Canada’s Vermilion Energy Posts C$71mn Q2 Loss
Canada’s Vermilion Energy, active in North America, Europe and Australia, said July 27 it had a Q2 2020 net loss of C$71.3mn (US$53.3mn), down from earnings of C$2mn in the comparable 2019 period but an improvement from the C$1.32bn loss recorded in Q1 this year.
The loss largely reflected a 55% year-over-year decline in quarterly oil and gas sales, to C$193mn from C$428mn, which Vermilion attributed to commodity prices impacted by demand destruction from the Covid-19 pandemic and the Opec+ price war in early March.
Realised natural gas prices averaged C$1.85/’000ft3 in Q2, down from C$3.09/’000ft3 a year ago, while natural gas liquids averaged C$8.94/b, down from $11.25/b. Crude oil and condensate averaged C$34.90/b, down from C$79.46/b.
Weaker prices were partly offset by a 3% increase in production compared to Q1 2020, to 100,366 barrels of oil equivalent (boe)/day, primarily in North America and Australia. But year-over-year production in the second quarter was down 2.9%. Quarterly natural gas production was essentially unchanged year-over-year, but crude oil and liquids production fell to 54,629 b/d from 57,071 b/d.
Vermilion suspended its dividends and share buybacks in the second quarter, it said, but in due course “will review our shareholder return policy to determine the appropriate time to reinstate a dividend and/or buy back shares.”