Canadian Natural Resources Buys Cenovus Assets for $787 Million
September 05 2017 - 8:15AM
Dow Jones News
By Cara Lombardo
Canadian Natural Resources Ltd. has agreed to buy Cenovus Energy
Inc.'s Pelican Lake heavy oil operations and other assets in
northern Alberta for 975 million Canadian dollars ($787 million),
the companies said Tuesday.
The deal will allow Canadian Natural Resources to expand
existing heavy oil and polymer operations at Pelican Lake. Canadian
Natural Resources plans to produce about 19,600 barrels of oil
equivalents a day, or less than 3% of the company's rate of
production last year.
The companies expect the transaction to close by the end of the
month.
Cenovus has embarked on a divestiture campaign after closing on
a $13.3 billion deal with ConocoPhillips earlier this year to
acquire full ownership of its oil-sands operations and a production
platform in the Deep Basin in northwestern Alberta and British
Columbia. The company said it wants to reach deals to sell between
C$4 billion and C$5 billion of its conventional oil and natural-gas
assets this year.
Cenovus said it will use the sale proceeds to retire the first
tranche of a bridge loan it used to fund the ConocoPhillips asset
purchase.
Cenovus shares are down 51% this year. The stock has lost 43% of
its value since late March after the announcement of the
ConocoPhillips deal.
Canadian Natural Resources shares are down 9% so far this
year.
Write to Cara Lombardo at cara.lombardo@wsj.com
(END) Dow Jones Newswires
September 05, 2017 08:00 ET (12:00 GMT)
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