Canada's Imperial Oil posts lower quarterly profit; announces first production from renewable diesel plant
The Calgary, Alberta-based company — which is majority-owned by U.S. oil and gas major ExxonMobil (XOM.N), opens new tab — also announced the first production of renewable diesel from its new Strathcona plant near Edmonton, Alberta.
On a conference call with analysts, Imperial CEO John Whelan said the company completed construction and commissioning of the Strathcona facility, which is the largest renewable diesel plant in Canada, during the second quarter.
The C$720-million facility will use vegetable and agricultural oils as feedstock to produce lower-emission fuels for Canada's transportation sector.
The facility was designed to have the capacity to process more than 1 billion litres of renewable diesel annually, but Whelan said production levels will depend on supplier capabilities as the facility ramps up. At the time of the project's announcement in 2021, Imperial said it planned to source "blue hydrogen," or hydrogen produced from natural gas using carbon capture and storage, for use at the facility.
While the company has sufficient "grey hydrogen" — which is produced from natural gas without the use of carbon capture and storage, resulting in higher greenhouse gas emissions — to start up and operate the facility, longer-term hydrogen supplies are uncertain.
"The viability of further hydrogen supplies and blue hydrogen will impact the speed of the ramp-up of the asset," Whelan said.
Benchmark Brent crude prices were lower during the April-June quarter compared to a year earlier, pressured by weak global demand, market volatility due to tariffs, and increased oil supply from OPEC+.
Imperial said its net income fell to C$949 million ($684.31 million), or C$1.86 per share, in the quarter ended March 31, from C$1.13 billion, or C$2.11 per share, a year earlier.
Imperial's total throughput volumes, or the amount of crude processed, fell to 376,000 barrels per day during the second quarter, from 387,000 bpd a year ago.
The company's total refinery utilization stood at 87%, down from 89% in the same quarter last year.
Upstream production for the April-June quarter was 427,000 gross barrels of oil equivalent per day, higher than the 404,000 gross boepd a year earlier.
($1 = 1.3868 Canadian dollars)
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