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Oil and Gas

UPDATE 2-Imperial Oil expects higher 2022 capex as commodity prices recover

(Updates with throughput details, CEO quote)

Dec 17 (Reuters) - Canada’s Imperial Oil Ltd on Friday joined its rivals in forecasting higher capital expenditure next year, betting on a recent recovery in commodity prices from pandemic-led historic lows.

Canada’s biggest producers are responding to a rally in crude and natural gas prices by raising expenditure in 2022 to squeeze more barrels out of existing assets.

Imperial rivals Suncor Energy and Cenovus Energy said earlier this month they expect higher capital spend and output in 2022.

Imperial expects upstream production to be between 425,000 and 440,000 gross oil equivalent barrels per day, underpinned by strong operating performance in the company’s core oil sands assets and continued production growth at Kearl oil sands plant.

Chief Executive Officer Brad Corson said last month that the company has a number of projects planned for its Kearl plant that will increase production to 280,000 barrels per day (bpd) by 2025 from 265,000 bpd this year. (reut.rs/3sa7Xrj)

For downstream, throughput is expected to be between 395,000 bpd and 405,000 bpd with capacity utilization at 92% to 94%.

“Our plans also set the stage for continued volume growth in our core oil sands business in 2023 and beyond as we execute high-value, low-cost debottlenecking and other select growth projects,” Corson said on Friday.

Calgary-based Imperial, which is majority-owned by Exxon Mobil Corp, expects 2022 spending to be at C$1.4 billion ($1.09 billion), higher than 2021 estimates of C$1.1 billion.

$1 = 1.2821 Canadian dollars Reporting by Rithika Krishna and Arunima Kumar in Bengaluru; Editing by Vinay Dwivedi

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