Canada’s Imperial Oil IMO-T +5.26%increase reported a 72 per cent drop in second-quarter profit on Friday as maintenance activity hit its production while a slump in energy prices further dented earnings.
Global oil prices dropped in the second quarter from a year earlier, pressured by a banking crisis that saw several large lenders fail and fears of a looming recession that crimped demand.
Imperial said its average realized prices for Western Canada Select, the benchmark Canadian crude, fell 39 per cent to $58.49.
The company, majority-owned by Exxon Mobil XOM-N -1.93%decrease, said its second-quarter upstream production declined 12 per cent to 363,000 barrels of oil equivalent per day (boepd), hurt by maintenance-related stoppages.
The company’s crude utilization stood at 90 per cent in the reported quarter, lower than last year’s 96 per cent due to the impact of the planned turnaround at its Strathcona refinery.
This pushed its quarterly total downstream throughput lower by 6 per cent to 388,000 barrels per day (bpd).
“With substantial turnaround activity now behind us, we anticipate strong production in the second half of 2023,” CEO Brad Corson said.
The company reported a net income of $675-million, or $1.15 per share, for the quarter ended June 30, down from $2.4-billion or $3.63 per share, a year earlier.
Imperial added that it has completed construction work for expanding the existing seepage interception system at its Kearl oil sands mine in northern Alberta.
In May, Canada’s federal environment ministry had opened a formal investigation into a months-long leak at Kearl of tailing, a toxic mining by-product containing water, silt, residual bitumen and metals.
Imperial also said it had started construction at Strathcona renewable diesel project.
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