Top Canada oil execs push back against Trudeau's 'unrealistic' emissions plan

Jul. 29, 2022 7:02 PM ETImperial Oil Limited (IMO)CVE, MEGEFBy: Carl Surran, SA News Editor175 Comments

3d illustration of barrels with oil

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Canadian Prime Minister Justin Trudeau's demand for sharp emissions cuts from the energy sector to reach net-zero amounts to government overreach, Imperial Oil (NYSE:IMO) CEO Brad Corson said Friday according to Bloomberg.

"It is very aggressive and stretches the capability of what is technically and economically feasible," Corson said on the company's earnings conference call.

"We share the government's objective to tackle climate change in a very proactive manner," Corson said, but urged caution "that we bring the right balance to environmental improvements with continued oil supply."

Trudeau's goal of cutting emissions from the energy sector by 42% by 2030 exceeds the Canadian oil industry's proposal to reduce emissions by 30% - a plan that relies heavily on carbon capture technology to reduce oil sands pollution.

MEG Energy (OTCPK:MEGEF) CEO Derek Evans told analysts on his company's earnings call that the government's goal is "unrealistic... I don't know how we get to 42%."

"Ultimately, the risk could be a cut in production from Canada at a time when these resources are just incredibly, desperately needed worldwide," Cenovus (CVE) CEO Alex Pourbaix said during an investor call Thursday.

Imperial (IMO) rose 4% in Friday's trading after reporting Q2 net income rose more than six-fold Y/Y to C$2.41B, or C$3.63/share, as revenues more than doubled to C$17.3B.

The company said its upstream production of 413K gross boe/day was the best Q2 total in more than 30 years; gross production at the Kearl oil sands project recovered to 224K bbl/day, and is expected to top 280K gross bbl/day in H2.

Imperial Oil (IMO) is undergoing additional share repurchases that should continue to add to the company's value as a long-term investment, The Value Portfolio writes in a bullish analysis posted on Seeking Alpha.

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