Cenovus Energy reports quarterly loss, trims 2016 capex
By Nia Williams
CALGARY, Alberta, Oct 27 (Reuters) – Canadian oil and gas producer Cenovus Energy Inc reported a bigger-than-expected third-quarter loss on Thursday due to asset impairment charges resulting from declining heavy oil and natural gas prices.
The Calgary-based company recorded a net loss of C$251 million ($187.6 million), or 30 Canadian cents per share, for the third quarter, compared with a profit of C$1.8 billion a year earlier, which included a C$1.9 billion after-tax gain.
Operating losses, which exclude most onetime items, were 28 Canadian cents per share in the latest quarter, steeper than analysts’ average estimate of 9 Canadian cents per share, according to Thomson Reuters I/B/E/S.
Cenovus shares were up 4.9 pecent in midday trading on the Toronto Stock Exchange at C$21.15
Cenovus trimmed its 2016 capital spending budget to C$1.0 billion – C$1.1 billion, from the C$1.1 billion – C$1.2 billion previously forecast, and said it managed to cut operating costs per barrel by 14 percent versus the same period a year earlier.
Chief Executive Officer Brian Ferguson told investors on a third-quarter earnings call that the company’s 2017 capital budget was likely to be focused on capital discipline, and its oil sands operations would be its top priority.
Cenovus is updating cost estimates for Phase G of its Christina Lake thermal plant in northern Alberta, which was deferred after crude prices slumped in 2014. It was one of nearly 20 oil sands projects to be put on hold by producers.
“We have been clear about our capital priorities within the oil sands, and that Christina Lake phase G will be the first project in the oil sands to resume construction,” Ferguson said, adding that the company would give more details in December.
Cenovus also narrowed its full-year oil and gas production forecast to 266-272,000 barrels of oil equivalent per day.
Its oil sands production in the third quarter was 153,591 b/d, up 5 per cent on the same period a year earlier, while total oil production was 208,072 b/d net to Cenovus, down 1 per cent on the third quarter of 2015.
(Additional reporting by John Benny in Bengaluru; editing by Sriraj Kalluvila and Jonathan Oatis)