PrairieSky Royalty reports lower second-quarter crude oil production

PrairieSky Royalty reports lower second-quarter crude oil production

CALGARY — Oil production is beginning to recover after it was curtailed by an average of 30 per cent in the second quarter due to low crude prices, PrairieSky Royalty Ltd. said Tuesday.

The Calgary-based company, which earns revenue by sharing in production from lands for which it holds the petroleum mineral rights, said it produced 18,670 barrels of oil equivalent per day in the three months ended June 30, down 16 per cent from the first quarter.

No new wells were started on its properties in the three months ended June 30 but there are signs that activity will pick up later this year as oil prices strengthen, said CEO Andrew Phillips on a conference call.

“We do expect greater activity than we would have two months ago… I don’t know that will show an effect for us in the back half of this year, but it certainly will improve in 2021,” he said.

PrairieSky’s production shortfalls are expected to be a common theme as larger oilpatch players including Suncor Energy Inc. and Cenovus Energy Corp. roll out second quarter results later this week.

Producers in Western Canada are estimated to have shut down wells producing more than 800,000 barrels per day of oil at times in the second quarter due to plunging prices amid the economic downturn associated with the COVID-19 lockdowns.

Crude oil production at PrairieSky fell by 30 per cent to 6,035 barrels per day over the quarter from 8,740 bpd in the year-earlier period as its average realized price fell to C$24.31 per barrel from C$65.48.

PrairieSky says as much as 40 per cent of its oil output was curtailed in May.

Natural gas output was down 7.5 per cent from the second quarter of 2019 despite the average price rising from 74 cents per thousand cubic feet to $1.39.

The company’s second quarter production revenue was $25.1 million, off by 39 per cent compared with the first quarter of 2020 and 60 per cent from the second quarter of 2019.

PrairieSky reported a net loss of $400,000 or zero cents per share in the quarter, compared with a net profit of $44 million or 19 cents in the year-earlier period, largely matching analyst expectations.

Its stock rose by as much as seven per cent to $8.90 on the Toronto Stock Exchange on Tuesday.

The company reported completing $6 million in royalty interest acquisitions in northeastern B.C. during the quarter and added it is continuing to look for expansion opportunities.

This report by The Canadian Press was first published July 21, 2020.

Companies in this story: (TSX:PSK, TSX:SU, TSX:CVE)

The Canadian Press

crude oil

Just Posted

kids
Lots of fun and learning to be found at the brand new ‘Market Buds’ program

Activities to run the gamut from outdoor games, treasure hunts and storytelling to seed planting and interactive games

Police officers and their dogs undergo training at the RCMP Police Dog Services training centre in Innisfail, Alta., on Wednesday, July 15, 2015. Mounties say they are searching for an armed and dangerous man near a provincial park in northern Alberta who is believed to have shot and killed a service dog during a police chase. THE CANADIAN PRESS/Jeff McIntosh
RCMP search for armed man in northern Alberta after police dog shot and killed

Cpl. Deanna Fontaine says a police service dog named Jago was shot during the pursuit

Alberta now has 2,336 active cases of COVID-19, with 237 people in hospital, including 58 in intensive care. (Black Press file photo)
Red Deer down to 73 active cases of COVID-19, lowest since early November

The Central zone has 253 active cases of the virus

Stettler
Stettler and area’s ninth annual Eco Excellence Awards have been announced

This year’s recipients include Louise Damen, Joanne Pinder, Jan and Bob Richardson and the Jewel Theatre

People line up to get their COVID-19 vaccine at a vaccination centre, Thursday, June 10, 2021 in Montreal. THE CANADIAN PRESS/Ryan Remiorz
Vaccines, low COVID case counts increase Father’s Day hope, but risk is still there

Expert says people will have to do their own risk calculus before popping in on Papa

A lotto Max ticket is shown in Toronto on Monday Feb. 26, 2018.THE CANADIAN PRESS
No winning ticket sold for Friday’s $70 million Lotto Max jackpot

The huge jackpot has remained unclaimed for several weeks now

Canadian Prime Minister Justin Trudeau is seen during a joint news conference following the EU-Canada Summit, in Brussels, Belgium, Tuesday June 15, 2021. Trudeau says Canada is on track now to have 68 million doses delivered by the end of July, which is more than enough to fully vaccinate all 33.2 million Canadians over the age of 12. THE CANADIAN PRESS/Adrian Wyld
Vaccine deliveries enough to fully vaccinate all eligible Canadians by end of July

Three in four eligible Canadians now have their first dose, nearly one in five fully vaccinated.

Chief Public Health Officer Theresa Tam listens to a question during a news conference, in Ottawa, Tuesday, Jan. 12, 2021. The number of confirmed COVID-19 cases attributed to the highly contagious Delta variant grew in Canada this week. THE CANADIAN PRESS/Adrian Wyld
Canada’s public health agency reports spike in confirmed cases of Delta variant

More than 2,000 cases of the variant confirmed across all 10 provinces and in one territory

The federal government says it wants to ban most flavoured vaping products in a bid to reduce their appeal to youth. THE CANADIAN PRESS/AP-Craig Mitchelldyer
Health Canada proposes ban on most vaping flavours it says appeal to youth

If implemented, the regulations would restrict all e-cigarette flavours except tobacco, mint and menthol

The Montreal Police logo is seen in Montreal on Wednesday, July 8, 2020. Some Quebec politicians are calling for an investigation after a video was released that appears to show a Montreal police officer with his leg on a young Black man’s neck during an arrest. THE CANADIAN PRESS/Paul Chiasson
Probe called for after video appearing to show Montreal officer’s knee on Black youth’s neck

Politicians call for investigation after clip evokes memories of George Floyd incident

Flora Northwest was taken to the Ermineskin residential school when she was six years old. (Emily Jaycox/Ponoka News)
Ermineskin residential school survivor: ‘It just brings me back to the cries at night’

Discovery in Kamloops of remains of 215 children a painful time for survivors

Thousands of protesters make their way through the downtown core during a Black Lives Matter protest in Ottawa, Friday June 5, 2020. THE CANADIAN PRESS/Adrian Wyld
MPs’ study of systemic racism in policing concludes RCMP needs new model

Chair of the House public safety committee says it’s time for a reckoning on ‘quasi-military’ structure

Most Read