Expected 2015 cost savings increase to $400 million

Third-quarter oil sands production up 17%


Calgary, Alberta (October 29, 2015) – Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) continues to make significant progress in reducing its costs while delivering strong operational performance and oil sands production growth. The company is benefiting from the decisive steps taken over the past year to increase its financial resilience in the face of what is expected to be a prolonged period of lower oil prices.

"We’re delivering on the commitments we made at the outset of 2015 to improve Cenovus’s position as a low-cost producer,” said Brian Ferguson, Cenovus President & Chief Executive Officer. “We’ve realized substantial, sustainable cost reductions, maintained capital discipline and strengthened our balance sheet. We will continue to look for additional opportunities to reduce costs, become more efficient and enhance shareholder value."

Third quarter highlights

  • Maintained financial strength with approximately $4.4 billion of cash and cash equivalents on the balance sheet and a net debt to capitalization ratio of 13%
  • Achieved cost reductions that were better than forecast, bringing total anticipated savings for 2015 to approximately $400 million
  • On track to achieve $100 million in forecast annual savings, starting in 2016, from workforce reductions
  • Reduced oil sands per-unit operating costs by 23% from the third quarter of 2014 and total crude oil per-unit operating expenses by 22%
  • Generated cash flow of $444 million, down 55% from the same period a year earlier
  • Recognized for strong performance in corporate responsibility as the only North American oil and gas producer to be included in this year’s Dow Jones Sustainability (DJSI) World Index

Read the complete news release

Photos

Cenovus's Christina Lake project in northern Alberta uses steam-assisted gravity drainage (SAGD) technology to produce oil. The process involves drilling into the reservoir and injecting steam at a low pressure to soften the oil so it can be pumped to the surface.
Courtesy Cenovus Energy
Steam generators at Cenovus’s Foster Creek project in northern Alberta. The project uses a process called steam-assisted gravity drainage (SAGD) to produce oil, which involves drilling into the reservoir and injecting steam at a low pressure to soften the oil so it can be pumped to the surface.
Courtesy Cenovus Energy