Kearl decision by June: Imperial Oil

The head of Imperial Oil Ltd. (TSX:IMO) hinted at an “exciting” announcement in coming weeks about its multibillion Kearl oilsands project, one of only a few to press ahead in the current economic doldrums.

CALGARY — The head of Imperial Oil Ltd. (TSX:IMO) hinted at an “exciting” announcement in coming weeks about its multibillion Kearl oilsands project, one of only a few to press ahead in the current economic doldrums.

The company’s board is expected to give Kearl the final go-ahead before the end of June, at which point it will be able to provide a fresh cost estimate and schedule, chief executive Bruce March said after the company’s annual meeting Thursday. “We should have something exciting to share with you in the next several weeks,” he said.

Kearl’s original price tag was pegged at about $8 billion, but a great deal has changed since then.

“We have not seen costs come out of our business to go down to 2003 or 2004 levels, but it’s a lot better than it was six, nine months ago at the peak of the US$147 oil market,” March said.

Until recently, oilsands producers struggled to keep up with ballooning costs of labour, steel and construction materials, but most producers say the cost of inflation is easing.

Imperial had been set to make a decision on Kearl late last year, but March said the company took some extra time to work on reining in costs.