LOG 3
Petro-Canada (Con't)
SELECTED FINANCIAL DATA
December 31, 1998
(unaudited, millions of Canadian dollars)
Revenue
Upstream 366 496 1 436 1 829
Downstream 993 1 200 4 068 4 980
Shared Services 17 (2) 15 (6)
Inter-segment sales (128) (188) (503) (707)
------- ------- ------- -------
1 248 1 506 5 016 6 096
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------- ------- ------- -------
Earnings from operations
Upstream 26 54 29 188
Downstream 34 48 204 225
Shared Services (21) (24) (103) (99)
------- ------- ------- -------
39 78 130 314
Reorganization costs - - (42) -
Gain (loss) on asset sales (20) - 7 (8)
------- ------- ------- -------
Net earnings 19 78 95 306
------- ------- ------- -------
------- ------- ------- -------
Cash flow
Upstream 149 254 516 900
Downstream 94 60 420 415
Shared Services (20) (6) (68) (52)
Reorganization costs - - (38) -
------- ------- ------- -------
223 308 830 1 263
------- ------- ------- -------
------- ------- ------- -------
Expenditures on property, plant
and equipment and exploration
Upstream 226 249 818 805
Downstream 105 74 276 215
Shared Services 14 14 22 29
------- ------- ------- -------
345 337 1 116 1 049
------- ------- ------- -------
------- ------- ------- -------
Return on capital employed
(per cent) 3.0 6.8
Cash flow return on capital
employed (per cent) 16.3 24.5
Debt 1 829 1 741
Cash and short-term investments 431 75
Debt to debt plus equity
(per cent) 31.7 30.7
SELECTED OPERATING DATA
December 31, 1998
FOURTH QUARTER FULL YEAR
1998 1997 1998 1997
-----------------------------------------------------------------------
Crude oil and natural gas liquids
production, net before royalties
(thousands of barrels per day)
Conventional crude oil
- Western Canada 33.9 40.8 38.3 43.3
Conventional crude oil
- Hibernia 20.1 2.8 13.0 0.7
Conventional crude oil
- Algeria 5.0 4.3 4.5 5.7
Conventional crude oil
- Norway 8.4 7.9 7.4 6.3
Synthetic and bitumen 27.0 28.2 25.2 24.9
Field natural gas liquids 12.9 13.6 12.7 14.2
Natural gas production, net before
royalties, excluding injectants
(millions of cubic feet per day) 742 758 722 760
Total production(1) (thousands of
barrels of oil equivalent per day) 181.5 173.4 173.3 171.1
Ethane and natural gas liquids
production from straddle plants 38.1 37.7 35.2 39.6
Petroleum product sales
(thousands of cubic metres per day)
Gasolines 22.2 21.2 21.7 21.5
Distillates 17.9 17.7 17.1 17.9
Other including petrochemicals 10.9 10.2 10.3 9.1
------- ------- ------- -------
51.0 49.1 49.1 48.5
------- ------- ------- -------
------- ------- ------- -------
Crude oil processed by Petro-Canada
(thousands of cubic metres per day) 46.7 48.7 46.6 46.7
Average refinery utilization
(per cent) 95(2) 107 95(2) 103
Refining and supply margin
(cents per litre) 0.9 1.6 1.7 1.9
Marketing margin (cents per litre) 5.5 5.3 5.6 5.5
(1) Natural gas converted at 10 000 cubic feet of gas to 1 barrel of oil
equivalent.
(2) Reflects 1998 increase of 8 per cent in rated capacity.
CONSOLIDATED STATEMENT OF EARNINGS
December 31, 1998
(unaudited, millions of Canadian dollars)
FOURTH QUARTER FULL YEAR
1998 1997 1998 1997
-----------------------------------------------------------------------
Revenue 1 248 1 506 5 016 6 096
Expenses
Crude oil and product purchases 643 779 2 413 3 183
Producing, refining and marketing 328 357 1 309 1 352
General and administrative (1) 34 35 265 194
Exploration 27 25 95 75
Depreciation, depletion and
amortization 135 123 530 482
Taxes other than income taxes 13 16 63 68
Interest 31 26 122 106
------- ------- ------- -------
1 211 1 361 4 797 5 460
Earnings before income taxes 37 145 219 636
Provision for income taxes 18 67 124 330
------- ------- ------- -------
Net earnings 19 78 95 306
------- ------- ------- -------
------- ------- ------- -------
(1) General and administrative expenses for the year ended December 31,
1998 include a provision of $64 million before income tax, for the
reorganization of the Company's Downstream administration. The
provision decreases 1998 net earnings by $42 million and cash flow by
$38 million.
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
December 31, 1998
(unaudited, millions of Canadian dollars)
FOURTH QUARTER FULL YEAR
1998 1997 1998 1997
-----------------------------------------------------------------------
Retained earnings (deficit) at
beginning of period 150 83 139 (88)
Net earnings 19 78 95 306
Dividends on common and variable
voting shares (22) (22) (87) (79)
------- ------- ------- -------
Retained earnings at end of period 147 139 147 139
------- ------- ------- -------
------- ------- ------- -------
SHARE INFORMATION
December 31, 1998
(unaudited, stated in Canadian dollars)
FOURTH QUARTER FULL YEAR
1998 1997 1998 1997
-----------------------------------------------------------------------
Average shares outstanding
(millions) 271.2 270.9 271.2 270.9
Net earnings per share 0.07 0.29 0.35 1.13
Cash flow per share 0.82 1.13 3.06 4.66
Dividends per share 0.08 0.08 0.32 0.26
Share Price(a) - High 21.40 29.85 26.95 29.85
- Low 15.80 23.90 14.55 18.90
- Close at
December 31 16.25 26.00 16.25 26.00
Shares traded(b) (millions) 59.5 68.4 244.7 271.1
(a) Share prices are for trading on the Toronto and Montreal Stock
Exchanges.
(b) Total shares traded on the Toronto, Montreal and New York Stock
Exchanges.
CONSOLIDATED STATEMENT OF CASH FLOWS
December 31, 1998
(unaudited, millions of Canadian dollars)
FOURTH QUARTER FULL YEAR
1998 1997 1998 1997
-----------------------------------------------------------------------
Operating activities
Net earnings 19 78 95 306
Items not affecting cash flow 177 205 640 882
Exploration expenses 27 25 95 75
------- ------- ------- -------
Cash flow 223 308 830 1 263
Decrease (increase) in operating
working capital and other 141 92 238 (167)
------- ------- ------- -------
Cash flow from operating
activities 364 400 1 068 1 096
------- ------- ------- -------
Investing activities
Expenditures on property, plant
and equipment and exploration (345) (337) (1 116) (1 049)
Proceeds from sale of assets 419 30 505 201
Increase in deferred charges
and other assets, net (12) (17) (17) (15)
------- ------- ------- -------
62 (324) (628) (863)
------- ------- ------- -------
------- ------- ------- -------
Financing activities and dividends
Proceeds from issue of
long-term debt 386 - 387 -
Reduction of notes payable
- Hibernia (250) - (250) -
Reduction of long-term debt (140) (3) (140) (114)
Dividends on common and variable
voting shares (22) (22) (87) (79)
Proceeds from issue of common
and variable voting shares 1 - 6 3
------- ------- ------- -------
(25) (25) (84) (190)
------- ------- ------- -------
------- ------- ------- -------
Increase in cash and short-term
investments 401 51 356 43
Cash and short-term investments at
beginning of period 30 24 75 32
------- ------- ------- -------
Cash and short-term investments at
end of period 431 75 431 75
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CONSOLIDATED BALANCE SHEET
(unaudited, millions of Canadian dollars)
DECEMBER 31, DECEMBER 31,
1998 1997
------------------------------------------------------------------------
Assets
Current assets
Cash and short-term investments 431 75
Other current assets 1 153 1 502
------- -------
1 584 1 577
Property, plant and equipment, net 6 433 6 441
Deferred charges and other assets 381 320
------- -------
8 398 8 338
Liabilities and shareholders' equity
Current liabilities
Other current liabilities 1 158 1 189
Current portion of long-term debt 3 3
------- -------
1 161 1 192
Notes payable - Hibernia - 250
Long-term debt 1 826 1 488
Deferred credits and other liabilities 362 321
Deferred income taxes 1 113 1 165
Shareholders' equity 3 936 3 922
------- -------
8 398 8 338
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Petro-Canada Announces Significant Discovery in Alberta Foothills
CALGARY, Jan. 20 /CNW/ - Petro-Canada today announced that it has made a
significant new natural gas discovery in the Benjamin Creek area, in the
Alberta Foothills about 90 kilometres northwest of Calgary. With test flow
rates of 35 million cubic feet per day, and a net pay of 147 metres, the
Benjamin Creek 16-28-28-7 W5M well is one of the best natural gas wells ever
drilled by Petro-Canada. The initial production rate for the well is expected
to be 20 to 25 million cubic feet per day. Petro-Canada has a 74 per cent
interest in the Benjamin Creek well and EBOC Energy Ltd. has the remaining 26
per cent interest.
''One of our key exploration areas in Western Canada is the Alberta
Foothills region, and we are particularly pleased with the outstanding results
that have been achieved at Wildcat Hills and Benjamin Creek recently,'' said
Norm McIntyre, Executive Vice-President of Petro-Canada. ''There is large
growth potential in the area, and we will continue pursuing an aggressive
drilling program to fully exploit our opportunities there. In 1999, we will
continue with an eight to ten well program, including development and
exploration drilling.''
Targeting the Turner Valley formation, the Benjamin Creek well was
drilled to a total depth of 3 800 metres. In the next few months, natural gas
from this well will be tied into an existing pipeline that feeds into the
Petro-Canada operated Wildcat Hills gas plant.
The Benjamin Creek discovery is the latest of 18 consecutive successful
wells that have been drilled on Petro-Canada's land holdings in the Wildcat
Hills/Benjamin Creek area in the past three years. Benjamin Creek is located
approximately 20 kilometres north of Wildcat Hills, where Petro-Canada
announced a major new gas discovery in March 1998.
================================================================================
Rig Begins Grand Banks Exploration Program
ST. JOHN'S, NF, Dec. 31 /CNW/ - Drilling of an appraisal well at the
Hebron area of the Grand Banks has started on behalf of a consortium of major
oil companies.
The drilling rig Glomar Grand Banks, owned by Glomar International
(Canada) Drilling Company, spudded the D-94 well late in the evening
yesterday, December 30th. This is the fourth well in the area since the first
exploration well on the Hebron structure was drilled in 1980.
''This drilling program is another indication of our industry's interest
in the Grand Banks, and a recognition of the importance of the offshore oil
industry to Newfoundland's economy and employment picture,'' said Andrew
Adams, chairman of a management committee of oil companies conducting the
drilling program.
The cost of drilling Hebron D-94 is approximately $30.5 million and is
being shared by the members of the consortium. Interests in the Hebron well
are held by Chevron Canada Resources (31.9%), Mobil Canada (36.8%), Norsk
Hydro Oil & Gas Inc. (9.4%) and Petro-Canada (21.9%).
The well is located 340 kilometres southeast of St. John's and about 10
kilometres north of the Terra Nova field.
The rig recently underwent an extensive refit and spent the last several
weeks at the Friede Goldman Newfoundland Ltd. shipyard in Marystown where some
final work was completed.
Approximately 80 per cent of the crews assigned to the drilling program
are Newfoundlanders. Of the 210 positions required by the semi-submersible rig
and accompanying supply ships, 168 people are from Newfoundland.
In addition, 54 Newfoundlanders are employed for shore base support,
providing helicopter services, weather forecasting and conducting drilling
operations assistance. Newfoundland workers account for 87 per cent of those
employed for shore base support.
''We're pleased that so many residents of the province will be involved
in this program,'' said Gary Bruce, Vice-President, Offshore Development and
Operations for Petro-Canada, operator of the D-94 well.
Two supply vessels for the drilling program will be operated by Seabase,
a Newfoundland company, and contracted from Maersk Company of Canada Ltd.
Cougar Helicopters Inc. of St. John's is providing air transportation
services.
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