Morningstar Rating

Stock Research and Analysis

by Jason Stevens

Bulls Say

Cenovus has some of the highest-quality in situ oil sands leases in the Athabasca region, with a development plan that spans decades.
As Cenovus deploys its Wedge Wells across its Christina Lake and Foster Creek projects, we look for operating costs to trend lower and cash flow to increase.
Its 2007 JV has allowed Cenovus to secure downstream assets (JV with Phillips 66) that have provided some insulation against heavy oil price differentials. Read more 

Bears Say

With all its producing assets in Western Canada, Cenovus is completely exposed to the inflation that is rampant there, especially in the Athabasca region. This could hurt returns on future projects.
While its downstream assets are proving to be advantageous in periods with wide heavy oil differentials, a narrowing of differentials could diminish the gains from these assets.
While Pelican Lake should produce strong returns, the potential for rapid declines and long production lags associated with polymer flooding could cause Cenovus to miss on production and operating costs. Read more 

Management

Brian Ferguson became president and CEO of Cenovus in November 2009 when the company was split off from Encana. His history with Cenovus and Encana runs deep, going back to 1984 when he first joined Alberta Energy, the predecessor to Encana. We have   Read more 

Profile

Cenovus Energy is an oil-weighted E&P producing over 250,000 boepd (70% oil) from its Canadian assets, which include over 100,000 bpd from its oil sands leases. While   Read more 

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