1 About Cenovus Oil sands Oil sands drilling projects in northern Alberta Refineries 50 percent ownership in two U.S. refineries Conventional assets Established conventional oil and natural gas assets in Alberta and…
2017 priorities ? Increasing oil production by 14% ? Holding the line on per barrel oil operating costs ? Resuming construction of Christina Lake phase G ? Allocating growth capital to attractive conventional opportunities at…
Clear capital allocation priorities Safe & reliable operations Sustainable returns to shareholders Value added growth Discretionary capital Maintenance & oil sands sustaining capital Dividends must be sustainable at every…
Phase G builds on Christina Lake success Best-in-class oil sands project ? Proven track record in project development ? Industry-leading steam-oil ratio ? Low capital efficiencies ? leveraging pre-installed infrastructure Realizing…
Liquidity position supports financial resilience 0% 10% 20% 30% 40% 50% 60% - 2 4 6 8 10 12 14 Total liquidity ($ billions) 2017F net debt to capitalization vs. total liquidity Net debt to capitalization ratio Cenovus…
Net debt calculated as total debt less cash and cash equivalents. Long-dated debt maturities ? US$4.75 billion in notes with weighted average maturity of ~15 years ? No maturities until Q4 2019 Maintaining balance sheet strength a…
$0.00 $2.50 $5.00 $7.50 $10.00 $12.50 $15.00 2014 2015 2016 2017F Becoming a low cost energy producer ? 31% reduction to G&A ? Improved efficiencies, workforce optimization and reduced discretionary spending ? 32% reduction to…
$14.00 $10.50 $7.00 $7.25 $0.00 $5.00 $10.00 $15.00 2014 2015 2016 2017F Innovation drives sustaining capital reductions Examples of expected efficiency gains ? Quicker drilling times: up to 30% faster ? Redesigned well pads:…
Expected impacts ? Design philosophy that uses a zero-base* approach to well pair and pad designs ? Materially reduces costs while maintaining safety, compliance and production ? 40% ? 60% material reduction ? 15% ? 20% well pad…
Continued improvements in well design 0% 5% 10% 15% 20% 25% 30% 0 3 6 9 12 15 18 21 24 27 30 33 36 Recovery factor Months on production W10 Pad (2016?04) W07 Pad (2016?02) W08 Pad (2015?03) E08 Pad (2013?10) W02 Pad (2011?09)…
Foster Creek overview Foster Creek production history Phase C Phase D,E Phase F Phase G Phase A Phase B Key facts and reservoir characteristics Current productive capacity phases A-G (bbls/d) 180,000 Regulatory approved…
0 25 50 75 100 125 150 175 200 225 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017F Mbbls/d Production is shown before royalties on a gross basis. 2017F production based on…
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 0 200 400 600 800 1,000 1,200 1,400 Production/well (bbls/d) Top tier well performance and SOR Christina Lake Foster Creek Low SOR means ? Lower capital cost ? Lower operating cost ?…
Leading environmental performance Cenovus?s direct oil sands GHG emissions intensity is: ? 45% below industry average* ? down 35% since 2004 Outcome of top quartile SOR performance and technology such as: ? Wedge Well? technology…
Strategy remains unchanged ? Free funds flow used to fund oil sands growth opportunities ? total free funds flow from A&D proceeds and operations of $9.7 billion to date since 2010 ? Flexible capital investment to respond to…
Palliser block tight oil in Southern Alberta Large inventory of multi-zone tight oil locations on Southern Alberta lands ? Over 1,200 sections of leased and available Mannville oil lands ? 10-year option exclusive to Cenovus ?…
Palliser block tight oil in Southern Alberta Large inventory of multi-zone tight oil locations on Southern Alberta lands ? Over 1,200 sections of leased and available Mannville oil lands ? 10-year option exclusive to Cenovus ?…
Refineries have access to discounted crudes ? Wood River accesses multiple pipelines: Keystone, Express-Platte, Mustang, Ozark ? Borger has access to Canadian heavy, West Texas Sour and growing Permian supply Wood River debottleneck…
PADD V PADD IV PADD III PADD I Alberta Borger Refinery Wood River Refinery PADD II Hardisty Kitimat Montreal Saint John Houston Cushing Chicago Pipeline expansion Proposed pipeline Edmonton Patoka Vancouver Current…
Long-term optionality to ship 10% ? 20% of corporate volumes by rail Taken delivery of 825 coiled and insulated rail cars Secured 70,000 bbls/d of loading capacity between: ? Bruderheim Energy terminal (Edmonton) ? USDG/Gibsons…
Capital Total capital ~$9 - $10/bbl full cycle $2 - $3/bbl Growth capital ? Phase expansion (includes all infrastructure and initial wells) ? Phase debottlenecking and optimization ? Numerator for capital efficiency calculation…
SAGD portfolio provides development opportunity and growth potential Totals may not add due to rounding. For additional information about our economic contingent resources please see the advisory. There is uncertainty that it will be…
Narrows Lake commercial project SAP ? First commercial SAGD project to incorporate solvent aided process (SAP) ? Evaluating development options to leverage existing infrastructure at nearby Christina Lake project ? Expected initial…
Telephone Lake and Grand Rapids Telephone Lake commercial project ? Regulatory approval received in 2014 ? Continuing engineering work; assessing development options ? Estimated project SOR ? 2.1 ? Expected initial production…
Creating value through social and governance performance Committed to good governance ? SER Committee of the Board provides oversight of environment and sustainability performance ? Enterprise Risk Management program, practices and…
Advancing our environmental performance Rigorous regulatory framework ensures environment considerations throughout project lifecycle Dedicated internal environment team focused on mitigating environmental risks Ongoing technology…
Hedging summary US$ hedge prices converted to C$ at 0.7448 US$/C$ December 31, 2016 Bank of Canada noon day rate. Percentages of production are based on 2017 guidance document dated December 8, 2016. $50.00 $55.00 $60.00 $65.00…
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