PetroCanada boosts production in quarter; but profits fall with prices

Allen Baker, PNA contributing writer

PetroCanada’s net earnings dropped nearly 70 percent for the first quarter, but startup of the Terra Nova project on Canada’s East Coast brought an increase in production.

Earnings for the Calgary-based company came in at $88 million (Canadian) for the quarter, down from C$282 million a year ago. In the fourth quarter, operating earnings were C$71 million, but that included a C$15 million charge against earnings due to the bankruptcy filing of Enron Corp.

Lower prices drove upstream earnings down 74 percent to C$67 million in the first quarter of this year. Downstream, earnings were cut in half to C$45 million, but the company did show a profit in that segment, unlike others in the industry. Refining volume was essentially flat.

Daily production was 229,700 barrels of oil equivalent, up 14 percent as Terra Nova came on line. The field produced an average of 33,900 barrels daily after oil began to flow Jan. 20, and that figure is expected to grow to 42,000 barrels daily by the end of the year. Western Canada’s gas flow averaged 731 million cubic feet daily, down a bit from the 2001 quarter after some non-core properties were sold.

Revenues for the quarter were C$1.71 billion, down a third from C$2.56 billion a year ago.

The figure was down just slightly from the fourth quarter’s C$1.77 billion.