IMPERIAL OIL LIMITED
Nine months 2018 vs. nine months 2017
Net income in the first nine months of 2018 was $1,461 million, or $1.79 per share on a diluted basis, an increase of $834 million compared to a net income of
$627 million or $0.74 per share in the first nine months of 2017.
Upstream net income was $172 million in the first nine months of 2018, an increase of
$397 million compared to a net loss of $225 million from the same period of 2017. Improved results reflect the impact of higher Canadian crude oil realizations of about $670 million and higher Kearl volumes of about $120 million,
partially offset by the impact of lower Cold Lake and Syncrude volumes of about $170 million, higher operating costs of about $120 million and higher royalties of about $60 million.
West Texas Intermediate averaged US$66.77 per barrel in the first nine months of 2018, up from US$49.40 per barrel in the same period of 2017. Western Canada Select
averaged US$44.98 per barrel and US$37.57 per barrel respectively for the same periods. The WTI / WCS differential widened to approximately US$22 per barrel in the first nine months of 2018, from around US$12 per barrel in the same period of 2017.
The Canadian dollar averaged US$0.78 in the first nine months of 2018, an increase of about US$0.01 from the same period of 2017.
Imperials average Canadian dollar realizations for bitumen and synthetic crudes increased generally in line with the North American benchmarks, adjusted for
changes in the exchange rate and transportation costs. Bitumen realizations averaged $45.04 per barrel for the first nine months of 2018, an increase of $7.22 per barrel versus 2017. Synthetic crude realizations averaged $83.66 per barrel, an
increase of $19.29 per barrel from the same period of 2017.
Gross production of Cold Lake bitumen averaged 145,000 barrels per day in the first nine months of
2018, compared to 161,000 barrels per day from the same period of 2017. Lower volumes were primarily due to planned maintenance and production timing associated with steam management.
Gross production of Kearl bitumen averaged 202,000 barrels per day in the first nine months of 2018 (144,000 barrels Imperials share) up from 179,000 barrels per
day (127,000 barrels Imperials share) from the same period of 2017. Increased 2018 production reflects improved operational reliability associated with ore preparation, enhanced piping durability and feed management.
During the first nine months of 2018, the companys share of gross production from Syncrude averaged 53,000 barrels per day, compared to 56,000 barrels per day
from the same period of 2017. Syncrude
year-to-date
production was impacted by a site-wide power disruption that occurred on June 20 resulting in a complete
shutdown of all processing units. Production was progressively restored throughout the third quarter 2018 and all cokers were back
on-line
by
mid-September.
Production
in 2017 was impacted by repairs associated with the Syncrude Mildred Lake upgrader fire.
Downstream net income was $1,224 million, an increase of
$474 million versus the prior year. Higher earnings primarily reflect stronger margins of about $910 million, partially offset by the impact of increased planned turnaround activity and reliability events of about $190 million, the
absence of the $151 million gain on the sale of a surplus property in 2017, and a
non-cash
impairment charge of $33 million associated with the Government of Ontarios revocation of its carbon
emission cap and trade regulation.
Refinery throughput averaged 386,000 barrels per day in the first nine months of 2018, up from 381,000 barrels per day from the
same period of 2017. Capacity utilization increased to 91 percent from 90 percent in the same period of 2017.
Petroleum product sales were 503,000
barrels per day in the first nine months of 2018, up from 492,000 barrels per day from the same period of 2017. Sales growth continues to be driven by optimization across the full downstream value chain, and the expansion of Imperials
logistics capabilities.
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