02) PROFIT GUSHER CONTINUES FOR CANADIAN BIG OIL FIRMS

(The following article is from the August 1-31, 2008, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $25/year, or $12 low income rate; for U.S. readers - $25 US per year; other overseas readers - $25 US or $35 CDN per year. Send to: People's Voice, c/o PV Business Manager, 133 Herkimer St., Unit 502, Hamilton, ON, L8P 2H3.)

PV Vancouver Bureau

Second-quarter profits were up substantially for Big Oil as fuel costs skyrocketed for consumers. The average global price of oil during April through June was $123/barrel, a 90% climb over the spring quarter of 2007. Natural gas prices in Canada also surged, averaging $9.68 per gigajoule, a 44 per cent gain from 2007. Five of the biggest Canadian-based energy firms racked up a total of $5.3 billion for the three month period, as they ramp up oil sands production and in one case, plans to gain a share in the plunder of occupied Iraq's massive oil fields.

     Husky Energy kicked off the oil patch's quarterly financial reporting season last month, with profits, cash flow and revenues climbing to new records. Husky reported profit of $1.36 billion ($1.61 a share) in the three months ending June 30, an increase of 89 per cent over the same period last year. Even though the company's oil and gas production dropped because of maintenance and weather conditions at its East Coast operations, revenue was $7.2 billion, up 128 per cent.

     Petro-Canada's net income for April-June 2008 rose to $1.5 billion, up 77 percent from $845 million for the same three months of 2007. These results of $3.10 per share beat the expectations of market speculators, who had forecast an average of $2.50/share. Second-quarter revenue for Petro-Canada was $7.6-billion, up 38 per cent from $5.5-billion in 2007.

     Originally publicly-owned, Petro-Canada is now the country's 4th biggest refiner and retailer, with extensive oil sands holdings, and has retooled its Edmonton refinery to run crude derived from such resources exclusively.

     Suncor Energy, Canada's No. 2 oil sands producer, reports that record crude prices boosted its second-quarter profit by 12 percent to $829 million, despite a decline in production levels. At 89 cents per share, the operating profit surpassed analysts' average forecast of 79 cents. Suncor's oil sands project produced 174,600 barrels a day in the quarter, down 14 percent from 2007 levels as a maintenance shutdown dragged on longer than expected.

     EnCana Corp., Canada's largest natural-gas producer, said its second-quarter profit fell 16 percent over 2007. The company had pre-sold much of its current output at last year's lower prices, but Encana's net income was still a startling $1.22 billion, or $1.63 per share.

     Oil producer Nexen Inc. saw quarterly earnings rise 3% to $380 million (70 cents per share) up from $368 million a year earlier. Total sales grew to $2.07 billion from $1.4 billion during the same quarter of 2007,  a rise of 48%.

     Nexen's cash flow exceeded capital investment for the first six months of the year by $500 million, and expects that figure to grow over the balance of the year. The proceeds will be invested, at least partly in Iraq. Nexen is the lone Canadian company among 35 international firms to qualify for bidding rights on eight massive oil fields in the occupied country.

     "We were the only Canadian company to successfully pre-qualify in a group that contains a number of the world's major oil and gas companies," Nexen CEO Charlie Fischer said in a statement. "This builds on our strength in the Middle East and could present us with long term opportunities in one of the world's richest resource basins."

     Nexen, which already owns wells in the Middle East as well as North America, the U.K., and Africa, said additional money would be spent on drilling on gas trapped in shale formations in northeast British Columbia.