Integrated energy company saw declines in both downstream and upstream operations
CALGARY—Imperial Oil Ltd. says its fourth-quarter profit was down 36 per cent compared with a year before, reflecting a number of operational issues as well as the dramatic decline in crude oil prices.
Imperial’s net income for the three months ended Dec. 31 was $671 million, down from $1.07 billion in the fourth quarter of 2013.
The integrated oil and gas company says the fourth-quarter profit was down both at its upstream business—which includes oilsands and conventional oil and gas production—and at the downstream business that includes refining and retail operations.
Imperial announced last week it will be assessing the possible sale of its 500 gas stations to partners, a process that will take six to eight months.
On the production side, Imperial has been continuing to operate the Cold Lake oilsands and ramp up the newer Kearl oilsand mine but output of oil and gas in the fourth quarter declined from a year earlier due to operational and maintenance issues at Cold Lake and Syncrude as well as Imperial’s divestments of conventional oil assets in the first half of 2014.
Imperial says it’s monitoring the recent dramatic decline in global crude prices and expects to reduce capital and exploration spending by about $1.6 billion—dropping to an estimated $4 billion in 2015 from $5.65 billion in 2014.
For the full year, Imperial’s net income was $3.79 billion—up from $2.83 billion in 2013 and second-highest since the company was formed more than a century ago.