CALGARY — Cenovus Energy Inc. says it has been running its oilsands operations at reduced production rates and storing excess barrels due to wider-than-normal light-heavy oil price differentials and pipeline capacity constraints.
The company says it has been operating its Christina Lake and Foster Creek facilities at reduced production levels since February.
Cenovus chief executive Alex Pourbaix says when Canadian heavy oil is selling at a wide discount to West Texas Intermediate due to transportation bottlenecks, the company has significant capacity to store barrels in its reservoirs to be produced and sold at a later date.
Cenovus is also evaluating opportunities to optimize the scheduling of maintenance and holding talks with rail providers to resolve a shortage of locomotive capacity.
The company noted that while the strategy may result in fluctuating production from month to month, it continues to expect full-year oilsands volumes for 2018 to be within the its guidance of 364,000 to 382,000 barrels per day.
First-quarter oilsands production is expected to be between 350,000 and 360,000 barrels per day.
Companies in this story: (TSX:CVE)