CALGARY - Energy giant Imperial Oil Ltd. said Thursday its third-quarter profit more than doubled on strength at its Cold Lake and Syncrude oilsands operations in Alberta and that construction on a new oilsands mine at Kearl is nearing completion.
Calgary-based Imperial (TSX:IMO) earned $859 million, or $1.01 per share, in the three months ended Sept. 30, up from $418 million or 49 cents per share, in the same period a year earlier.
Analysts polled by Thomson-Reuters were on average expecting Imperial to earn 96 cents per share during the quarter.
"Strong market conditions were captured by our solid operating performance in the upstream, downstream and chemical sectors," president and CEO Bruce March said in a statement.
Imperial said higher gasoline refining margins contributed about $270 million to the company's bottom line in the latest quarter, while higher oil prices added $190 million.
Higher Cold Lake bitumen production increased profits by $90 million and additional Syncrude sales added $45 million. Imperial has a 25-per-cent stake in Syncrude, the largest oilsands mining project in the world.
Its downstream operations, which comprise refineries and a chain of 1,850 Esso-branded retail stations from coast to coast, benefited from less scheduled maintenance downtime.
Total revenues for the period rose to $7.9 billion from a last year's $5.9 billion.
Cold Lake saw record quarterly production averaging 162,000 barrels a day, while Imperial's share of Syncrude production rose to 75,000 barrels from 66,000 barrels.
First Asset Investment Management portfolio manager John Stephenson said Imperial showed "good, solid performance" during the quarter.
In Thursday trading on the TSX, Imperial shares rose 97 cents to $42.90, a gain of more than two per cent.
Imperial said construction on the first 110,000-barrel-per-day phase of its Kearl oilsands mine is 79 per cent complete, and remains on track to begin production in late 2012.
The company faced delays in obtaining permits to transport gargantuan pieces of equipment along secondary roads through Idaho and Montana to the Kearl mine site north of Fort McMurray, Alta.
In response, Imperial broke apart the modules so they are small enough to travel along interstate highways.
"Transport increased through the quarter and reassembly is underway," the company said.
Stephenson said he's optimistic Kearl will remain on track to start up late next year.
"It's just waiting for it to come online, which will be the next leg up for the stock, and the next leg up for the story," he said.
"I'm optimistic they've got it, and certainly they're an unbelievably good operator. I have no doubt it will get done, and it will be done reasonably well."
In May, Imperial said the pricetag for the first phase is expected to be $10.9 billion, a substantial increase from its earlier estimate of $8 billion.
When the Calgary-based firm announced in 2009 that it would build the Kearl mine, it expected three phases of roughly the same size.
But last fall, Imperial reworked those plans. Now, it aims to construct the mine in two phases, with a project in between to unlock spare capacity from the first phase. The price increase reflects the fact that Imperial is investing in equipment now so it won't have to do so later.
The amount of oil that Kearl will eventually be able to produce is unchanged, as are the expected costs for the entire 345,000 barrel-per-day development.
Imperial is about 70-per-cent owned by Houston-based energy heavyweight Exxon Mobil Corp. (NYSE:XOM),
Imperial is the lead partner on the long-stalled Mackenzie Gas Project, which would bring natural gas from the Northwest Territories to southern markets via a 1,220-kilometre pipeline.
A formal regulatory process finally wrapped in March, after several years of delay. Imperial has said the absolute soonest the pipeline could start up is 2018.
Besides its Esso-branded fuel stations across the country, Imperial also has big refineries in Alberta and Ontario.
Also Thursday, Imperial parent Exxon Mobil reported its net profits rose 41 per cent in the third quarter as higher oil and natural gas prices made up for lower production.
The world's largest publicly traded oil company earned US$10.33 billion, or $2.13 per share. That compared with $7.35 billion, or $1.44 per share, a year earlier.
Revenue rose 32 per cent to US$125.3 billion.