The impending closure of a historic oilfield in the Northwest Territories marks a significant turning point for both the region and Imperial Oil Ltd., the company behind its development. This Calgary-based corporation, which is majority owned by the powerful U.S. firm ExxonMobil Corp., revealed on Friday that it intends to accelerate the shutdown process at the Norman Wells oilfield by the end of the third quarter of this year, a timeline much earlier than the previously anticipated end-of-decade closure.
During a conference call where analysts discussed the latest financial results, CEO John Whelan communicated this shift in strategy, which has resulted in a substantial after-tax charge of $320 million against Imperial’s fourth-quarter earnings. This financial downturn was exacerbated by other factors, including a decline in commodity prices and production disruptions caused by adverse weather conditions in the oilsands.
Whelan expressed gratitude towards the team members and partners at Norman Wells who have contributed to the operations over the years. He emphasized the company's commitment to maintaining strong relationships and working collaboratively with local communities as they proceed with the decommissioning process.
Located nearly 700 kilometers northwest of Yellowknife along the Mackenzie River, Norman Wells is a small town with a population of around 800 residents. Interestingly, it was the first community established in the Northwest Territories solely due to non-renewable resource development, in contrast to most other towns which have their origins in the fur trade. Imperial's involvement began in 1918 when it acquired land claims and subsequently drilled its first discovery well the following year.
This announcement has been described as "difficult news" by N.W.T. Premier R.J. Simpson, particularly for the residents of Norman Wells and the surrounding Sahtu region. In a written statement, he acknowledged the community's rich history and the vital role its people have played in shaping the territory. While the closure decision is not entirely surprising given the age of the facilities and prevailing long-term trends in the industry, it is nonetheless disappointing, especially at a time when community stability is crucial. He stated that the government’s immediate focus will be on providing support and establishing a responsible path forward for the affected individuals.
In the midst of this challenging news, Imperial announced a 20 percent increase in its quarterly dividend, raising it from 72 cents to 87 cents per share. However, the company's fourth-quarter earnings saw a steep decline to $492 million, down from $1.23 billion during the same period the previous year. This equates to earnings of $1 per diluted share compared to $2.37 from the prior year. On an adjusted basis, Imperial earned $1.97 per diluted share, reflecting a notable decrease from the previous year’s figures.
Total revenue and other income reached $11.28 billion, a drop from $12.61 billion in the fourth quarter of 2024. Alongside the financial impact attributed to the Norman Wells closure, Imperial also incurred a one-time charge associated with changes in materials and supply inventory management that are expected to yield significant operational and working capital efficiencies going forward.
In terms of market conditions, the average price of West Texas Intermediate crude oil for the fourth quarter of 2025 was reported at $59.14 a barrel, representing a 16 percent decrease compared to the previous year. Similarly, the prices for the oilsands crude produced by Imperial also experienced a marked decline.
At the Kearl oilsands mine, which is a joint venture between Imperial and Exxon located north of Fort McMurray, Alberta, total gross bitumen production fell to 274,000 barrels per day, down from 299,000 barrels per day. Whelan noted that exceptionally wet weather last fall significantly impacted operations, stating that the region experienced more rainfall within a few days in October than is typically recorded over an entire summer, leading to equipment mobility issues and delays in accessing high-quality ore.
Overall, the upstream production in the fourth quarter averaged 444,000 gross oil-equivalent barrels per day, a decrease from 460,000 the previous year. Similarly, refinery throughput averaged 408,000 barrels per day, slightly down from 411,000 barrels per day in the fourth quarter of 2024.
