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Cenovus delivers strong third-quarter operating results

Company generates free funds flow, reduces net debt

Calgary, Alberta (October 29, 2020) – Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) continued to deliver strong operational performance and further improved its financial resilience in the third quarter by remaining committed to disciplined capital investment, cost leadership and leveraging the flexibility of its assets and marketing strategy to generate positive free funds flow. The company took advantage of the higher commodity prices by ramping up production from its oil sands assets and selling barrels stored in the preceding quarter. Higher crude oil prices and increased sales volumes allowed the company to achieve free funds flow for the third quarter of $266 million, which contributed to a reduction in net debt to $7.5 billion at the end of the period.

“The third quarter clearly demonstrated the strength and reliability of our operations and our ability to effectively manage production and sales by storing barrels when prices declined and then capitalizing on a price recovery to optimize returns,” said Alex Pourbaix, Cenovus President & Chief Executive Officer. “We continue to find ways to optimize our cost structure, expand our market access, and strengthen the balance sheet. We believe the proposed transaction with Husky Energy, announced earlier this week, will address these priorities, positioning us to come through this period more resilient, with increased and stable free funds flow, supporting accelerated deleveraging and returns to shareholders.”

Cenovus’s Christina Lake project

Christina Lake oil sands project

Our oil sands projects in northern Alberta use 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.

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Steam generators at Cenovus’s Foster Creek project in northern Alberta.

Foster Creek steam generators

Our oil sands projects use 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.

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