International Petroleum meets year-end projections despite bumpy road in 2020

By COLLIN GALLANT on February 10, 2021.

cgallant@medicinehatnews.com@CollinGallant

International Petroleum Corp. wound up meeting original year-end production targets in 2020, and remained cash positive in a rocky year that saw curtailments and plunging revenue as oil prices were rocked in the spring.

The global producer, with major operations centred at Suffield, said Tuesday in its year-end financial report it is maintaining discipline as prices improve.

“2020 was certainly the year when we were called upon to face unprecedented challenges,” said CEO Mike Nicholson. “IPC believes that we are very well positioned to benefit from the recovery.”

Full-year revenue fell 40 per cent to US$324.2 million, leading to a net loss of US$78 million, compared to a US$103.6-million profit in 2019.

The company’s stated cost of production of heavy oil from Suffield was lowered to the US$12 per barrel range, though prices fell as low as C$5 for Western Canadian Select for times in 2020.

Demand fell when motorists essentially parked cars during the early pandemic, exacerbating a price decline fuelled by global oversupply.

At that time IPC Alberta was considering shutting in up to one-third its production in the province, but progressively brought levels back to normal by year end.

In June 2020, the company announced it would scale back capital spending US$35 million.

The company-wide 2021 capital program, worth US$37 million, is heavily weighted to Canadian assets, including a continued gas optimization program at Suffield.

That and work at the company’s Onion Lake thermal facility in northern Alberta will result in a five per cent increase in production, to 43,000 barrels per day, the company predicted.

“We do not expect to see a return to organic production growth until we see stronger evidence of a more balanced market,” said Nicholson.

Down year for Goodyear

Goodyear Tires sold 13.7 million fewer tires in North and South America during 2020, but still broke even in the segment, the global company stated in year-end financial reports released Tuesday.

The net loss across the company was US$1.3 billion, though the Americas posted just $9 million in operating income and a 0.1 per cent margin. The same figures in 2019 were $550 million and 6.9 per cent.

Results come after drivers bought fewer replacements during the year and companies delayed fleet spending, though outlook improved toward the end of 2020.

Major capital projects in the year were the modernizations of two facilities in Germany and costs to close down its plant in Gadsen, Ala.