Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) has entered into an agreement to sell its majority interest in the Weyburn carbon-dioxide enhanced oil recovery operation in Saskatchewan for cash proceeds of $940 million. The sale is expected to close in the fourth quarter of 2017, subject to customary closing conditions.
The previously announced sale of Cenovus’s Pelican Lake assets closed on September 29, 2017 and the company still anticipates the previously announced sales of its Palliser and Suffield assets to close later this year.
“We’re pleased with the progress we’ve made in delivering on our divestiture plan to optimize our portfolio and deleverage the company’s balance sheet,” said Alex Pourbaix, Cenovus President & Chief Executive Officer. “Net proceeds from the Weyburn asset sale, combined with the other three divestitures announced earlier this fall, will position us to retire the entire $3.6 billion bridge facility associated with the ConocoPhillips asset purchase by the end of 2017.”
The company is focused on using cash flow from its operations and asset sale proceeds to achieve its target of being below two times net debt to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA).
TD Securities Inc. acted as exclusive financial advisor to Cenovus on the Weyburn transaction.