Imperial Oil Limited (IMO - Free Report) has halted production at its Kearl oil sands mining operation in northern Alberta following a partial shutdown of the Inter pipeline-owned Polaris diluent conduit due to a spill near Fort McMurray. The leak was detected in the early morning of Aug 29, 2020. Diluents are fluids used to thin heavy oil so it flows smoothly.
The whole Polaris system can transmit 865,000 barrels of oil daily between the oil sands at Kearl Lake, run by Imperial Oil and Lamont, Alberta.
Management believes that the company’s facilities will reactivate its operations soon after the pipeline is back online and the diluent supply is restored. Temporarily, the effect of this operational interruption and the schedule for resuming activities are unknown.
The company intends to carry out the shutdown in a protected and organized manner as the safety of its staff, contractors and the communities in which it operates continues to be its primary focus. Meanwhile, Imperial Oil is finding various ways to minimize the possible operational consequences.
Management refrained from providing an update on the extent of production is being side-lined. However, per a National Bank analyst Travis Wood, Kearl was estimated to produce an average of 157,000 barrels per day of bitumen in the ongoing quarter.
Founded in 1880, this Calgary-based Imperial Oil Limited is one of the largest integrated oil companies of Canada, mainly engaged in the oil and gas production, petroleum products refining and marketing and chemical business. It is Canada’s largest jet fuel supplier and a major producer of asphalt.
Zacks Rank & Key Picks
Imperial Oil currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the same space are Murphy USA Inc. (MUSA - Free Report) , CNOOC Limited (CEO - Free Report) and SilverBow Resources Inc. (SBOW - Free Report) , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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