Husky Energy is cutting $800 million from its capital spending plans for this year and suspending its dividend as it copes with the deep rout in crude prices.
The moves come as the U.S. benchmark price for crude oil has sunk below US$30 a barrel.
Husky's capital budget for 2016 is now pegged at between $2.1 billion and $2.3 billion, down from a previous range of $2.9 billion to $3.1 billion.
The Calgary-based company (TSX:HSE) introduced a stock dividend in the third quarter in lieu of a cash payout, but given the weak outlook for oil prices, Husky says it's suspending its dividend altogether for the fourth quarter.
The company is also trimming 15,000 barrels of oil equivalent a day from its projected 2016 production targets.
And it is looking to sell holding in Western Canada that together produce 55,000 barrels of oil equivalent a day and is exploring the partial sale of pipeline and storage assets.
"We continue to take decisive action in this period of persistent supply-demand imbalance," CEO Asim Ghosh said in a release.
"These actions are in line with the principles we have established, namely, balancing capital spending with cash flow and maintaining a strong balance sheet. Our fundamental goal remains unchanged — the steps we are taking will see Husky emerge from this cycle as a more resilient and more profitable company."
Meanwhile, Whitecap Resources Inc. (TSX:WCP) has also cut its 2016 budget, reducing planned spending by 53 per cent from what it outlined a month ago to $70 million.
The company also reduced its dividend by 40 per cent to free up $91 million in cash annually.