Imperial Oil profit rises on higher refining margins

Thu Nov 1, 2012 10:07am EDT
 
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(Reuters) - Imperial Oil Ltd IMO.TO, Canada's second-largest integrated oil company, reported a 21 percent rise in third-quarter profit due to higher mid-continent refining margins.

Imperial said mid-continent industry refining margins remained strong at C$270 million ($270.1 million) in the quarter.

Refining margins have improved as companies benefit from processing cheaper grades of crude oil from Canada as well as shale basins like the Eagle Ford in south Texas.

Exxon Mobil Corp (XOM.N: Quote), which owns 69.6 percent of Imperial, reported stronger-than-expected earnings earlier on Thursday, also helped by higher margins in its refining business.

Imperial's net income rose to C$1.04 billion, or C$1.22 per share, from C$859 million, or C$1.01 per share, a year earlier.

Total revenue and other income rose 5 percent to C$8.34 billion.

Imperial is best known for its dominant position in the Alberta oil sands, which it is expanding with its new Kearl project in northern Alberta, expected to start up before the end of the year.

The company said on Thursday that the Kearl expansion project was 20 percent complete at the end of the third quarter.

Production averaged 285,000 barrels of gross oil-equivalent per day, compared with 296,000 barrels in the year-ago period. Output was lower due mainly to divestments of producing properties and maintenance, the company said.

Imperial said on Wednesday that all units at its 121,000 barrel per day refinery at Sarnia, Ontario, were returning to normal service after being shut a day earlier due to a power outage caused by superstorm Sandy.

Shares of Imperial were up slightly at C$44.48 on the Toronto Stock Exchange on Thursday. They have fallen about 2.6 percent since the beginning of this year. ($1 = 0.9995 Canadian dollars) (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila, Roshni Menon)