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Crescent Point reportedly
seeks to sell assets
WESTERN CANADIAN light oil producer Crescent Point Kaybob Duvernay properties for CAD900mn
CANADA Energy is reportedly seeking to sell some of its ($709mn) in February 2021. In June, Crescent
assets in Alberta and Saskatchewan. According Point sold some of its conventional assets in
to Reuters, which cited an industry source, as Saskatchewan for CAD93mn ($73mn). The
well as marketing documents it had seen this company announced in December that it would
week, the assets could fetch around CAD500mn raise its quarterly dividend by 50% and would
($394mn). be making up to CAD100mn ($79mn) worth
The marketing documents show that Cres- of share repurchases. These moves also illustrate
cent Point is offering the assets in three sepa- a broader trend of oil and gas producers trying
rate packages that had combined production of to shore up their balance sheets and prioritise
10,554 barrels of oil equivalent per day (boepd) shareholder returns.
in the fourth quarter of 2021. The documents According to that December announce-
also show that including undeveloped acreage, ment, Crescent Point is targeting production of
the properties have a net present value (NPV) of 133,000-137,000 boepd in 2022, up from the pre-
roughly CAD834mn ($657mn). vious guidance of 131,000-135,000 boepd. The
The report comes as oil and gas companies company’s capital expenditure budget for 2022
in both the US and Canada are continuing to remained unchanged from an initial guidance of
take advantage of improved conditions for sell- CAD825-900mn ($650-709mn).
ing assets, with oil prices at their highest level in The marketing documents seen by Reuters
around seven years. Crescent Point is reported show that National Bank Financial Markets has
to have been seeking to shed some of its non- been retained as Crescent Point’s adviser on the
core assets since it bought Royal Dutch Shell’s planned Alberta and Saskatchewan asset sale.
PERFORMANCE
Cenovus reports fourth-quarter
loss on one-time charge
NORTH AMERICA CANADA’S Cenovus Energy has posted a returns. These moves are in line with what many
net loss of CAD408mn ($320mn) for the oil and gas companies are currently treating as
fourth quarter of 2021, down from a profit of priorities.
CAD551mn ($433mn) in the third quarter of Cenovus’ CEO, Alex Pourbaix, said the com-
last year and a loss of CAD153mn ($120mn) in pany was still treating the improved price envi-
the final quarter of 2020. ronment with caution following the volatility of
The company attributed the loss primarily recent years.
to a one-time non-cash impairment charge of “I’m kind of old enough and bear enough
CAD1.9bn ($1.5bn) in its US manufacturing scars that I guess when it comes to pricing, I’m
segment. The segment was hit by operational always very cautious,” Pourbaix said on the
issues at two refineries during the fourth quarter. company’s earnings call. “We anchor all of this
The loss comes after other leading Canadian company’s development plans at the bottom of
oil and gas producers posted fourth-quarter the cycle for oil and gas. We won’t invest in a pro-
profits, bolstered by oil prices rising to their ject that doesn’t deliver an acceptable return at
highest level in several years. And indeed, Ceno- the bottom of the cycle, which for oil, we would
vus talked up other aspects of its performance, describe as kind of $45 WTI, so although we’re
noting that it had generated CAD2.2bn ($1.7bn) pleased to see these higher prices, it’s just not
worth of cash from operating activities in the something we can count on now.”
fourth quarter, up from CAD250mn ($196mn) Despite this, he said Cenovus had “quite an
a year ago. It also benefited – over the whole of active” programme in both the oil sands and its
2021 – from its acquisition of Husky Energy at conventional business.
the start of the year. The company’s output reached 825,300 bar-
The company said it was rapidly reducing rels of oil equivalent per day in the fourth quar-
its net debt to CAD8bn ($6.3bn) and that it ter, which included record oil sands production
would soon unveil plans to increase shareholder of 626,900 boepd.
P8 www. NEWSBASE .com Week 06 10•February•2022