Cenovus Energy, one of Canada's biggest oil and gas companies, expects to spend more capital next year compared to 2023 to boost upstream production and capture better margins in the downstream segment.
In a corporate update on Thursday, Cenovus Energy said that its 2024 budget entails capital investments of US$3.3 billion-US$3.7 billion (C$4.5 billion and C$5.0 billion), "delivering disciplined capital investment and balancing growth of the company's base business with meaningful shareholder returns."
The investment will include up to US$1.5 billion (C$2 billion) of optimization and growth capital, which will go primarily for progressing the West White Rose project and growing production at the Foster Creek, Christina Lake, and Sunrise oil sands facilities.
Cenovus Energy guides for total upstream production of between 770,000 and 810,000 barrels of oil equivalent per day (boepd) next year, with production from oil sands and thermal projects expected at between 590,000 and 610,000 barrels per day (bpd), which reflects a turnaround at Christina Lake in the third quarter of 2024. Total production volumes are set to rise in 2024 compared to the guidance for this year at 775,000 boepd to 795,000 boepd.
In the downstream, crude throughput is expected to be between 630,000 bpd and 670,000 bpd, representing a crude utilization rate of approximately 87%, and includes 85,000 bpd to 95,000 bpd of crude throughput in the Canadian Refining segment.
"We will continue to progress strategic initiatives in our base business in 2024 that will enhance our integrated operations and further drive our ability to grow total shareholder returns, even in periods of price volatility," Cenovus president and CEO Jon McKenzie said in a statement.
Tie-backs to existing oil sands facilities or expansion of operational sites by some of the biggest Canadian oil firms are expected to boost Canada's crude oil production by 8% by 2025, analysts said earlier this year.
By Tsvetana Paraskova for Oilprice.com
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More