Imperial's share) in the first quarter of 2014. All
three trains have been simultaneously operated at capacity. Kearl's
85-megawatt cogeneration unit started up and was synchronized to
the Alberta electrical grid early
in the quarter. Cogenerated power will reduce energy costs, improve
reliability and reduce greenhouse gas emissions.
- Kearl expansion project commissioning continued to
progress, with a target start-up now anticipated by about
mid-year 2015. The project is expected to ultimately produce
110,000 barrels per day gross (78,000 barrels Imperial's share)
with production ramp-up to benefit from lessons learned from the
Kearl initial development.
- Cold Lake Nabiye bitumen production began in the quarter as
planned. After initial steam injection in January, bitumen
production commenced in late February, averaging 12,000 barrels per
day in March (4,000 barrels in the quarter). Production is expected
to reach approximately 40,000 barrels per day, before royalties, by
the end of 2015. The Nabiye cogeneration facility was also
commissioned during this quarter and will supply 150 megawatts of
power to the Alberta electrical
grid.
- Edmonton rail terminal
advanced commissioning and start-up activities. The first unit
train was loaded in late April. Along with other initiatives, the
terminal, a joint venture operated by Kinder Morgan, will provide access to the
highest-value markets for equity crude production and continue to
supply price-advantaged feedstock to company refineries.
- New oil sands research centre to be built in southeast
Calgary. The centre will
further advance Imperial's capabilities in developing
next-generation resource recovery and associated technologies for
responsibly developing oil sands resources. Full occupancy of the
centre, located in Quarry Park near the company's new corporate
office complex, is planned for 2017.
- Committed $1 million to
support growth in Women Building Futures. The funding, provided
over five years, will allow the organization to further develop
women interested in careers in energy industry trades. Imperial has
worked with Women Building Futures, a government and
industry-funded initiative, since 2008 to support heavy-equipment
operator training programs. Many women who have completed
training have subsequently achieved employment at Imperial's Kearl
oil sands operation.
First quarter 2015 vs. first quarter 2014
The company's net income for the first quarter of 2015 was
$421 million or $0.50 per share on a diluted basis, compared with
$946 million or $1.11 per share for the same period last
year.
Upstream recorded a net loss in the first quarter of
$189 million, compared to income of
$452 million in the same period of
2014. Earnings in the first quarter 2015 reflected the impact of
lower crude oil and gas realizations of about $1,100 million. This was partially offset by
lower royalties of about $200
million, the impact of a weaker Canadian dollar of about
$160 million, higher Kearl and
Cold Lake volumes of about
$60 million and lower energy costs of
about $60 million.
West Texas Intermediate (WTI), the main U.S. dollar benchmark
crude for North America, decreased
by 51 percent compared to the same quarter in 2014. The company's
average first quarter 2015 Canadian
dollar realizations for synthetic crude oil and bitumen were
$55.81 and $27.40 per barrel, lower by 48 and 58 percent
respectively, as a result of the weaker Canadian dollar and
increased heavy – light differentials versus the same period in
2014. The company's average realizations on natural gas sales of
$3.15 per thousand cubic feet, in the
first quarter of 2015, were lower by $3.41 per thousand cubic feet, versus the same
period in 2014.
Gross production of Cold Lake
bitumen averaged 152,000 barrels per day, up from 147,000 barrels
from the same period last year. Incremental volume growth of 4,000
barrels per day was achieved with initial first quarter 2015
production from the Nabiye project.
The company's share of Syncrude's gross production in the first
quarter was 73,000 barrels per day, unchanged from the first
quarter of 2014.
Gross production from the Kearl initial development was 95,000
barrels per day (67,000 barrels Imperial's share) compared to
70,000 barrels per day (50,000 barrels Imperial's share) in the
first quarter of 2014 as a result of improved reliability.
Gross production of conventional crude oil averaged 15,000
barrels per day in the first quarter, versus 22,000 barrels in the
corresponding period in 2014. The lower production volume was
primarily due to the impact of properties divested during the first
half of 2014.
Gross production of natural gas during the first quarter of 2015
was 146 million cubic feet per day, down from 205 million cubic
feet in the same period last year, reflecting the impact of
properties divested during the first half of 2014.
Downstream net income was $565
million in the first quarter, compared to $488 million in the first quarter of 2014.
Increased earnings were primarily due to higher marketing margins
and a first quarter 2015 gain of $17
million from the sale of assets, partially offset by lower
refining margins.
Chemical net income was $66
million in the first quarter, up $23
million over the same period in 2014, mainly as a result of
strong polyethylene margins.
Net income effects from Corporate and Other were negative
$21 million in the first quarter,
versus negative $37 million in the
same period of 2014, primarily due to lower share-based
compensation charges.
Cash flow generated from operating activities was $281 million in the first quarter, versus
$1,085 million in the corresponding
period in 2014. Lower cash flow was primarily due to lower earnings
and working capital effects.
Investing activities used net cash of $1,002 million in the first quarter, compared
with $1,143 million in the same
period of 2014. Additions to property, plant and equipment were
$1,011 million in the first quarter,
compared with $1,206 million during
the same quarter in 2014. Expenditures during the quarter were
primarily directed towards the completion of the Cold Lake Nabiye
and Kearl expansion projects.
Cash from financing activities was $566
million in the first quarter, compared with cash used in
financing activities of $112 million
in the first quarter of 2014. In the first quarter, the company
increased long-term debt by $717
million through its existing loan facility to finance normal
operations and capital projects. Dividends paid in the first
quarter of 2015 were $110 million,
unchanged from the corresponding period in 2014. Per-share dividend
paid in the first quarter was $0.13,
consistent with the same period of 2014.
The above factors led to a decrease in the company's balance of
cash to $60 million at March 31, 2015, from $215
million at the end of 2014.
Key financial and operating data follow.
Forward-Looking Statements
Statements of future events or conditions in this report,
including projections, targets, expectations, estimates, and
business plans are forward-looking statements. Actual future
results, including demand growth and energy source mix; production
growth and mix; project plans, dates, costs and capacities;
production rates and resource recoveries; cost savings; product
sales; financing sources; and capital and environmental
expenditures could differ materially depending on a number of
factors, such as changes in the price, supply of and demand for
crude oil, natural gas, and petroleum and petrochemical products;
political or regulatory events; project schedules; commercial
negotiations; the receipt, in a timely manner, of regulatory and
third-party approvals; unanticipated operational disruptions;
unexpected technological developments; and other factors discussed
in this report and Item 1A of Imperial's most recent Form 10-K.
Forward-looking statements are not guarantees of future performance
and involve a number of risks and uncertainties, some that are
similar to other oil and gas companies and some that are unique to
Imperial. Imperial's actual results may differ materially from
those expressed or implied by its forward-looking statements and
readers are cautioned not to place undue reliance on them.
The term "project" as used in this release can refer to a
variety of different activities and does not necessarily have the
same meaning as in any government payment transparency
reports.
Attachment
I
|
|
IMPERIAL OIL
LIMITED
|
FIRST QUARTER
2015
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
millions of Canadian
dollars, unless noted
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
Net Income (U.S.
GAAP)
|
|
|
|
|
|
|
|
Total revenues and
other income
|
|
|
|
6,203
|
|
9,226
|
|
Total
expenses
|
|
|
|
5,642
|
|
7,966
|
|
Income before income
taxes
|
|
|
|
561
|
|
1,260
|
|
Income
taxes
|
|
|
|
140
|
|
314
|
|
Net income
|
|
|
|
421
|
|
946
|
|
|
|
|
|
|
|
|
Net income per common
share (dollars)
|
|
|
|
0.50
|
|
1.12
|
|
Net income per common
share - assuming dilution (dollars)
|
|
|
|
0.50
|
|
1.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Financial
Data
|
|
|
|
|
|
|
|
Federal excise tax
included in operating revenues
|
|
|
|
377
|
|
370
|
|
|
|
|
|
|
|
|
Gain/(loss) on asset
sales, after tax
|
|
|
|
23
|
|
16
|
|
|
|
|
|
|
|
|
Total assets at March
31
|
|
|
|
41,608
|
|
38,745
|
|
|
|
|
|
|
|
|
Total debt at March
31
|
|
|
|
7,548
|
|
6,285
|
|
Interest coverage
ratio - earnings basis
|
|
|
|
|
|
|
|
|
(times
covered)
|
|
|
|
51.7
|
|
49.8
|
|
|
|
|
|
|
|
|
Other long-term
obligations at March 31
|
|
|
|
3,784
|
|
3,114
|
|
|
|
|
|
|
|
|
Shareholders' equity
at March 31
|
|
|
|
22,707
|
|
20,361
|
|
Capital employed at
March 31
|
|
|
|
30,276
|
|
26,669
|
|
Return on average
capital employed (a)
|
|
|
|
|
|
|
|
|
(percent)
|
|
|
|
11.3
|
|
12.0
|
|
|
|
|
|
|
|
|
Dividends declared on
common stock
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
110
|
|
110
|
|
|
Per common share
(dollars)
|
|
|
|
0.13
|
|
0.13
|
|
|
|
|
|
|
|
|
|
Millions of common
shares outstanding
|
|
|
|
|
|
|
|
|
At March
31
|
|
|
|
847.6
|
|
847.6
|
|
|
Average - assuming
dilution
|
|
|
|
850.5
|
|
850.5
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Return on capital
employed is net income excluding after-tax cost of financing
divided by the average rolling four quarters' capital
employed
|
|
|
|
Attachment
II
|
|
IMPERIAL OIL
LIMITED
|
FIRST QUARTER
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
millions of Canadian
dollars
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Total cash and
cash equivalents at period end
|
|
|
|
60
|
|
102
|
|
|
|
|
|
|
|
|
Net
income
|
|
|
|
421
|
|
946
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
Depreciation and
depletion
|
|
|
|
317
|
|
280
|
|
(Gain)/loss on asset
sales
|
|
|
|
(26)
|
|
(20)
|
|
Deferred income taxes
and other
|
|
|
|
18
|
|
5
|
Changes in operating
assets and liabilities
|
|
|
|
(449)
|
|
(126)
|
Cash flows from
(used in) operating activities
|
|
|
|
281
|
|
1,085
|
|
|
|
|
|
|
|
|
Cash flows from
(used in) investing activities
|
|
|
|
(1,002)
|
|
(1,143)
|
|
Proceeds associated
with asset sales
|
|
|
|
25
|
|
75
|
|
|
|
|
|
|
|
|
Cash flows from
(used in) financing activities
|
|
|
|
566
|
|
(112)
|
|
|
|
|
|
|
|
|
Attachment
III
|
|
IMPERIAL OIL
LIMITED
|
FIRST QUARTER
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
millions of Canadian
dollars
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Net income (U.S.
GAAP)
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
(189)
|
|
452
|
|
Downstream
|
|
|
|
565
|
|
488
|
|
Chemical
|
|
|
|
66
|
|
43
|
|
Corporate and
other
|
|
|
|
(21)
|
|
(37)
|
|
Net income
|
|
|
|
421
|
|
946
|
|
|
|
|
|
|
|
|
Revenues and other
income
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
1,812
|
|
3,278
|
|
Downstream
|
|
|
|
4,955
|
|
7,088
|
|
Chemical
|
|
|
|
349
|
|
458
|
|
Eliminations/Other
|
|
|
|
(913)
|
|
(1,598)
|
|
Total
|
|
|
|
6,203
|
|
9,226
|
|
|
|
|
|
|
|
|
Purchases of crude
oil and products
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
838
|
|
1,405
|
|
Downstream
|
|
|
|
3,195
|
|
5,416
|
|
Chemical
|
|
|
|
182
|
|
319
|
|
Eliminations
|
|
|
|
(910)
|
|
(1,598)
|
|
Purchases of crude
oil and products
|
|
|
|
3,305
|
|
5,542
|
|
|
|
|
|
|
|
|
Production and
manufacturing expenses
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
950
|
|
1,029
|
|
Downstream
|
|
|
|
356
|
|
386
|
|
Chemical
|
|
|
|
53
|
|
61
|
|
Eliminations
|
|
|
|
-
|
|
-
|
|
Production and
manufacturing expenses
|
|
|
|
1,359
|
|
1,476
|
|
|
|
|
|
|
|
|
Capital and
exploration expenditures
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
890
|
|
1,163
|
|
Downstream
|
|
|
|
125
|
|
48
|
|
Chemical
|
|
|
|
12
|
|
2
|
|
Corporate and
other
|
|
|
|
23
|
|
21
|
|
Capital and
exploration expenditures
|
|
|
|
1,050
|
|
1,234
|
|
|
|
|
|
|
|
|
|
Exploration expenses
charged to income included above
|
|
|
|
17
|
|
21
|
|
|
|
|
|
|
|
|
Attachment
IV
|
|
IMPERIAL OIL
LIMITED
|
FIRST QUARTER
2015
|
|
|
|
|
|
|
|
|
Operating
statistics
|
|
|
|
Three
Months
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Gross crude oil
and Natural Gas Liquids (NGL) production
|
|
|
|
|
|
|
(thousands of barrels
per day)
|
|
|
|
|
|
|
|
Cold Lake
|
|
|
|
152
|
|
147
|
|
Syncrude
|
|
|
|
73
|
|
73
|
|
Kearl
|
|
|
|
67
|
|
50
|
|
Conventional
|
|
|
|
15
|
|
22
|
|
Total crude oil
production
|
|
|
|
307
|
|
292
|
|
NGLs available for
sale
|
|
|
|
2
|
|
4
|
|
Total crude oil and
NGL production
|
|
|
|
309
|
|
296
|
|
|
|
|
|
|
|
|
Gross natural gas
production (millions of cubic feet per day)
|
|
|
|
146
|
|
205
|
|
|
|
|
|
|
|
Gross
oil-equivalent production (a)
|
|
|
|
|
|
|
(thousands of
oil-equivalent barrels per day)
|
|
|
|
333
|
|
330
|
|
|
|
|
|
|
|
Net crude oil and
NGL production (thousands of barrels per day)
|
|
|
|
|
|
|
Cold Lake
|
|
|
|
139
|
|
113
|
|
Syncrude
|
|
|
|
69
|
|
69
|
|
Kearl
|
|
|
|
66
|
|
47
|
|
Conventional
|
|
|
|
15
|
|
18
|
|
Total crude oil
production
|
|
|
|
289
|
|
247
|
|
NGLs available for
sale
|
|
|
|
1
|
|
3
|
|
Total crude oil and
NGL production
|
|
|
|
290
|
|
250
|
Net natural gas
production (millions of cubic feet per day)
|
|
|
|
143
|
|
182
|
|
|
|
|
|
|
|
Net oil-equivalent
production (a)
|
|
|
|
|
|
|
(thousands of
oil-equivalent barrels per day)
|
|
|
|
314
|
|
281
|
|
|
|
|
|
|
|
Cold Lake blend
sales (thousands of barrels per day)
|
|
|
|
207
|
|
197
|
Kearl blend
sales (thousands of barrels per day)
|
|
|
|
82
|
|
60
|
NGL sales
(thousands of barrels per day)
|
|
|
|
6
|
|
10
|
|
|
|
|
|
|
|
Average
realizations (Canadian dollars)
|
|
|
|
|
|
|
|
Conventional crude
oil realizations (per barrel)
|
|
|
|
27.21
|
|
71.69
|
|
NGL realizations (per
barrel)
|
|
|
|
25.12
|
|
66.28
|
|
Natural gas
realizations (per thousand cubic feet)
|
|
|
|
3.15
|
|
6.56
|
|
Synthetic oil
realizations (per barrel)
|
|
|
|
55.81
|
|
106.50
|
|
Bitumen realizations
(per barrel)
|
|
|
|
27.40
|
|
65.19
|
|
|
|
|
|
|
|
|
Refinery
throughput (thousands of barrels per day)
|
|
|
|
393
|
|
378
|
Refinery capacity
utilization (percent)
|
|
|
|
93
|
|
90
|
|
|
|
|
|
|
|
Petroleum product
sales (thousands of barrels per day)
|
|
|
|
|
|
|
|
Gasolines
(Mogas)
|
|
|
|
234
|
|
232
|
|
Heating, diesel and
jet fuels (Distillates)
|
|
|
|
187
|
|
190
|
|
Heavy fuel oils
(HFO)
|
|
|
|
19
|
|
20
|
|
Lube oils and other
products (Other)
|
|
|
|
34
|
|
34
|
|
Net petroleum
products sales
|
|
|
|
474
|
|
476
|
|
|
|
|
|
|
|
Petrochemical
sales (thousands of tonnes)
|
|
|
|
225
|
|
230
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Gas converted to
oil-equivalent at 6 million cubic feet = 1 thousand
barrels
|
|
|
|
|
Attachment
V
|
|
IMPERIAL OIL
LIMITED
|
FIRST QUARTER
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
per
|
|
|
|
Net income (U.S.
GAAP)
|
|
|
|
common share -
diluted
|
|
|
|
(millions of Canadian
dollars)
|
|
|
|
(dollars)
|
|
|
|
|
|
|
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
781
|
|
|
|
|
|
0.91
|
Second
Quarter
|
|
726
|
|
|
|
|
|
0.85
|
Third
Quarter
|
|
859
|
|
|
|
|
|
1.01
|
Fourth
Quarter
|
|
1,005
|
|
|
|
|
|
1.18
|
Year
|
|
3,371
|
|
|
|
|
|
3.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
1,015
|
|
|
|
|
|
1.19
|
Second
Quarter
|
|
635
|
|
|
|
|
|
0.75
|
Third
Quarter
|
|
1,040
|
|
|
|
|
|
1.22
|
Fourth
Quarter
|
|
1,076
|
|
|
|
|
|
1.26
|
Year
|
|
3,766
|
|
|
|
|
|
4.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
798
|
|
|
|
|
|
0.94
|
Second
Quarter
|
|
327
|
|
|
|
|
|
0.38
|
Third
Quarter
|
|
647
|
|
|
|
|
|
0.76
|
Fourth
Quarter
|
|
1,056
|
|
|
|
|
|
1.24
|
Year
|
|
2,828
|
|
|
|
|
|
3.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
946
|
|
|
|
|
|
1.11
|
Second
Quarter
|
|
1,232
|
|
|
|
|
|
1.45
|
Third
Quarter
|
|
936
|
|
|
|
|
|
1.10
|
Fourth
Quarter
|
|
671
|
|
|
|
|
|
0.79
|
Year
|
|
3,785
|
|
|
|
|
|
4.45
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
421
|
|
|
|
|
|
0.50
|
After more than a century, Imperial continues
to be an industry leader in applying technology and innovation to
responsibly develop Canada's
energy resources. As Canada's
largest petroleum refiner, a major producer of crude oil and
natural gas, a key petrochemical producer and a leading fuels
marketer from coast to coast, our company remains committed to high
standards across all areas of our business.
SOURCE Imperial Oil Limited