Thread regarding Cenovus Energy layoffs

Excellent Q1 Operational Update Today

The move to reduce production rates and store excess bbl in the reservoirs will ultimately get to better overall profit. Better to hold back, keep oil in inventory for later sale at higher prices (lower discount). The Gulf refiners will be begging for heavy oil to run efficiently as Venezuela produces less.

For the same profit better to have (low volume)(high margin) rather than (high volume)(low margin).

Good to read about working with rail operators to resolve some of the transportation issues.

Press release seems to have an air of a rough Q1. Maybe it's a bottom with light at the end of the tunnel. Always looks worse, feels worse at the bottom.

by
| 2114 views | | 9 replies (last ) | Reply
Post ID: @OP+Sky4aHF

9 replies (most recent on top)

Cenovus is a good company!

by
| | Reply
Post ID: @5uvt+Sky4aHF

In the end it will help same as OPEC cuts effect on world oil prices.

by
| | Reply
Post ID: @3ftd+Sky4aHF

This is not a strategic or voluntary cut. CVE is cutting because of pipeline curtailment. Their production is externally limited because of pipeline access and unavailable rail.

If we had takeaway capacity we would be producing at full rates. Saying we are doing this as some sort if market response to pricing is disingenuous.

by
| | Reply
Post ID: @2eek+Sky4aHF

Capex already spent is a sunk cost. Just need to cover the interest. Most debt is from recent acquisition; the debt is being reduced.

by
| | Reply
Post ID: @gku+Sky4aHF

Smartest moves are generally the first time people heard of them.

by
| | Reply
Post ID: @oai+Sky4aHF

This is the first time I hear a oil company saying we should produce slower. You should have thought about this before sinking in the CAPEX. Now you are LOSING money by keeping production down, because you are paying interest on those costs. Also interest rates are going up as you wait. Yeah, brilliant strategy...

by
| | Reply
Post ID: @ebu+Sky4aHF

Wondering how long before the discount tightens. Thoughts?

by
| | Reply
Post ID: @jff+Sky4aHF

Yeah, the CEO really does know what he is doing. Nice change, employees are lucky he came aboard. Do hope the strategy works.

by
| | Reply
Post ID: @edi+Sky4aHF

CVE promoter?

by
| | Reply
Post ID: @fkj+Sky4aHF

Post a reply

: