Cenovus Energy (NYSE:CVE) is a Canadian-based large-cap integrated energy company. The company was formed in 2009 with the split of Encana and is, or was, the oil-focused branch of the business. Including its predecessor, Cenovus Energy Inc can trace its roots back to the 1880s and the first Canadian transcontinental railroad. The founders of the railroad received mineral-rich land grants as part of their reward and those land rights were levered into the energy companies we know today.
Since the split, Cenovus Energy Inc. has made some major investments by buying out partner stakes in joint ventures and acquiring independent companies as well. Two major acquisitions, one in 2017 and the other in 2021, grew Cenovus Energy Inc. to be Canada’s 3rd largest producer of crude and natural gas and its 2nd largest refiner. Cenovus Energy Inc. is located in Calgary, Alberta.
Today, Cenovus Energy explores, produces, and markets crude oil and natural gas in North America and Asia. The company operates through 4 primary segments that include Oil Sands, Conventional, Offshore, Upgrading & Refining, and Value Chain. The oil sands segment is the core of the business and includes 3 primary projects that are Foster Creek, Christina Lake and Sunrise in northern Alberta, and Saskatchewan.
The Conventional segment operates in western Canada and holds deposits of natural gas and natural gas liquids. These projects are located in Elmworth-Wapiti, Kaybob-Edson, Clearwater, and Rainbow Lake. Holdings include upstream production as well as mid and downstream pipelines, storage, and delivery assets.
The offshore segment operates primarily in Labrador, Newfoundland, and the Asia-Pacific region specifically Indonesia and offshore China. This segment is engaged primarily in the exploration, development, and production of natural gas and crude oil fields.
The Upgrading & Refining segment has operations in the U.S. and Canada including 3 wholly-owned and 2 partially-owned refineries, midstream pipelines, and storage facilities. Its addition to the portfolio not only expanded revenue and earnings but helps reduce exposure to oil price volatility.
The Value Chain segment of the business has operations across all aspects of the value chain to help develop, transport, store, market and deliver natural gas, natural gas liquids and crude oil products in Canada and the US. The company’s network is not only vertically integrated but physically as well which is another factor that helps reduce exposure to oil market volatility. Among the many products offered are asphalt, natural gas, petcoke, ethanol, sulfur and transportation fuels. Petcoke, ironically, is a stable fuel derived from heavy oil that is used for electrical power generation.
The company is investing heavily in the future to include carbon storage. The company has committed to reducing its absolute GHG emission by 35% by 2035 and to achieving Net-0 carbon by 2050. The plan is to invest in technology to increase efficiency and electrify large portion of operations
