Cenovus has strong second-quarter operational performance

Oil sands production increases, operating costs decline

Calgary, Alberta (July 28, 2016) – Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) continued to deliver strong and reliable operating performance in the second quarter of 2016. The company remains on track with its plans to bring on two new oil sands expansion phases and achieve up to $500 million in capital, operating and general and administrative (G&A) cost reductions compared with its original 2016 budget.

“We’ve achieved significant sustainable improvements in our cost structure over the last year and a half, and we’ll remain vigilant on costs to maximize our competitive position in this challenging and volatile commodity price environment,” said Brian Ferguson, Cenovus President & Chief Executive Officer. “Our reduced cost base and strong operational performance, coupled with an improvement in benchmark oil and natural gas prices from the lows reached earlier this year, contributed to a solid second quarter.”

Key developments

  • Decreased per-barrel oil sands operating costs by 24% and per-barrel conventional crude oil operating costs by 9% compared with the second quarter of 2015
  • Achieved production at Foster Creek of almost 69,000 barrels per day (bbls/d) net in June. Second-quarter production was nearly 65,000 bbls/d net, 11% higher than in the same period of 2015. Foster Creek is on track to exit the year with volumes above 70,000 bbls/d net
  • Increased production at Christina Lake to more than 78,000 bbls/d net, 8% higher than in the second quarter of 2015
  • The Foster Creek phase G and Christina Lake phase F expansion projects remain on track to add incremental production in the third quarter
  • Exited the quarter with nearly $8 billion in liquidity, including $3.8 billion in cash, $4 billion in unused credit facilities, and net debt to capitalization of 17%

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