Cenvous Energy Cuts E&P Budget Again

Cenovus Energy Inc cut its 2016 exploration and production budget again, as the Canadian oil producer looks to tackle a steep fall in oil prices that has eroded cash flows.

 

The company, which reported a much bigger-than-expected loss on Thursday, cut the full-year exploration and production budget to C$715 million-C$805 million, from C$740 million-C$855 million it had previously forecast.

 

Cenovus also narrowed its full-year oil and gas production forecast to 266-272,000 barrels of oil equivalent per day (boe/d) from 258-280,000 expected earlier.

 

The company is on track to increase its oil sands production capacity to 390,000 barrels per day (bpd) on a gross basis, Chief Executive Brian Ferguson said.

 

Cenovus's oil sands production in the third quarter was 153,591 bpd, while total oil production was 208,072 bpd.

 

The company reported a net loss of C$251 million ($187.6 million), or 30 Canadian cents per share, for the third quarter ended Sept. 30, compared with a profit of C$1.80 billion, or C$2.16 per share, a year earlier.

 

The year-ago period included a C$1.9 billion after-tax gain.

 

Operating loss, which excludes most one-time items, was 28 Canadian cents per share in the latest quarter, much steeper than analysts' average estimate of 9 Canadian cents per share, according to Thomson Reuters I/B/E/S.


($1 = 1.3377 Canadian dollars)

(Reporting by John Benny in Bengaluru; Editing by Martina D'Couto and Sriraj Kalluvila)