The cost-cutting measure is expected to generate $150 million in annual expense savings by 2028, allowing the company to focus on increasing cash flow and delivering industry-leading shareholder returns.
Imperial Oil on September 29 confirmed a sweeping restructuring initiative designed to centralize technical and corporate functions, a move that will result in the reduction of approximately one-fifth of its employee base over the next three years.
Imperial is restructuring to cut costs and maximize asset value by leveraging its relationship with ExxonMobil. It will centralize the company functions in global technology centers for better efficiency.
The most significant impact of the announcement involves the workforce. Imperial stated that the transition process is expected to reduce employee roles by approximately 20% by the end of 2027. While the company did not specify the exact number of jobs affected, industry analysis suggests the reduction could impact around 1,000 positions, based on Imperial's reported headcount of 5,100 employees at the end of 2024.
“We recognize the considerable impact this restructuring will have on our employees and their families. We are deeply committed to supporting our employees through this transition,” said John Whelan, Imperial’s Chairman, President and CEO.
In addition to the role reductions, the company plans to further consolidate activities to its operating sites, a move intended to enhance collaboration and improve operational focus and execution excellence.
On the financial front, the restructuring is designed to provide rapid and significant returns. Imperial anticipates achieving a reduction in annual expenses totaling $150 million by 2028. This long-term cost benefit comes at the expense of a substantial one-time restructuring charge of approximately $330 million before-tax, which the company expects to record in the third quarter of 2025.
Whelan emphasized that the move is aligned with a long-standing strategy of asset maximization. “Leveraging the rapidly advancing technology environment and the growth of global capability centres, this restructuring plan advances our long-standing strategy of maximizing the value of our existing assets,” Whelan stated. “At the same time, these actions enhance our foundation for future growth and position us to continue delivering industry-leading returns and long-term value for our shareholders.”
The company’s corporate guidance for 2025 remains unchanged, and Imperial asserted it is well-positioned to meet or beat its medium-term production and unit cost targets for its key oil sands operations at Kearl and Cold Lake.
