Cenovus sells Suffield for $416M to International Petroleum
Canada’s Cenovus Energy Inc has reached an agreement to sell a Suffield oil and gas resources for $512 million to International Petroleum Corp, distinguished a second understanding this month as it pushes forward with a debt rebate plan.
Calgary-based Cenovus pronounced on Monday deduction from a sale will be used to cut a $3.6 billion in debt it took on to buy oil sands resources from ConocoPhillips this year. Cenovus is targeting $5 billion from item sales to compensate down a debt and so distant it has announced $1.5 billion in divestitures, including a latest sale.
Cenovus shares rose as most as 3.9 per cent to $13.18 in early morning trade, before retreating to $12.71 by late morning. The benchmark Canada share index was flat..
Analysts pronounced a cost tab for Suffield was within estimates, and that while a sale was certain for a company, other resources for sale might not be as appealing to buyers.
“On balance, we continue to suggest investors take a discreet position toward a broader item sale routine for Cenovus,” pronounced Raymond James researcher Chris Cox, adding that other sales might “disappoint to a downside.”
The $16.8 billion ConocoPhillips understanding effectively doubled Cenovus’ producing assets, though dented a primitive change piece and sent Cenovus shares tumbling. It stirred some investors to rebel and resulted in a abdication of arch executive Brian Ferguson.
International Petroleum Corp, a spinoff of Norway’s Lundin Petroleum AB, pronounced a merger some-more than triples a prolongation and reserves. Its shares jumped 6.5 per cent to $5.22.
Earlier this month, Cenovus concluded to sell a Pelican Lake complicated oil operations in Alberta for $975 million to Canadian Natural Resources Ltd.
Other resources Cenovus skeleton to sell embody a company’s Weyburn and Palliser oil assets, that it hopes to announce by a finish of a year. It might also sell some of a Deep Basin healthy gas resources that it acquired from ConocoPhillips.
Reuters reported in Jul a association hopes to lift as most as $2.5 billion by offered Weyburn and Palliser oil assets, in-line with analysts’ valuations.
Desjardins researcher Justin Bouchard pronounced Deep Basin’s infrastructure resources could be sole for adult to $1.5 billion, assisting a association accommodate or even transcend a divestiture target.
Article source: http://www.cbc.ca/news/business/cenovus-suffield-international-petroleum-1.4305795?cmp=rss