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Imperial Oil Q3 profit falls 38 pct as oil prices squeeze refining

Thursday, 31 Oct 2013 | 11:41 AM ET

CALGARY, Alberta, Oct 31 (Reuters) - Imperial Oil Ltd , Canada's No. 2 oil producer and refiner, said on Thursday that third-quarter profit fell 38 percent as higher oil prices squeezed earnings from its refineries.

Net income totaled C$647 million ($618.9 million), or 76 Canadian cents per share, versus C$1.04 billion, or C$1.22, in the third quarter of 2012.

Higher oil prices and a narrowing discount for North American crude oil compared with the international Brent benchmark boosted profits for its oil production operations by 21 percent to C$604 million.

But the higher prices slashed earnings from Imperial's three Canadian refineries to C$46 million from C$536 million in the year-prior quarter.

The company, which is 69.6 percent owned by Exxon Mobil Corp , said its output of oil and natural gas liquids was unchanged in the quarter at 253,000 barrels per day despite new production from its recently opened Kearl oil sands mine.

Kearl added 21,000 barrels per day of oil, well below its planned 110,000 bpd of capacity. However a 21,000-bpd drop in the company's share of synthetic crude from the Syncrude oil sands project, to 57,000 bpd, offset the additional crude supply.

The company said all three production trains at its Kearl site were now operating and it expects to reach full capacity by year end.

Imperial said throughput at the company's refineries rose less than 1 percent to 451,000 bpd.

Revenue was up 3 percent to C$8.6 billion.

Imperial shares were down 40 Canadian cents to C$45.55 by late morning on the Toronto Stock Exchange.

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