- Cenovus Energy's (NYSE:CVE) $1.3B funding gap for 2015 may wind up smaller than anticipated, TD Securities analyst Menno Hulshof says as he points to the improved refining outlook since earlier this year due to the widening Brent-WTI crude differential.
- Hulshof notes CVE's guidance indicated that every US$1/bbl increase boosts refining cash flow by US$90M; if crack spreads averaged US$16.75 - $5 higher than guidance - then the refining cash flow outlook would increase to ~$700M and the funding shortfall would fall to $850M.
- The analyst also says CVE appears to be turning the corner on coalescence issues at Foster Creek since operating costs and steam-to-oil ratios appear to have peaked and are trending lower.