Fri, Jun. 26, 4:58 PM
- Alberta's government names the top executive of a province-owned bank, ATB Financial CEO Dave Mowat, to head a panel to review oil and natural gas royalty payments and issue recommendations by year’s end.
- The announcement to move ahead with the royalty review, even as oil-rich Alberta struggles with sharply lower crude prices, comes a day after the province said it would double a carbon tax levied on large-scale emitters of greenhouse gases over the next two years.
- Alberta is home of the Canadian subsidiaries of energy giants Exxon Mobil (XOM, IMO), Royal Dutch Shell (RDS.A, RDS.B) and Total (NYSE:TOT), among others.
- Among other top Alberta oil producers: SU, OTCPK:HUSKF, CVE, CNQ, ECA, TLM, OTCQX:COSWF, CPG, OTCPK:PEGFF
Thu, Jun. 25, 1:04 PM
- Alberta's new government says it will raise the province's existing carbon tax on industrial emitters starting next year, the first step in revamping regulations to curb rising greenhouse gas output from surging oil sands production.
- The price will rise to C$20/metric ton in 2016 from C$15 now, and increase to C$30 in 2017, when the rules will expire, the environment ministry says; large emitters will be required to reduce emissions by 15% next year and 20% in 2017, compared with a 12% reduction this year.
- Alberta’s oil sands have become a target for environmentalists because of their significant carbon footprint, and the new NDP government had campaigned on a promise to toughen the province’s environmental standards.
- Among Alberta's top oil producers: SU, IMO, XOM, OTCPK:HUSKF, CVE, CNQ, ECA, TLM, OTCQX:COSWF, CPG, OTCPK:PEGFF
Fri, Jun. 19, 9:09 AM
- Cenovus Energy (NYSE:CVE) confirms it is in talks about the potential sale of its royalty interest and mineral fee title lands but provides no details of the other party’s identity or the estimated value of the deal.
- The announcement follows a report yesterday that CVE was holding exclusive talks with the Ontario Teachers Pension Plan about a deal that could be worth C$2.5B-C$3B.
- CVE says there is no assurance of a deal and has no plan to comment further on the discussions.
- Given the likely size of the proceeds, CVE would need to sell both third-party and company-owned lands in one large transaction, a CIBC analyst says.
Thu, Jun. 18, 5:10 PM
- Cenovus Energy (NYSE:CVE) surged to a 4% gain in today's trade, nearly all of it in the final half-hour, after Reuters reported the Canadian company is in advanced talks to sell its package of royalty lands to Ontario Teachers’ Pension Plan.
- The royalty lands, which generate revenue from drilling by other companies and are located across Alberta, Saskatchewan and Manitoba, are said to be worth C$2.5B-C$3B.
- The fund manager had said it was seeking energy assets as it looks to trim positions in oil and gas derivatives and invest instead directly in producing assets.
Tue, Jun. 16, 5:14 PM
- Cenovus Energy (NYSE:CVE) recently appointed Danish shipping executive Claus Thornberg to lead its marine shipping strategy, in a newly created position to help move more of the company’s crude offshore for transport to refineries in Asia, WSJ reports.
- The appointment reportedly is a first among landlocked Canadian oil sands producers looking to diversify their markets beyond the U.S., which takes up almost all Canadian crude exports.
- CVE has committed to ship more crude to the west coast on a proposed expansion of Kinder Morgan's Trans Mountain pipeline, and Asian markets could soon receive a sizable amount of its crude if crude-by-rail trans-loading facilities are built along U.S. and Canadian west coast ports.
Thu, Jun. 11, 9:41 AM
- Cenovus Energy (CVE -0.7%) says it has returned to normal operations at its Foster Creek oil sands project in northern Alberta after a forest fire led to a precautionary 11-day shutdown of the operation.
- CVE says it expects Q2 production to be reduced by ~10.5K bbl/day due to the shutdown, with a full-year production impact estimated at 2.6K bbl/day.
- CVE expects full-year production from Foster Creek to remain within its previously announced annual guidance of 62K-68K bbl/day; Foster Creek is jointly owned with ConocoPhillips (COP -0.1%).
- CVE also says its Athabasca natural gas operation, whose gas is used as fuel for Foster Creek and which also was shut down due to the fire, has returned to normal operations.
Tue, Jun. 9, 8:22 AM
- Canadian Natural Resources (NYSE:CNQ) and Cenovus Energy (NYSE:CVE) have resumed production at sites shut by a two-week-old wildfire in northern Alberta.
- CNQ says it expects to resume full production later this week at its 80K bbl/day Primrose site and its 30K bbl/day Kirby South site; the Primrose site had been evacuated and shut down, while Kirby South was forced to cut output because of the temporary closure of a pipeline.
- CVE says it began increasing output at its 135K bbl/day Foster Creek location over the weekend, but has not said when output would return to normal.
- The fires had shut down ~10% of Canada’s oil sands output, or ~233K bbl/day.
Fri, Jun. 5, 8:20 AM
- Cenovus Energy (NYSE:CVE) agrees to acquire a rail-loading terminal in Alberta to ship crude oil from Canexus Corp. for C$75M (~US$60M), in a move designed to cope with limited pipeline capacity in western Canada.
- The terminal has the capacity to handle 10 unit trains/week, or ~70K bbl/day, and an additional 30K bbl/day can be shipped by truck from the site.
- Canexus spent C$356M on the terminal before deciding to seek a buyer for it last year; it was built in anticipation of rising demand for crude-by-rail shipments, but lower oil prices have led to a sharp drop in shipments from western Canada.
Thu, Jun. 4, 5:58 PM
- Cenovus Energy's (NYSE:CVE) 135K bbl/day Foster Creek oil sands project and Canadian Natural Resources' (NYSE:CNQ) 80K bbl/day Primrose site now have been shut for a week after workers were evacuated when a wildfire threatened the two sites.
- But while the fire remains a threat, officials have allowed both companies to return some staff to their sites to prepare for normal operations.
- CNQ has resumed some production at its Kirby South project after a third-party pipeline shutdown, and the site began ramping up yesterday.
- Though the two companies had combined production losses of more than 1M barrels of oil, neither has issued a warning that the project shutdowns will impact their Q2 earnings or revised production estimates.
Mon, Jun. 1, 5:33 PM
- Firefighters report some progress fighting wildfires in Alberta's oil producing region but a number of oil sands projects remain shut down, keeping ~10% of total oil sands production offline.
- The number of fires has dropped to 35 from 42 on Friday, with five considered out of control.
- The wildfire hazard in the Lac la Biche region, where Cenovus Energy (NYSE:CVE) and Canadian Natural Resources (NYSE:CNQ) evacuated their respective Foster Creek and Primrose projects more than a week ago, was downgraded today to “moderate” from “extreme” by Alberta's government.
- CVE also evacuated workers from its non-producing Narrows Lake site last week due to a different fire, and says that blaze is now under control.
- Statoil (NYSE:STO) had evacuated non-essential staff from its Leismer oil sands project with no impact to production, and now says it hopes to remobilize evacuated workers this week.
- A wildfire burning near MEG Energy’s (OTCPK:MEGEF) Christina Lake site also remains out of control.
Wed, May 27, 2:37 PM
- Wildfires in northern Alberta have spread farther into the oil sands area, prompting the shutdown of ~230K bbl/day of production and keeping ~10% of the province's output offline.
- Cenovus Energy (CVE -0.7%) said yesterday it evacuated workers from its Narrows Lake oil sands project and Birch Mountain natural gas plant because of the fires; Narrows Lake is not yet producing, and workers were finishing the camp project there when they were evacuated.
- CVE already had closed its 135K bbl/day Foster Creek operations and evacuated 1,700 workers, Canadian Natural Resources (CNQ -0.6%) has cut 18K bbl/day of output at its Kirby South oil sands operation and 80K bbl/day from its Primrose facility, MEG Energy (OTCPK:MEGEF) halted operations at its Christina Lake site, and Statoil (STO -0.3%) says its Leismer site remains in operation but it will evacuate non-essential staff.
- Economists warn that the fires could further cut Canada’s GDP, already hit by the collapse in oil prices; oil sands extraction directly accounts for 2% of GDP but total energy extraction and support activities account for 6% of GDP, Bank of America says.
Tue, May 26, 6:33 PM
- Cenovus Energy (NYSE:CVE) says it will replace four executives on its eight-person leadership team during the year, but the multiple retirements cause some analysts and investors to speculate that the moves really are about saving money.
- "It’s cost-cutting, which makes sense because the company was staffed and built to really grow oil sands production,” says Brompton Group's Laura Lau.
- The internal replacements signal that the changes were not a board-mandated shakeup, otherwise the company would bring in external replacements, but the timing raises questions about what might be going on internally, according to money manager John Stephenson.
- However, CVE is launching an executive search to replace executive VP and COO John Brannan; CVE says it will not appoint a new COO but replace the role with a president of upstream oil and gas, to be named in September.
Tue, May 26, 10:18 AM
- Canadian Natural Resources (CNQ -2.7%) shut production yesterday from its Kirby South oil sands operation in Alberta, raising the amount of production brought offline because of the nearby forest fire that began earlier in the weekend to 233K bbl/day, or ~10% of the province’s total oil sands output.
- CNQ already had shut 80K bbl/day of production at its Primrose facility, and Cenovus Energy (CVE -2.7%) had closed its 135K bbl/day Foster Creek operations in Alberta.
- MEG Energy (OTCPK:MEGEF) also said it had suspended operations at its Christina Lake oil sands project and moved non-essential staff from the site due to the potential risk of the fires.
Mon, May 25, 12:11 AM
- Cenovus Energy (NYSE:CVE) has shut down operations at the 135K bbl/day Foster Creek oil sands project and Canadian Natural Resources (NYSE:CNQ) closed its 80K bbl/day Primrose project after a forest fire broke out on the Cold Lake Air Weapons Range in Alberta.
- CVE and ConocoPhillips (NYSE:COP) each own 50% of Foster Creek, with CVE's share of the production representing 31% of total company-wide average oil output of 218K bbl/day; Primrose's production represents less than 10% of CNQ's total corporate output.
- More than 7% of Canada's oil sands production has been shut down by the fire, which started Friday and is considered "out of control."
Fri, May 15, 2:45 PM
- Canada says it is committing to cut greenhouse gas emissions by 30% below 2005 levels by 2030, partly by introducing new regulations on its oil and gas sector.
- Environment Minister Aglukkaq says Canada will cut its emissions to 515 metric megatons by 2030 from 726 metric megatons in 2013; earlier this week, Ontario - Canada’s most populous province - set its own 2030 target of 112 megatons, which would represent a 46% cut from 2005 levels.
- To meet the new target, Canada will develop regulations to cut methane emissions from the oil and gas sector, such as industrial leaks and gas flares, as well as new rules to control emissions from the electricity and chemical sectors, including from nitrogen fertilizers.
- Relevant tickers: SU, ENB, TRP, IMO, CNQ, CVE, TCK, TAC, OTCQB:HUSKF, OTCQX:COSWF
Thu, May 7, 6:25 PM
- Canadian oil producers plunged for a second straight day as "all bets are off" after election results in Alberta raised concerns over the possibility of higher taxes for the companies.
- Among today's losers: SU -2.6%, OTCQB:HUSKF -5.2%, GTE -5.8%, PWE -5.7%, IMO -1%, CVE -1%, OTCQX:COSWF -3.4%, OTCPK:MEGEF -5%.
- COSWF is among the most exposed to a potential hike in royalties and stricter environmental policies, while electricity supplier TransAlta (NYSE:TAC) would suffer from the new government’s vow to shut coal plants sooner than planned, according to analysts at BMO Nesbitt Burns and RBC Dominion.
- Advice is split on owning stocks of companies that transport and process fuels in Alberta; Raymond James says stocks such as TransCanada (NYSE:TRP) and Enbridge (NYSE:ENB) are less directly exposed to reduced investment in the sector, but RBC advises to sell pipeline and midstream companies with operations in Alberta.
- Analysts also are divided about how much producers with oil refineries, such as SU and IMO, could offset losses from potentially higher royalties by boosting processing of crude in Alberta, a move pro-labor NDP has pledged to support.
CVE vs. ETF Alternatives
Cenovus Energy Inc is an integrated oil company. The Company is in the business of developing, producing and marketing crude oil, NGLs and natural gas in Canada with refining operations in the United States.
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