imperial oil
Toronto symbol IMO, is Canada’s largest integrated oil company. It also operates over 1,900 retail gas stations under the “Esso” banner. ExxonMobil owns 69.6% of Imperial’s stock.
Imperial Oil is one of Canada’s largest and oldest energy companies, operating across the full oil and gas value chain—from exploring and producing crude oil and natural gas to refining fuels and marketing products under well-known brands like Esso and Mobil. Headquartered in Calgary, the company plays a major role in Canada’s energy sector, including significant involvement in oil sands development, petrochemicals, and transportation fuels, and it is majority-owned by ExxonMobil.
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Many investors are reading the news intently these days, in hopes of spotting a sign that the drop in oil prices has ended. They assume that if they get in at just the right moment, they’ll be able to take advantage of another of the violent upswings that the oil market has put on in the past, after a downturn like the one now underway. One investor wrote: “When oil dropped, I waited but not long enough. I bought $50,000 of Chevron and $40,000 of Imperial. Imperial is down about $4,000 and I have a $2,000 profit on Chevron. I’m thinking about selling the Chevron and maybe wait to see if it drops more later. I have to ride out the Imperial Oil.” This is a bad way to invest, but especially in a volatile, worldwide market like oil, and all the more so today. It’s easy to look at a long-term history of oil prices and detect what you feel is a clear, recurring pattern. However, these patterns occur in response to supply and demand in the market, and both are constantly changing....
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IMPERIAL OIL $44.63 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $37.8 billion; TSINetwork Rating: Average; Dividend yield: 1.3%; www.imperialoil.ca) is a major integrated oil company with oil sands projects in Alberta and conventional oil and gas operations across Western Canada. It also operates three refineries and 1,700 Esso gas stations. Imperial recently finished the second phase of its 71%-owned Kearl oil sands project in northern Alberta.
In the three months ended September 30, 2015, Imperial’s share of Kearl’s output was 192,000 barrels a day. That helped push its overall production up 25.7%, to 386,000 barrels of oil equivalent a day from 307,000 a year earlier.
However, lower oil prices cut its revenue by 25.9%, to $7.2 billion from $9.7 billion. Cash flow per share fell 32.9%, to $1.10 from $1.64. Imperial plans to keep expanding Kearl and Cold Lake, its two main oil sands properties. These projects will prosper when oil prices recover, and they should last for decades. Meanwhile, the company’s refineries cut its exposure to falling oil prices, as cheaper crude cuts the refineries’ input costs and increases their profit margins.
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In the three months ended September 30, 2015, Imperial’s share of Kearl’s output was 192,000 barrels a day. That helped push its overall production up 25.7%, to 386,000 barrels of oil equivalent a day from 307,000 a year earlier.
However, lower oil prices cut its revenue by 25.9%, to $7.2 billion from $9.7 billion. Cash flow per share fell 32.9%, to $1.10 from $1.64. Imperial plans to keep expanding Kearl and Cold Lake, its two main oil sands properties. These projects will prosper when oil prices recover, and they should last for decades. Meanwhile, the company’s refineries cut its exposure to falling oil prices, as cheaper crude cuts the refineries’ input costs and increases their profit margins.
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IMPERIAL OIL LTD. $42 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 848.0 million; Market cap: $35.6 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.3%; TSINetwork Rating: Average; www.imperialoil.ca) produced 386,000 barrels of oil equivalent a day in the three months ended September 30, 2015, up 25.7% from 307,000 a year earlier. That’s because Imperial recently completed the second phase of its 71%-owned Kearl oil sands project in northern Alberta. However, lower oil prices cut its revenue by 25.9%, to $7.2 billion from $9.7 billion. Cash flow per share fell 32.9%, to $1.10 from $1.64. Even so, Imperial plans to keep expanding Kearl and Cold Lake, its other main oil sands project. These operations, which should last decades, will prosper when oil prices rebound....
Imperial Oil continues to face low oil prices, but its diversified operations make it our top energy stock for conservative investors.
IMPERIAL OIL LTD. $42 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 848.0 million; Market cap: $35.6 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.3%; TSINetwork Rating: Average; www.imperialoil.ca) produced 386,000 barrels of oil equivalent a day in the three months ended September 30, 2015, up 25.7% from 307,000 a year earlier. That’s because Imperial recently completed the second phase of its 71%-owned Kearl oil sands project in northern Alberta. However, lower oil prices cut its revenue by 25.9%, to $7.2 billion from $9.7 billion. Cash flow per share fell 32.9%, to $1.10 from $1.64. Even so, Imperial plans to keep expanding Kearl and Cold Lake, its other main oil sands project. These operations, which should last decades, will prosper when oil prices rebound....
IMPERIAL OIL $44.63 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $37.8 billion; TSINetwork Rating: Average; Dividend yield: 1.3%; www.imperialoil.ca) is a major integrated oil company with oil sands projects in Alberta and conventional oil and gas operations across Western Canada. It also operates three refineries and 1,700 Esso gas stations. Imperial recently finished the second phase of its 71%-owned Kearl oil sands project in northern Alberta. In the three months ended September 30, 2015, Imperial’s share of Kearl’s output was 192,000 barrels a day. That helped push its overall production up 25.7%, to 386,000 barrels of oil equivalent a day from 307,000 a year earlier. However, lower oil prices cut its revenue by 25.9%, to $7.2 billion from $9.7 billion. Cash flow per share fell 32.9%, to $1.10 from $1.64. Imperial plans to keep expanding Kearl and Cold Lake, its two main oil sands properties. These projects will prosper when oil prices recover, and they should last for decades. Meanwhile, the company’s refineries cut its exposure to falling oil prices, as cheaper crude cuts the refineries’ input costs and increases their profit margins....
Multi-well pad drilling (or “octopus” drilling) is now common practice among major oil firms and is actively used by a number of companies we recommend, including Encana, Devon Energy, Cimarex, Pengrowth and Imperial Oil.
Traditionally, a company has needed a pad or land site for each well it drilled. However, multi-pad drilling lets producers drill as many as 50 wells from a single pad.
Here’s how the technology works: producers set up a well pad and then install a multi-well rig. The drill from that rig then literally “crawls” on hydraulic tentacles to numerous drill locations within its range. When drilling at each location is completed, it takes just two hours for the rig to move to a new location. With traditional horizontal drilling methods, it takes about five days to move from pad to pad and start drilling a new well.
The practice of placing several wells on one pad has many benefits:
Traditionally, a company has needed a pad or land site for each well it drilled. However, multi-pad drilling lets producers drill as many as 50 wells from a single pad.
Here’s how the technology works: producers set up a well pad and then install a multi-well rig. The drill from that rig then literally “crawls” on hydraulic tentacles to numerous drill locations within its range. When drilling at each location is completed, it takes just two hours for the rig to move to a new location. With traditional horizontal drilling methods, it takes about five days to move from pad to pad and start drilling a new well.
The practice of placing several wells on one pad has many benefits:
- It reduces the impact of drilling multiple wells, which is especially important in populated areas.
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