Higher oil prices fuel PrairieSky Royalty third quarter earnings and revenue rebound

·1 min read

CALGARY — PrairieSky Royalty Ltd. says its oil and gas revenue and net earnings staged a rebound in the third quarter ending Sept. 30 as oil prices recovered from pandemic-related lows.

The Calgary-based company, which collects royalties from oil and gas production on lands for which it has the petroleum mineral rights, reports revenue increased 54 per cent to $43.5 million in the third quarter compared with the second.

It reported net earnings of $9.4 million, compared with a loss of $400,000, as royalty production averaged 18,745 barrels of oil equivalent per day, up from 18,670 boe/d in the second quarter.

It says it realized an average of $41.11 per barrel for oil in the third quarter, up from an average of $24.31 in the second quarter but short of the $59.04 per barrel it realized in the third quarter of 2019.

Meanwhile, its realized natural gas price rose to $1.62 per thousand cubic feet, up from $1.39 in the second quarter and 72 cents in the third quarter of 2019.

Producers took about 30 per cent of PrairieSky's oil production off-line in the second quarter as COVID-19 lockdowns eroded global oil demand, but the company says activity in Western Canada was gradually restored during the most recent quarter, with 18 rigs working on its lands at the beginning of the period and 73 rigs at the end.

This report by The Canadian Press was first published Oct. 26, 2020.

Companies in this story: (TSX:PSK)

The Canadian Press