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iCrowdNewswire Nov 3, 2020 2:47 PM ET

International Petroleum Corporation Third Quarter 2020 Financial Results and Sustainability Report

International Petroleum Corporation Third Quarter 2020 Financial Results and Sustainability Report

iCrowd Newswire - Nov 3, 2020

International Petroleum Corporation  released its financial and operating results and related management’s discussion and analysis for the nine months ended September 30, 2020. IPC also announces the release of its first Sustainability Report, which details the Corporation’s environmental, social, and governance (“ESG”) performance.

Business Update

Q3 2020 Financial and Operational Highlights

  Three months ended
September 30
  Nine months ended
September 30
USD Thousands 2020 2019   2020 2019
Revenue 95,346 131,437   220,811 408,214
Gross profit / (loss) 5,557 23,487   (23,416) 109,659
Net result 8,850 6,330   (32,691) 65,216
Operating cash flow 37,181 69,504   73,404 229,056
Free cash flow 22,766 9,989   (19,229) 84,809
EBITDA 34,251 68,885   65,447 225,160
Net Debt 322,092 207,778   322,092 207,778

Mike Nicholson, IPC’s Chief Executive Officer, commented,

“During the third quarter of 2020, we began to see some positive results from the production curtailments implemented by OPEC+ and other oil producers in response to the collapse in oil demand driven by the Covid-19 pandemic. Those actions managed to flatten the curve of inventory builds towards the end of the second quarter. This in turn led to the oil market moving into deficit during the third quarter with a draw down in inventory levels as the rebalancing process commenced. As a result of the market tightening, average Brent oil prices increased from second quarter levels of around USD 30 per barrel to above USD 40 per barrel during the third quarter.

Clearly though, uncertainties remain with the onset of a second wave of Covid-19 infections. The full impact of new localized confinement measures being introduced creates a degree of uncertainty with respect to the pace and magnitude of the recovery in oil demand. For a sustained recovery in oil prices, discipline and compliance on the supply side measures announced by OPEC+ will be essential, particularly when considering the timing of easing of the supply curtailments.

As a result, we believe it is prudent to exercise caution with respect to future capital expenditure and growth plans, and we have no plans to increase our reset 2020 expenditure program. We expect to set a budget for 2021 with a focus on free cash flow generation and debt reduction.

Update of 2020 Business Plan
Given that IPC operates the majority of our assets, during the first half of 2020 we had the financial and operational flexibility to react swiftly to the situation and to positively position IPC to navigate through this period of low commodity prices. We reduced all remaining discretionary 2020 expenditures. In addition, during the second quarter of 2020, we took the decision to temporarily curtail oil production from those fields that were not expected to generate positive cash flows at the low pricing levels we were experiencing.

With the improvement in our business outlook, and in particular the strengthening of Canadian crude oil prices, we took the decision in late Q2 2020, to progressively bring back on stream our oil production from our Suffield Oil asset and our Onion Lake Thermal asset.

Third Quarter Performance
Our average third quarter net production of 41,800 boepd was above our Q2 2020 guidance which gives us average net production of 41,200 boepd for the first nine months of 2020. As a result of this strong recovery in production, we now expect IPC’s full year 2020 average net production to be above 41,000 boepd.

Operating cash flow generation for the third quarter amounted to USD 37.2 million, ahead of our Q2 2020 forecast as a result of stronger oil prices and higher than forecast production. Moreover, as a result of our spending reductions, operational choices and hedging program, IPC generated approximately USD 23 million of free cash flow during the third quarter of 2020, yielding greater than 8%.

Sustainability Reporting
Responsible operatorship and ensuring that we adhere to the highest principles of business conduct have been an integral part of how we do business since the creation of IPC in 2017. Over the past three years, IPC has rapidly grown our business with the completion of three acquisitions in Canada as well as significant investments in our French and Malaysian businesses.

In parallel, we have made a concerted effort to further develop and improve our sustainability strategy. An important part of this journey involves the measurement and transparent reporting of a broad range of ESG metrics. We are very pleased that IPC is today presenting to our stakeholders for the first time, our inaugural Sustainability Report.

The Sustainability Report 2019 details the Corporation’s ESG performance. The Sustainability Report 2019 advances the Corporation’s non-financial disclosures and provides stakeholders with relevant operational and sustainability context in which IPC operates, as well as the Corporation’s management approach and performance with respect to these areas. The report is available on IPC’s website at

Highlights of IPC’s sustainability performance for 2019 include:

In Q3 2020, IPC joined the United Nations Global Compact, a leading global initiative for good corporate citizenship. We support and are committed to upholding the 10 Principles of the UN Global Compact on human rights, labour, environment and anti-corruption, and will report on progress on an annual basis.”

International Petroleum Corp. (IPC) is an international oil and gas exploration and production company with a high quality portfolio of assets located in Canada, Malaysia and France, providing a solid foundation for organic and inorganic growth. IPC is a member of the Lundin Group of Companies. IPC is incorporated in Canada and IPC’s shares are listed on the Toronto Stock Exchange (TSX) and the Nasdaq Stockholm exchange under the symbol “IPCO”.

For further information, please contact:

Rebecca Gordon
VP Corporate Planning and Investor Relations
Tel: +41 22 595 10 50


Robert Eriksson
Media Manager
Tel: +46 701 11 26 15

Contact Information:

Robert Eriksson
Media Manager
Tel: +46 701 11 26 15

Tags:    Wire, Disclosure Newswire, United States, English