Husky profits down in 2010

February 15, 2011

LIMA — Husky Energy made less money in 2010, but the energy giant still made a lot of money.The Canadian parent company to the Lima Refinery released its annual report Tuesday showing record cash flow despite a second year of reduced profits. All told, the company netted $1.2 billion in 2010 from a business that includes everything from the oil sands where the oil is collected to refineries and a chain of filling stations. Profits were down slightly from $1.4 billion in 2010 and well below the high-water mark of 2008, when the company pulled in a record $3.75 billion.The 2010 take was less that analyst expected, due in part to decreases in production and a stronger Canadian dollar. At the same time, higher light crude oil prices and improved margins on the refining side helped the company increase cash flow a record 42 percent in 2010 compared to the previous year.“2010 was a transitional year as we undertook a comprehensive portfolio review. From this, we developed and implemented a strategic plan setting out clear financial and operational milestones,” said CEO Asim Ghosh.The company reported increases in production in its U.S. and Canadian refining operations. In the fourth quarter it averaged 274,700 barrels per day, compared to 232,300 barrels per day in the same period of 2009 and 249,700 barrels per day in the third quarter. Company officials attribute the increase to a maintenance turnaround at its Lloydminster Upgrader and a return to higher output levels following a shutdown.In the fourth quarter, Husky’s total U.S. and Canadian refinery and upgrader throughput was 274,700 barrels per day compared with 232,300 barrels per day during the same period of 2009 and 249,700 barrels per day in the previous quarter. Throughput levels have steadily improved postmaintenance turnaround at the Lloydminster Upgrader and U.S. downstream volumes have recovered to normal levels following the shutdown of an Enbridge oil pipeline. Husky made some major capital investments in 2010, most of it directed at what it refers to as its “upstream” business, which includes oil drilling and exploration. It spent $860 million in western Canada oil and gas properties from Exxon Mobil Corp. and another $2.5 billion on the Sunrise oil sands project in northern Alberta.According to the report, Husky plans to boost capital spending by 20 percent in 2011, though where that money will be spent has not been made public.You can comment on this story at