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Cenovus Keeps Output Plans Unchanged Despite Wider Canadian Crude Discount
Cenovus says it will keep output plans unchanged despite a wider Canadian crude discount it expects to be temporary.
Key points
- Cenovus pumped a record 1.024 million barrels of oil equivalent per day in the quarter, up from 832,900 boepd a year earlier.
- Adjusted refining margin rose to $55.52 per barrel in the third quarter, from $29.83 in the preceding three months.
- Cenovus agreed in October to acquire Athabasca Oil in a $5.7-billion cash-and-stock deal, expected to close in December.
Why it matters. Cenovus expects the wider discount on Western Canadian crude to be temporary and says it is not changing its production outlook as a result.
Calgary-based Cenovus Energy said on Wednesday it will not change its production plans, despite a rise in third-quarter profit. CEO Jon McKenzie blamed high freight rates for sharply cutting export demand for Canadian barrels re-exported off the US Gulf Coast, not a lack of pipeline capacity, and said he expects the wide differentials to be temporary. As of Monday, Western Canada Select traded more than US$30 a barrel below West Texas Intermediate, its widest spread since 2018.
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Cenovus Keeps Output Plans Unchanged Despite Wider Canadian Crude Discount
Cenovus Energy said on Wednesday that it will not change its production plans despite an unexpectedly wide discount on Western Canadian crude oil this fall. The company expects the discount to be temporary. Cenovus reported an increase in third-quarter profit, which it attributed to record oil production and improved refining margins. The Canadian oil sands producer's Christina Lake facility, southeast of Fort McMurray, Alberta, is among its operations. The reported figures were not fully detailed in the material reviewed.