April 25, 2013 / 1:02 PM / in 5 years

CORRECTED-UPDATE 1-Imperial Oil profit falls on lower crude prices

(Removes reference to Kearl project being equally owned with Exxon in fifth paragraph. Kearl is 79 percent owned by Imperial Oil.)

* First-qtr EPS $0.94 vs C$1.19 year earlier

* Total revenue and other income rises 6 percent

* Says start-up of first phase of Kearl oil sands project imminent

April 25 (Reuters) - Imperial Oil Ltd, Canada’s No. 2 oil producer and refiner, reported a 21 percent fall in first-quarter profit due to lower crude prices and increased refinery maintenance.

The company said the start-up of the first phase of its Kearl oil sands project in northern Alberta is imminent and the sales of Kearl blend are expected to begin in the third quarter.

Imperial, 69.6 percent owned by Exxon Mobil Corp, has been struggling to overcome start-up problems at its 110,000 barrel per day Kearl project.

The C$12.9 billion project was originally expected to begin producing by the end of 2012, but has yet to produce any bitumen.

The 79 pecent-owned Kearl project will use production technology that allows the oil sands’ tar-like bitumen to flow to market without the need for upgrade.

The project has been plagued by cost overruns that pushed the budget nearly two-thirds above Imperial’s initial 2009 forecast of C$7.9 billion estimate.

Imperial’s net income in the quarter fell to C$798 million ($777 million), or 94 Canadian cents per share, from C$1.02 billion, or C$1.19 per share, a year earlier.

Total revenue and other income rose 6 percent to C$8.01 billion.

Imperial’s gross production fell 2 percent to average 284,000 barrels of oil equivalent per day.

Cash flow from operations, a key indicator of the company’s ability to pay for new projects and drilling, fell to C$597 million from C$1.05 billion a year earlier.

Prices for most of Imperial’s liquid output are based on that of West Texas Intermediate (WTI) crude oil.

The company said the average WTI crude oil price in U.S. dollars was lower by $8.67 per barrel, or about 8 percent, in the first quarter, compared with a year earlier. ($1 = 1.0273 Canadian dollars) (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sreejiraj Eluvangal)

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