UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 
under the Securities Exchange Act of 1934
 
For February 2024
Commission File Number:  1-34513

CENOVUS ENERGY INC.
(Translation of registrant’s name into English)
4100, 225 6 Avenue S.W.
Calgary, Alberta, Canada T2P 1N2
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F  ☐    Form 40-F  ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):   ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):   ☐
DOCUMENTS FILED AS PART OF THIS FORM 6-K
See the Exhibit Index to this Form 6-K.


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date:  February 15, 2024
 
CENOVUS ENERGY INC.
(Registrant)

By:/s/ Christine D. Lee
Name:Christine D. Lee
Title:Assistant Corporate Secretary



Form 6-K Exhibit Index
 
Exhibit No.
News Release dated February 15, 2024
Interim Consolidated Financial Statements (unaudited) for the period ended December 31, 2023


Exhibit 99.1
News release

logo1.gif

Cenovus announces fourth-quarter and full-year 2023 results

Calgary, Alberta ([February 15, 2024]) – Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) continued to deliver strong operational performance across the portfolio in the fourth quarter of 2023. The company's upstream assets performed exceptionally well, achieving the second-highest quarterly production rates in Cenovus’s history. In its downstream business, the company continued to build operating momentum at its wholly-owned refineries. Upstream and downstream results were negatively impacted by a rapid decline in commodity prices and refinery crack spreads in the quarter. This was compounded by the cost of processing crude oil in the downstream that was purchased in prior periods at higher prices.

“As expected, upstream operating performance was excellent through the final months of the year. This period also marked the second full quarter that our full suite of operated refining assets were available to us and I am very pleased with our progress,” said Jon McKenzie, Cenovus President & Chief Executive Officer. “With the work done in 2023, we are well positioned to continue capturing more margin across our businesses.”

Fourth-quarter and year-end highlights

•Achieved a strong upstream exit rate in 2023, with fourth quarter average production of 809,000 barrels of oil equivalent per day (BOE/d)1.
•Returned a total of $731 million to shareholders in the fourth quarter, including the payment of the remaining warrant purchase liability. In 2023, returned $2.8 billion to shareholders, including $1.1 billion through share buybacks, $1.0 billion through common and preferred share dividends and $711 million on the purchase and cancellation of common share warrants.
•Reduced net debt by $916 million in the fourth quarter, to $5.1 billion. Long-term debt, including the current portion, was $7.1 billion at the end of the fourth quarter, a reduction of $1.6 billion compared with year-end 2022, and reflects the continued strengthening of our capital structure with the repurchase of US$1 billion of long-term debt in 2023.


Financial, production & throughput summary
For the period ended December 31
2023 Q42023 Q32022 Q42023 FY2022 FY
Financial ($ millions, except per share amounts)
Cash from (used in) operating activities2,9462,7382,9707,38811,403
Adjusted funds flow2
2,0623,4472,3468,80310,978
Per share (diluted)2
1.091.811.194.575.47
Capital investment1,1701,0251,2744,2983,708
Free funds flow2
8922,4221,0724,5057,270
Excess free funds flow2
4711,989786
Net earnings (loss)7431,8647844,1096,450
Per share (diluted)0.390.970.392.123.20
Long-term debt, including current portion7,1087,2248,6917,1088,691
Net debt5,0605,9764,2825,0604,282
Production and throughput (before royalties, net to Cenovus)
Oil and NGLs (bbls/d)1
662,600652,400664,900640,000641,900
Conventional natural gas (MMcf/d)876.3867.4852.0832.6866.1
Total upstream production (BOE/d)1
808,600797,000806,900778,700786,200
Total downstream throughput (bbls/d)
579,100664,300473,300560,400493,700
1 See Advisory for production by product type.
2 Non-GAAP financial measure or contains a non-GAAP financial measure. See Advisory.
CENOVUS ENERGY NEWS RELEASE | 1


Fourth-quarter results

Operating results1

Cenovus’s total revenues were approximately $13.1 billion in the fourth quarter of 2023, down from $14.6 billion in the third quarter. Upstream revenues were about $6.9 billion, a decrease from $7.6 billion in the previous quarter, while downstream revenues were approximately $8.4 billion, compared with $9.7 billion in the third quarter of 2023. Total operating margin3 was about $2.2 billion, compared with $4.4 billion in the third quarter. Upstream operating margin4 was approximately $2.5 billion, a decrease from $3.4 billion in the previous quarter, primarily driven by a wider light-heavy differential and lower Brent and West Texas Intermediate (WTI) crude oil prices. Cenovus had a downstream operating margin4 shortfall of $304 million, compared with an operating margin of $922 million in the third quarter. Operating margin in U.S. Refining was impacted by approximately $430 million comprising first-in, first-out (FIFO) losses and a non-cash write-down of refined product and crude oil inventory.

Total upstream production was 808,600 BOE/d in the fourth quarter, an increase of approximately 12,000 barrels per day (bbls/d) from the third quarter, as the company progressed the start-up of new oil sands well pads and the Terra Nova field returned to production in November. Foster Creek volumes increased to 198,800 bbls/d, from 189,300 bbls/d in the third quarter and Christina Lake production was 239,600 bbls/d, in line with the third quarter. Sunrise produced 50,100 bbls/d and continued to show strong results from its redevelopment program. At the Lloydminster thermal projects, production of 106,600 bbls/d was in line with the prior quarter. Overall, Oil Sands operating costs per barrel were $10.96, a reduction of 13% from the third quarter of 2023, reflecting higher sales volumes and lower natural gas prices.

Production in the Conventional segment was 123,800 BOE/d in the fourth quarter, a decrease from 127,200 BOE/d in the third quarter. Cenovus experienced higher production rates from certain wells in the third quarter following shut-ins that occurred in the second quarter of 2023 due to the Alberta wildfires.

In the Offshore segment, production was 70,200 BOE/d compared with 66,400 BOE/d in the third quarter. In Asia Pacific, sales volumes increased in the fourth quarter, reflecting production from the MAC field in Indonesia that began in the third quarter of 2023. In the Atlantic region, production was 9,700 bbls/d compared with 8,900 bbls/d in the prior quarter as the non-operated Terra Nova floating production, storage and offloading (FPSO) vessel resumed production offshore Newfoundland and Labrador.

Crude throughput in the Canadian Refining segment was 100,300 bbls/d in the fourth quarter, compared with crude throughput of 108,400 bbls/d in the third quarter. Throughput was reduced primarily due to an unplanned outage at the Lloydminster Upgrader in October, which returned to full rates in November.

In U.S. Refining, crude throughput was 478,800 bbls/d in the fourth quarter, compared with crude throughput of 555,900 bbls/d in the third quarter. Throughput was reduced primarily due to planned turnaround activity at the non-operated Borger Refinery and an unplanned outage delaying the start-up of the refinery post-turnaround. The Lima Refinery also underwent planned maintenance in the fourth quarter and a temporary unplanned outage. In response to the exceptionally weak refined products pricing environment in December, the company took the opportunity to economically optimize throughput across its refining network.



3 Non-GAAP financial measure. Total operating margin is the total of Upstream operating margin plus Downstream operating margin. See Advisory.
4 Specified financial measure. See Advisory.     
CENOVUS ENERGY NEWS RELEASE | 2        


Financial results

Fourth-quarter cash from operating activities, which includes changes in non-cash working capital, was about $2.9 billion, compared with $2.7 billion in the third quarter of 2023. Adjusted funds flow was approximately $2.1 billion, compared with $3.4 billion in the prior period and free funds flow was $892 million, a decrease from $2.4 billion in the third quarter. Fourth-quarter financial results were impacted by lower refined product pricing in the U.S. and lower price realizations in the Oil Sands segment, driven by wider light-heavy crude oil differentials. The December 2023 average Chicago 3-2-1 crack was US$7.65 per barrel, the lowest monthly average since 2020.

Net earnings in the fourth quarter were $743 million, compared with $1.9 billion in the previous quarter. The decrease in net earnings was primarily due to lower operating margin, which includes a non-cash write-down of $89 million in refined product inventory and crude oil inventory as a result of lower market pricing anticipated in the first quarter of 2024. These factors were partially offset by lower income taxes, lower general and administrative expenses due to lower long-term incentive costs and an unrealized foreign exchange gain compared with an unrealized loss in the third quarter.

Long-term debt, including the current portion, was reduced to $7.1 billion at December 31, 2023 compared with $7.2 billion at September 30, 2023, and $8.7 billion at December 31, 2022, mainly as a result of the company’s purchase of US$1.0 billion of outstanding notes in the third quarter of 2023. Net debt was approximately $5.1 billion at December 31, 2023, a decrease from $6.0 billion at September 30, 2023, primarily due to a draw in non-cash working capital in the quarter as a result of decreasing commodity prices and a volumetric draw of product in inventory as well as free funds flow of $892 million offset by shareholder returns of $731 million. Cenovus continues to make progress towards its net debt target of $4.0 billion.

Capital investment of $1.2 billion in the fourth quarter was primarily directed towards sustaining production in the Oil Sands segment, tie-ins and infrastructure projects in the Conventional business and sustaining activities in the Downstream segments. In addition, the company continues to progress its growth and optimization projects, including the West White Rose project, the tie-back of Narrows Lake to Christina Lake and Sunrise and Foster Creek optimizations.

Full-year results

In 2023, Cenovus’s total upstream production averaged 778,700 BOE/d, compared with 786,200 BOE/d in 2022, which reflects the impact of wildfire activity in Alberta in the second quarter of 2023 as well as the timing of sustaining well pads in the Oil Sands segment. Oil Sands crude oil production was 593,400 bbls/d, including 186,300 bbls/d at Foster Creek and 237,400 bbls/d at Christina Lake. Full-year production from the Lloydminster thermal projects was 104,100 bbls/d compared with 99,900 bbls/d in 2022, reflecting a full year of production from the company’s Spruce Lake North facility. Production from Sunrise was 48,900 bbls/d compared with 31,300 bbls/d in 2022, with the increase largely driven by the acquisition of the remaining 50% working interest in Sunrise, which closed in August 2022. Conventional production was 119,900 BOE/d compared with 127,200 BOE/d in 2022, with the decrease mainly related to the wildfire activity in Alberta in 2023. Offshore total production was 63,400 BOE/d, compared with 70,300 BOE/d in the prior year, reflecting lower production from the Atlantic region primarily due to turnaround work in 2023 and the unplanned outage in China in the second quarter of 2023.

U.S. Refining crude oil throughput increased to 459,700 bbls/d in 2023 compared with 400,800 bbls/d in 2022, reflecting the acquisition of the remaining 50% working interest in the Toledo Refinery and the restart of the Superior Refinery in 2023. In addition, 2022 throughput was impacted by higher levels of planned and unplanned maintenance.

CENOVUS ENERGY NEWS RELEASE | 3

Total revenues were about $52.2 billion in 2023 and total operating margin was $11.0 billion compared with revenues of $66.9 billion and total operating margin of $14.3 billion in 2022. Year-over-year decreases in both total revenues and total operating margin were largely related to lower commodity prices.

Cash from operating activities was $7.4 billion for 2023 compared with $11.4 billion in 2022. Adjusted funds flow was $8.8 billion and free funds flow was $4.5 billion. Total capital investment for 2023 was $4.3 billion, primarily concentrated on sustaining production at the company’s upstream assets, the construction of the West White Rose project and refining reliability initiatives. Full-year net earnings for 2023 were about $4.1 billion compared with $6.5 billion in 2022, primarily due to lower commodity prices.

Reserves

Cenovus’s proved and probable reserves are evaluated each year by independent qualified reserves evaluators. At the end of 2023, Cenovus’s total proved and total proved plus probable reserves were approximately 5.9 billion BOE and 8.7 billion BOE respectively, relatively unchanged compared to the prior year. Total proved and total proved plus probable bitumen reserves were approximately 5.4 billion barrels and approximately 7.9 billion barrels respectively, both relatively unchanged compared to the prior year. At year-end 2023, Cenovus had a proved reserves life index of approximately 21 years and a proved plus probable reserves life index of approximately 31 years.

More details about Cenovus’s reserves and other oil and gas information are available in the Advisory and the Management’s Discussion & Analysis (MD&A), Annual Information Form (AIF) and Annual Report on Form 40-F for the year ended December 31, 2023, available on SEDAR+ at sedarplus.ca, EDGAR at sec.gov and Cenovus’s website at cenovus.com.

Cenovus year-end disclosure documents

Today, Cenovus is filing its audited Consolidated Financial Statements, MD&A and AIF with Canadian securities regulatory authorities. The company is also filing its Annual Report on Form 40-F for the year ended December 31, 2023 with the U.S. Securities and Exchange Commission. Copies of these documents will be available on SEDAR+ at sedarplus.ca, EDGAR at sec.gov and the company's website at cenovus.com under Investors. They can also be requested free of charge by emailing investor.relations@cenovus.com.
CENOVUS ENERGY NEWS RELEASE | 4

Dividend declarations and share purchases

The Board of Directors has declared a quarterly base dividend of $0.14 per common share, payable on March 28, 2024 to shareholders of record as of March 15, 2024. In addition, the Board has declared a quarterly dividend on each of the Cumulative Redeemable First Preferred Shares – Series 1, Series 2, Series 3, Series 5 and Series 7 – payable on April 1, 2024 to shareholders of record as of March 15, 2024 as follows:

Preferred shares dividend summary
Share seriesRate (%)Amount ($/share)
Series 12.5770.16106
Series 26.7720.42094
Series 34.6890.29306
Series 54.5910.28694
Series 73.9350.24594

All dividends paid on Cenovus’s common and preferred shares will be designated as “eligible dividends” for Canadian federal income tax purposes. Declaration of dividends is at the sole discretion of the Board and will continue to be evaluated on a quarterly basis.

Cenovus’s shareholder returns framework has a target of returning 50% of excess free funds flow to shareholders for quarters where the ending net debt is between $9.0 billion and $4.0 billion. In the fourth quarter, the company returned $731 million to shareholders, composed of $111 million for the remaining payment of the common share warrants obligation, $350 million through its normal course issuer bid (NCIB) and $270 million through common and preferred share dividends. In 2023, the company returned $2.8 billion to shareholders through its NCIB, common and preferred share dividends and the purchase and cancellation of common share warrants.

2024 planned maintenance

The following table provides details on planned maintenance activities at Cenovus assets through 2024 and anticipated production or throughput impacts.

2024 planned maintenance
Potential quarterly production/throughput impact (Mbbls/d)
Q1
Q2
Q3
Q4
Annualized impact
Upstream
Oil Sands
—2-3
50 - 60
—
13 - 16
Atlantic
8-108-108-10—5-7
Conventional
—3-54-6—2-4
Downstream
Canadian Refining
—
42 - 46
——10-12
U.S Refining
20 - 24
12-16
30 - 34
56 - 60
30 - 35

Sustainability

In 2023, Cenovus made progress in several of its environmental, social and governance focus areas. The company announced a new milestone to reduce absolute methane emissions in its upstream operations by 80 percent by year-end 2028, from a 2019 baseline. In addition, Cenovus has reached its target of spending at least $1.2 billion with Indigenous businesses between 2019 and year-end 2025 and has achieved its aspiration to have at least 40% representation from designated groups among
CENOVUS ENERGY NEWS RELEASE | 5

non-management members of the Board of Directors, including at least 30% women, by year-end 2025.

Cenovus continues to work with its peers in the Pathways Alliance to advance company-specific projects in order to achieve its overall emissions reduction target. Additional certainty about shared funding commitments from governments is required for Cenovus and the Pathways Alliance to move forward with the large-scale capital investments necessary to meet their emissions reduction goals.

Chief Sustainability Officer update

Cenovus Chief Sustainability Officer & Executive Vice-President, Stakeholder Engagement, Rhona DelFrari, will be taking a one-year sabbatical starting May 2, 2024. Jeff Lawson, Cenovus Senior Vice-President, Corporate Development, will take on Rhona’s responsibilities and join the executive team during her absence.


Conference call today

9 a.m. Mountain Time (11 a.m. Eastern Time)

Cenovus will host a conference call today, February 15, 2024, starting at 9 a.m. MT (11 a.m. ET).
To join the conference call without operator assistance, please register here approximately 5 minutes in advance to receive an automated call-back when the session begins.

Alternatively, you can dial 888-664-6383 (toll-free in North America) or 416-764-8650 to reach a live operator who will join you into the call. A live audio webcast will also be available and will be archived for approximately 90 days.


Advisory

Basis of Presentation

Cenovus reports financial results in Canadian dollars and presents production volumes on a net to Cenovus before royalties basis, unless otherwise stated. Cenovus prepares its financial statements in accordance with International Financial Reporting Standards (IFRS) Accounting Standards.

Barrels of Oil Equivalent

Natural gas volumes have been converted to barrels of oil equivalent (BOE) on the basis of six thousand cubic feet (Mcf) to one barrel (bbl). BOE may be misleading, particularly if used in isolation. A conversion ratio of one bbl to six Mcf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil compared with natural gas is significantly different from the energy equivalency conversion ratio of 6:1, utilizing a conversion on a 6:1 basis is not an accurate reflection of value.







CENOVUS ENERGY NEWS RELEASE | 6

Product types

Product type by operating segment
Three months ended
December 31, 2023		Full year ended
December 31, 2023
Oil Sands
Bitumen (Mbbls/d)595.1576.7
Heavy crude oil (Mbbls/d)17.516.7
Conventional natural gas (MMcf/d)12.311.9
Total Oil Sands segment production (MBOE/d)614.6595.4
Conventional
Light crude oil (Mbbls/d)6.15.9
Natural gas liquids (Mbbls/d)22.821.7
Conventional natural gas (MMcf/d)569.6554.1
Total Conventional segment production (MBOE/d)123.8119.9
Offshore
Light crude oil (Mbbls/d)9.78.2
Natural gas liquids (Mbbls/d)11.410.8
Conventional natural gas (MMcf/d)294.4266.6
Total Offshore segment production (MBOE/d)70.263.4
Total upstream production (MBOE/d)808.6778.7

Forward‐looking Information

This news release contains certain forward‐looking statements and forward‐looking information (collectively referred to as “forward‐looking information”) within the meaning of applicable securities legislation about Cenovus’s current expectations, estimates and projections about the future of the company, based on certain assumptions made in light of the company’s experiences and perceptions of historical trends. Although Cenovus believes that the expectations represented by such forward‐looking information are reasonable, there can be no assurance that such expectations will prove to be correct.

Forward‐looking information in this document is identified by words such as “anticipate”, “continue”, “deliver”, “focus”, “progress”, and “will” or similar expressions and includes suggestions of future outcomes, including, but not limited to, statements about: performance for the rest of 2024 and beyond; market pricing; capturing margin; achieving net debt of $4.0 billion; excess free funds flow under the shareholder returns framework; progressing growth and optimization projects; planned turnaround activities; dividend payments; advancing company-specific and Pathways Alliance emissions reductions projects; and Cenovus’s 2024 corporate guidance available on cenovus.com.

Developing forward‐looking information involves reliance on a number of assumptions and consideration of certain risks and uncertainties, some of which are specific to Cenovus and others that apply to the industry generally. The factors or assumptions on which the forward‐looking information in this news release are based include, but are not limited to: the allocation of free funds flow to reducing net debt; commodity prices, inflation and supply chain constraints; Cenovus’s ability to produce on an unconstrained basis; Cenovus’s ability to access sufficient insurance coverage to pursue development plans; Cenovus’s ability to deliver safe and reliable operations and demonstrate strong governance; and the assumptions inherent in Cenovus’s 2024 Guidance available on cenovus.com.

CENOVUS ENERGY NEWS RELEASE | 7

The risk factors and uncertainties that could cause actual results to differ materially from the forward‐looking information in this news release include, but are not limited to: the accuracy of estimates regarding commodity production and operating expenses, inflation, taxes, royalties, capital costs and currency and interest rates; risks inherent in the operation of Cenovus’s business; and risks associated with climate change and Cenovus’s assumptions relating thereto and other risks identified under “Risk Management and Risk Factors” and “Advisory” in Cenovus’s Management’s Discussion and Analysis (MD&A) for the year ended December 31, 2023.

Except as required by applicable securities laws, Cenovus disclaims any intention or obligation to publicly update or revise any forward‐looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned that the foregoing lists are not exhaustive and are made as at the date hereof. Events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, the forward‐looking information. For additional information regarding Cenovus’s material risk factors, the assumptions made, and risks and uncertainties which could cause actual results to differ from the anticipated results, refer to “Risk Management and Risk Factors” and “Advisory” in Cenovus’s MD&A for the period ended December 31, 2023, and to the risk factors, assumptions and uncertainties described in other documents Cenovus files from time to time with securities regulatory authorities in Canada (available on SEDAR+ at sedarplus.ca, on EDGAR at sec.gov and Cenovus’s website at cenovus.com).


Specified Financial Measures

This news release contains references to certain specified financial measures that do not have standardized meanings prescribed by IFRS. Readers should not consider these measures in isolation or as a substitute for analysis of the company’s results as reported under IFRS. These measures are defined differently by different companies and, therefore, might not be comparable to similar measures presented by other issuers. For information on the composition of these measures, as well as an explanation of how the company uses these measures, refer to the Specified Financial Measures Advisory located in Cenovus’s MD&A for the period ended December 31, 2023 (available on SEDAR+ at sedarplus.ca, on EDGAR at sec.gov and on Cenovus's website at cenovus.com) which is incorporated by reference into this news release.

Upstream Operating Margin and Downstream Operating Margin

Upstream Operating Margin and Downstream Operating Margin, and the individual components thereof, are included in Note 1 to the interim Consolidated Financial Statements.


CENOVUS ENERGY NEWS RELEASE | 8

Total Operating Margin

Total Operating Margin is the total of Upstream Operating Margin plus Downstream Operating Margin.
Upstream (1)
Downstream (1)
Total
($ millions)Q4 2023Q3 2023Q4 2022Q4 2023Q3 2023Q4 2022Q4 2023Q3 2023Q4 2022
Revenues
Gross Sales7,797 8,783 8,251 8,404 9,658 8,302 16,201 18,441 16,553 
Less: Royalties902 1,135 875 — — — 902 1,135 875 
6,895 7,648 7,376 8,404 9,658 8,302 15,299 17,306 15,678 
Expenses
Purchased Product663 900 1,079 7,888 7,947 6,993 8,551 8,847 8,072 
Transportation and Blending2,894 2,397 2,984 — — — 2,894 2,397 2,984 
Operating864 914 955 826 778 759 1,690 1,692 1,714 
Realized (Gain) Loss on Risk Management19 (10)134 (6)11 (8)13 1 126 
Operating Margin2,455 3,447 2,224 (304)922 558 2,151 4,369 2,782 
(1) Found in the December 31, 2023, or the September 30, 2023, interim Consolidated Financial Statements.

Upstream (1)
Downstream (1)
Total
($ millions)2023202220230202220232022
Revenues
Gross Sales31,082 41,142 32,626 38,010 63,708 79,152 
Less: Royalties3,270 4,868 — — 3,270 4,868 
27,812 36,274 32,626 38,010 60,438 74,284 
Expenses
Purchased Product3,152 6,741 28,273 32,409 31,425 39,150 
Transportation and Blending11,088 12,301 — — 11,088 12,301 
Operating3,690 3,789 3,201 3,050 6,891 6,839 
Realized (Gain) Loss on Risk Management12 1,619 — 112 12 1,731 
Operating Margin9,870 11,824 1,152 2,439 11,022 14,263 
(1) Found in the December 31, 2023, Consolidated Financial Statements.

Adjusted Funds Flow, Free Funds Flow and Excess Free Funds Flow

The following table provides a reconciliation of cash from (used in) operating activities found in Cenovus’s Consolidated Financial Statements to Adjusted Funds Flow, Free Funds Flow and Excess Free Funds Flow. Adjusted Funds Flow per Share – Basic and Adjusted Funds Flow per Share – Diluted are calculated by dividing Adjusted Funds Flow by the respective basic or diluted weighted average number of common shares outstanding during the period and may be useful to evaluate a company’s ability to generate cash.

Three Months EndedTwelve Months Ended
($ millions)Dec. 31, 2023Sept. 30, 2023Dec. 31, 2022Dec. 31, 2023Dec. 31, 2022
Cash From (Used in) Operating Activities (1)
2,946 2,738 2,970 7,388 11,403 
(Add) Deduct:
Settlement of Decommissioning Liabilities(65)(68)(49)(222)(150)
Net Change in Non-Cash Working Capital949 (641)673 (1,193)575 
Adjusted Funds Flow2,062 3,447 2,346 8,803 10,978 
Capital Investment1,170 1,025 1,274 4,298 3,708 
Free Funds Flow892 2,422 1,072 4,505 7,270 
Add (Deduct):
Base Dividends Paid on Common Shares(261)(264)(201)
CENOVUS ENERGY NEWS RELEASE | 9

Dividends Paid on Preferred Shares(9)— — 
Settlement of Decommissioning Liabilities(65)(68)(49)
Principal Repayment of Leases(72)(70)(74)
Acquisitions, Net of Cash Acquired(14)(32)(7)
Proceeds From Divestitures— 1 45 
Excess Free Funds Flow471 1,989 786 
(1) Found in the December 31, 2023, or the September 30, 2023, interim Consolidated Financial Statements.

Cenovus Energy Inc.

Cenovus Energy Inc. is an integrated energy company with oil and natural gas production operations in Canada and the Asia Pacific region, and upgrading, refining and marketing operations in Canada and the United States. The company is focused on managing its assets in a safe, innovative and cost-efficient manner, integrating environmental, social and governance considerations into its business plans. Cenovus common shares and warrants are listed on the Toronto and New York stock exchanges, and the company’s preferred shares are listed on the Toronto Stock Exchange. For more information, visit cenovus.com.

Find Cenovus on Facebook, X, LinkedIn, YouTube and Instagram.

Cenovus contacts
InvestorsMedia
Investor Relations general line
403-766-7711
Media Relations general line
403-766-7751





CENOVUS ENERGY NEWS RELEASE | 10
            
Exhibit 99.2

logoa.gif
Cenovus Energy Inc.
Interim Consolidated Financial Statements (unaudited)
For the Periods Ended December 31, 2023
(Canadian Dollars)










CONSOLIDATED FINANCIAL STATEMENTS (unaudited) logoa.gif
For the periods ended December 31, 2023

TABLE OF CONTENTS

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
2


CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) (unaudited)
For the periods ended December 31,
($ millions, except per share amounts)
Three Months Ended
Twelve Months Ended
Notes2023
2022
2023
2022
Revenues1
Gross Sales14,03614,93855,47471,765
Less: Royalties9028753,2704,868
13,13414,06352,20466,897
Expenses1
Purchased Product (1)
6,5586,92024,71533,958
Transportation and Blending (1)
2,6622,72010,14111,126
Operating (1)
1,5631,4566,3525,816
(Gain) Loss on Risk Management22(28)96611,636
Depreciation, Depletion and Amortization
6,10,11,13
1,2701,4704,6444,679
Exploration Expense932242101
(Income) Loss From Equity-Accounted Affiliates12(28)(4)(51)(15)
General and Administrative71320688865
Finance Costs4178189671820
Interest Income(33)(37)(133)(81)
Integration, Transaction and Other Costs362785106
Foreign Exchange (Gain) Loss, Net5(74)(63)(67)343
Revaluation (Gain) Loss31—34(549)
Re-measurement of Contingent Payments15(24)2059162
(Gain) Loss on Divestiture of Assets(3)(25)(14)(269)
Other (Income) Loss, Net(21)(65)(63)(532)
Earnings (Loss) Before Income Tax9741,0375,0408,731
Income Tax Expense (Recovery)72312539312,281
Net Earnings (Loss)7437844,1096,450
Net Earnings (Loss) Per Common Share ($)
8
Basic0.390.402.153.29
Diluted0.390.392.123.20
(1)Comparative periods reflect certain revisions. See Note 26.

See accompanying Notes to the interim Consolidated Financial Statements (unaudited).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
3


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (unaudited)
For the periods ended December 31,
($ millions)
Three Months EndedTwelve Months Ended
Notes2023202220232022
Net Earnings (Loss)7437844,1096,450
Other Comprehensive Income (Loss), Net of Tax19
Items That Will not be Reclassified to Profit or Loss:
Actuarial Gain (Loss) Relating to Pension and Other Post-
   Employment Benefits
(59)13(44)71
Change in the Fair Value of Equity Instruments at FVOCI (1)
2256—562
Items That may be Reclassified to Profit or Loss:
Foreign Currency Translation Adjustment(243)(183)(274)713
Total Other Comprehensive Income (Loss), Net of Tax(246)(170)(262)786
Comprehensive Income (Loss)4976143,8477,236
(1)Fair value through other comprehensive income (loss) (“FVOCI”).

See accompanying Notes to the interim Consolidated Financial Statements (unaudited).


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
4


CONSOLIDATED BALANCE SHEETS (unaudited)
As at December 31,
($ millions)
Notes20232022
Assets
Current Assets
Cash and Cash Equivalents2,2274,524
Accounts Receivable and Accrued Revenues3,0353,473
Income Tax Receivable416121
Inventories4,0304,312
Total Current Assets9,70812,430
Restricted Cash16211209
Exploration and Evaluation Assets, Net
1,9
738685
Property, Plant and Equipment, Net
1,10
37,25036,499
Right-of-Use Assets, Net
1,11
1,6801,845
Income Tax Receivable2525
Investments in Equity-Accounted Affiliates12366365
Other Assets13318342
Deferred Income Taxes696546
Goodwill
1
2,9232,923
Total Assets53,91555,869
Liabilities and Equity
Current Liabilities
Accounts Payable and Accrued Liabilities5,4806,124
Income Tax Payable881,211
Short-Term Borrowings14179115
Lease Liabilities11299308
Contingent Payments15164263
Total Current Liabilities6,2108,021
Long-Term Debt147,1088,691
Lease Liabilities112,3592,528
Contingent Payments15—156
Decommissioning Liabilities164,1553,559
Other Liabilities171,1831,042
Deferred Income Taxes4,1884,283
Total Liabilities25,20328,280
Shareholders’ Equity28,69827,576
Non-Controlling Interest1413
Total Liabilities and Equity53,91555,869
Commitments and Contingencies25
See accompanying Notes to the interim Consolidated Financial Statements (unaudited).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
5


CONSOLIDATED STATEMENTS OF EQUITY (unaudited)
($ millions)
Shareholders’ Equity
Common SharesPreferred SharesWarrants
Paid in
Surplus
Retained
Earnings
AOCI (1)
TotalNon-Controlling Interest
(Note 18)
(Note 18)
(Note 18)
(Note 19)
As at December 31, 2021
17,0165192154,28487868423,59612
Net Earnings (Loss)————6,450—6,450—
Other Comprehensive Income
  (Loss), Net of Tax
—————786786—
Total Comprehensive Income (Loss)————6,4507867,236—
Common Shares Issued Under
   Stock Option Plans
170——(32)——138—
Purchase of Common Shares Under
   NCIB (2)
(959)——(1,571)——(2,530)—
Warrants Exercised93—(31)———62—
Stock-Based Compensation
   Expense
———10——10—
Base Dividends on Common Shares————(682)—(682)—
Variable Dividends on Common
   Shares
————(219)—(219)—
Dividends on Preferred Shares————(35)—(35)—
Non-Controlling Interest———————1
As at December 31, 2022
16,3205191842,6916,3921,47027,57613
Net Earnings (Loss)————4,109—4,109—
Other Comprehensive Income
   (Loss), Net of Tax
—————(262)(262)—
Total Comprehensive Income (Loss)————4,109(262)3,847—
Common Shares Issued Under
   Stock Option Plans
58——(12)——46—
Purchase of Common Shares Under
   NCIB (2)
(373)——(688)——(1,061)—
Warrants Exercised26—(8)———18—
Warrants Purchased and Cancelled——(151)—(562)—(713)—
Stock-Based Compensation
   Expense
———11——11—
Base Dividends on Common Shares————(990)—(990)—
Dividends on Preferred Shares————(36)—(36)—
Non-Controlling Interest———————1
As at December 31, 2023
16,031519252,0028,9131,20828,69814
(1)Accumulated other comprehensive income (loss) (“AOCI”).
(2)Normal course issuer bid (“NCIB”).

See accompanying Notes to the interim Consolidated Financial Statements (unaudited).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
6


CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
For the periods ended December 31,
($ millions)
Three Months Ended
Twelve Months Ended
Notes2023202220232022
Operating Activities
Net Earnings (Loss)7437844,1096,450
Depreciation, Depletion and Amortization
6,10,11,13
1,2701,4704,6444,679
Deferred Income Tax Expense (Recovery)716617(250)642
Unrealized (Gain) Loss on Risk Management22(36)(38)52(126)
Unrealized Foreign Exchange (Gain) Loss5(111)(54)(210)365
Realized Foreign Exchange (Gain) Loss on Non-Operating
   Items		——98146
Revaluation (Gain) Loss31—34(549)
Re-measurement of Contingent Payments(24)2059(469)
(Gain) Loss on Divestiture of Assets(3)(25)(14)(269)
Unwinding of Discount on Decommissioning Liabilities165544220176
(Income) Loss From Equity-Accounted Affiliates12(28)(4)(51)(15)
Distributions Received From Equity-Accounted Affiliates12321114965
Other(3)121(37)(117)
Settlement of Decommissioning Liabilities16(65)(49)(222)(150)
Net Change in Non-Cash Working Capital24949673(1,193)575
Cash From (Used in) Operating Activities2,9462,9707,38811,403
Investing Activities
Acquisitions, Net of Cash Acquired3(14)(7)(515)(397)
Capital Investment 1(1,170)(1,274)(4,298)(3,708)
Proceeds From Divestitures—45121,514
Payment on Divestiture of Assets———(50)
Net Change in Investments and Other(24)(26)(125)(211)
Net Change in Non-Cash Working Capital24(72)92(369)538
Cash From (Used in) Investing Activities(1,280)(1,170)(5,295)(2,314)
Net Cash Provided (Used) Before Financing Activities1,6661,8002,0939,089
Financing Activities24
Net Issuance (Repayment) of Short-Term Borrowings1591155834
Repayment of Long-Term Debt
14
——(1,346)(4,149)
Principal Repayment of Leases11(72)(74)(288)(302)
Common Shares Issued Under Stock Option Plans3546138
Purchase of Common Shares Under NCIB18(350)(387)(1,061)(2,530)
Payment for Purchase of Warrants18(111)—(711)—
Proceeds From Exercise of Warrants2111862
Base Dividends Paid on Common Shares8(261)(201)(990)(682)
Variable Dividends Paid on Common Shares8—(219)—(219)
Dividends Paid on Preferred Shares8(9)—(36)(26)
Other——(3)(2)
Cash From (Used in) Financing Activities(639)(750)(4,313)(7,676)
Effect of Foreign Exchange on Cash and Cash Equivalents
(62)(20)(77)238
Increase (Decrease) in Cash and Cash Equivalents9651,030(2,297)1,651
Cash and Cash Equivalents, Beginning of Period1,2623,4944,5242,873
Cash and Cash Equivalents, End of Period2,2274,5242,2274,524
See accompanying Notes to the interim Consolidated Financial Statements (unaudited).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
7

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
1. DESCRIPTION OF BUSINESS AND SEGMENTED DISCLOSURES
Cenovus Energy Inc. (“Cenovus” or the “Company”) is an integrated energy company with crude oil and natural gas production operations in Canada and the Asia Pacific region, and upgrading, refining and marketing operations in Canada and the United States (“U.S.”).
Cenovus is incorporated under the Canada Business Corporations Act and its common shares and common share purchase warrants are listed on the Toronto Stock Exchange (“TSX”) and the New York Stock Exchange. Cenovus’s cumulative redeemable preferred shares series 1, 2, 3, 5 and 7 are listed on the TSX. The executive and registered office is located at 4100, 225 6 Avenue S.W., Calgary, Alberta, Canada, T2P 1N2. Information on the Company’s basis of preparation for these interim Consolidated Financial Statements is found in Note 2.
Management has determined the operating segments based on information regularly reviewed for the purposes of decision making, allocating resources and assessing operational performance by Cenovus’s chief operating decision maker. The Company’s operating segments are aggregated based on their geographic locations, the nature of the businesses or a combination of these factors. The Company evaluates the financial performance of its operating segments primarily based on operating margin.
The Company operates through the following reportable segments:
Upstream Segments
•Oil Sands, includes the development and production of bitumen and heavy oil in northern Alberta and Saskatchewan. Cenovus’s oil sands assets include Foster Creek, Christina Lake, Sunrise, Lloydminster thermal and Lloydminster conventional heavy oil assets. Cenovus jointly owns and operates pipeline gathering systems and terminals through the equity-accounted investment in Husky Midstream Limited Partnership (“HMLP”). The sale and transportation of Cenovus’s production and third-party commodity trading volumes are managed and marketed through access to capacity on third-party pipelines and storage facilities in both Canada and the U.S. to optimize product mix, delivery points, transportation commitments and customer diversification.
•Conventional, includes assets rich in natural gas liquids (“NGLs”) and natural gas within the Elmworth-Wapiti, Kaybob‑Edson, Clearwater and Rainbow Lake operating areas in Alberta and British Columbia and interests in numerous natural gas processing facilities. Cenovus’s NGLs and natural gas production is marketed and transported, with additional third-party commodity trading volumes, through access to capacity on third-party pipelines, export terminals and storage facilities. These provide flexibility for market access to optimize product mix, delivery points, transportation commitments and customer diversification.
•Offshore, includes offshore operations, exploration and development activities in China and the east coast of Canada, as well as the equity-accounted investment in Husky-CNOOC Madura Ltd. (“HCML”), which is engaged in the exploration for and production of NGLs and natural gas in offshore Indonesia.
Downstream Segments
•Canadian Refining, includes the owned and operated Lloydminster upgrading and asphalt refining complex, which converts heavy oil and bitumen into synthetic crude oil, diesel, asphalt and other ancillary products. Cenovus also owns and operates the Bruderheim crude-by-rail terminal and two ethanol plants. The Company’s commercial fuels business across Canada is included in this segment. Cenovus markets its production and third-party commodity trading volumes in an effort to use its integrated network of assets to maximize value. The Company renamed its Canadian Manufacturing segment to Canadian Refining in 2023.
•U.S. Refining, includes the refining of crude oil to produce gasoline, diesel, jet fuel, asphalt and other products at the wholly-owned Lima, Superior and Toledo refineries, and the jointly-owned Wood River and Borger refineries (jointly owned with operator Phillips 66). Cenovus markets some of its own and third-party refined products including gasoline, diesel, jet fuel and asphalt. The Company renamed its U.S. Manufacturing segment to U.S. Refining in 2023.
Corporate and Eliminations
Corporate and Eliminations, includes Cenovus-wide costs for general and administrative, financing activities, gains and losses on risk management for corporate related derivative instruments and foreign exchange. Eliminations include adjustments for feedstock and internal usage of crude oil, natural gas, condensate, other NGLs and refined products between segments; transloading services provided to the Oil Sands segment by the Company’s crude-by-rail terminal; the sale of condensate extracted from blended crude oil production in the Canadian Refining segment and sold to the Oil Sands segment; and unrealized profits in inventory. Eliminations are recorded based on market prices.




Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
8

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
A) Results of Operations – Segment and Operational Information
i) Results for the Three Months Ended December 31
Upstream
For the three months ended
Oil Sands
Conventional
OffshoreTotal
December 31,20232022202320222023202220232022
Revenues
Gross Sales (1)
6,4776,6538061,1535144457,7978,251
Less: Royalties
84178427703421902875
5,6365,8697791,0834804246,8957,376
Expenses
Purchased Product (1)
226516437563——6631,079
Transportation and Blending (1)
2,8092,9227859732,8942,984
Operating
61573314613810384864955
Realized (Gain) Loss on Risk
   Management		2459(5)75——19134
Operating Margin1,9621,6391232483703372,4552,224
Unrealized (Gain) Loss on Risk
   Management
(29)(9)(5)6——(34)(3)
Depreciation, Depletion and
   Amortization		763786100881381441,0011,018
Exploration Expense1526—11—322
(Income) Loss From Equity-
   Accounted Affiliates		————(28)(4)(28)(4)
Segment Income (Loss)1,213860221542491971,4841,211
Downstream
Canadian Refining
U.S. Refining
Total
For the three months ended December 31,
2023
2022
2023202220232022
Revenues
Gross Sales (1)
1,5571,7726,8476,5308,4048,302
Less: Royalties
——————
1,5571,7726,8476,5308,4048,302
Expenses
Purchased Product (1)
1,2631,3246,6255,6697,8886,993
Transportation and Blending
——————
Operating
168170658589826759
Realized (Gain) Loss on Risk Management——(6)(8)(6)(8)
Operating Margin126278(430)280(304)558
Unrealized (Gain) Loss on Risk Management
——(4)40(4)40
Depreciation, Depletion and Amortization4944172381221425
Exploration Expense——————
(Income) Loss From Equity-Accounted Affiliates——————
Segment Income (Loss)77234(598)(141)(521)93
(1)Comparative periods reflect certain revisions. See Note 26.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
9

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Corporate and EliminationsConsolidated
For the three months ended December 31,
2023202220232022
Revenues
Gross Sales (1)
(2,165)(1,615)14,03614,938
Less: Royalties
——902875
(2,165)(1,615)13,13414,063
Expenses
Purchased Product (1)
(1,993)(1,152)6,5586,920
Transportation and Blending (1)
(232)(264)2,6622,720
Operating (1)
(127)(258)1,5631,456
Realized (Gain) Loss on Risk Management(5)88134
Unrealized (Gain) Loss on Risk Management
2(75)(36)(38)
Depreciation, Depletion and Amortization48271,2701,470
Exploration Expense——322
(Income) Loss From Equity-Accounted Affiliates——(28)(4)
Segment Income (Loss)142991,1051,403
General and Administrative7132071320
Finance Costs178189178189
Interest Income(33)(37)(33)(37)
Integration, Transaction and Other Costs36273627
Foreign Exchange (Gain) Loss, Net(74)(63)(74)(63)
Revaluation (Gain) Loss1—1—
Re-measurement of Contingent Payments(24)20(24)20
(Gain) Loss on Divestiture of Assets(3)(25)(3)(25)
Other (Income) Loss, Net(21)(65)(21)(65)
131366131366
Earnings (Loss) Before Income Tax9741,037
Income Tax Expense (Recovery)231253
Net Earnings (Loss)743784
(1)Comparative periods reflect certain revisions. See Note 26.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
10

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
ii) Results for the Twelve Months Ended December 31
Upstream
For the twelve months ended
Oil SandsConventionalOffshoreTotal
December 31,
20232022202320222023202220232022
Revenues
Gross Sales (1)
26,19234,6833,2734,4391,6172,02031,08241,142
Less: Royalties
3,0594,49311229899773,2704,868
23,13330,1903,1614,1411,5181,94327,81236,274
Expenses
Purchased Product (1)
1,4574,7181,6952,023——3,1526,741
Transportation and Blending (1)
10,77412,036298250161511,08812,301
Operating
2,7162,9305905413843183,6903,789
Realized (Gain) Loss on Risk
   Management		171,527(5)92——121,619
Operating Margin8,1698,9795831,2351,1181,6109,87011,824
Unrealized (Gain) Loss on Risk
   Management
15(68)(19)13——(4)(55)
Depreciation, Depletion and
   Amortization		2,9932,7633863704875853,8663,718
Exploration Expense19961179142101
(Income) Loss From Equity-
   Accounted Affiliates		68——(57)(23)(51)(15)
Segment Income (Loss)5,1366,2672108516719576,0178,075
Downstream
Canadian Refining
U.S. Refining
Total
For the twelve months ended December 31,
2023
2022
2023202220232022
Revenues
Gross Sales (1)
6,2337,79226,39330,21832,62638,010
Less: Royalties
——————
6,2337,79226,39330,21832,62638,010
Expenses
Purchased Product (1)
4,9196,38923,35426,02028,27332,409
Transportation and Blending
——————
Operating
6397042,5622,3463,2013,050
Realized (Gain) Loss on Risk Management———112—112
Operating Margin6756994771,7401,1522,439
Unrealized (Gain) Loss on Risk Management
——(17)18(17)18
Depreciation, Depletion and Amortization185208486640671848
Exploration Expense——————
(Income) Loss From Equity-Accounted Affiliates——————
Segment Income (Loss)49049181,0824981,573
(1)Comparative periods reflect certain revisions. See Note 26.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
11

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Corporate and EliminationsConsolidated
For the twelve months ended December 31,
2023202220232022
Revenues
Gross Sales (1)
(8,234)(7,387)55,47471,765
Less: Royalties
——3,2704,868
(8,234)(7,387)52,20466,897
Expenses
Purchased Product (1)
(6,710)(5,192)24,71533,958
Transportation and Blending (1)
(947)(1,175)10,14111,126
Operating (1)
(539)(1,023)6,3525,816
Realized (Gain) Loss on Risk Management(3)3191,762
Unrealized (Gain) Loss on Risk Management
73(89)52(126)
Depreciation, Depletion and Amortization1071134,6444,679
Exploration Expense——42101
(Income) Loss From Equity-Accounted Affiliates——(51)(15)
Segment Income (Loss)(215)(52)6,3009,596
General and Administrative688865688865
Finance Costs671820671820
Interest Income(133)(81)(133)(81)
Integration, Transaction and Other Costs8510685106
Foreign Exchange (Gain) Loss, Net(67)343(67)343
Revaluation (Gain) Loss34(549)34(549)
Re-measurement of Contingent Payments5916259162
(Gain) Loss on Divestiture of Assets(14)(269)(14)(269)
Other (Income) Loss, Net(63)(532)(63)(532)
1,2608651,260865
Earnings (Loss) Before Income Tax5,0408,731
Income Tax Expense (Recovery)9312,281
Net Earnings (Loss)4,1096,450
(1)Comparative periods reflect certain revisions. See Note 26.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
12

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
B) Revenues by Product
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Upstream
Oil Sands
Crude Oil (1)
5,5105,62222,55028,921
NGLs (2)
55169352877
Natural Gas and Other
7178231392
Conventional
Crude Oil 17981589429
NGLs (2)
208220799926
Natural Gas and Other (1)
3927821,7732,786
Offshore
Crude Oil16485385581
NGLs8084280354
Natural Gas2362558531,008
Total Upstream6,8957,37627,81236,274
Downstream
Canadian Refining
Synthetic Crude Oil5175742,1242,360
Diesel4666201,7522,164
Asphalt140138571620
Gasoline112111522948
Other Products and Services3223291,2641,700
U.S. Refining
Gasoline3,0392,93612,37514,116
Distillates2,4432,9189,61211,453
Asphalt
254131864533
Other Products (1)
1,1115453,5424,116
Total Downstream8,4048,30232,62638,010
Corporate and Eliminations (1)
(2,165)(1,615)(8,234)(7,387)
Consolidated13,13414,06352,20466,897
(1)Comparative periods reflect certain revisions. See Note 26.
(2)Third-party condensate sales are included within NGLs.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
13

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
C) Geographical Information
Revenues (1)
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Canada (2)
6,3006,84325,12833,314
United States (2)
6,5186,88125,94332,221
China3163391,1331,362
Consolidated13,13414,06352,20466,897
(1)Revenues by country are classified based on where the operations are located.
(2)Comparative periods reflect certain revisions. See Note 26.
Non-Current Assets (1)
As at December 31,
2023
2022
Canada35,87635,194
United States5,2304,824
China1,6082,064
Indonesia344365
Consolidated43,05842,447
(1)Includes exploration and evaluation (“E&E”) assets, property, plant and equipment (“PP&E”), right-of-use (“ROU”) assets, income tax receivable, investments in equity-accounted affiliates, precious metals, intangible assets and goodwill.
D) Assets by Segment
E&E AssetsPP&EROU Assets
As at December 31,
202320222023202220232022
Oil Sands72967424,44324,657849638
Conventional—62,2092,02012
Offshore952,7982,549102152
Canadian Refining——2,4692,46628252
U.S. Refining——5,0144,482268329
Corporate and Eliminations——317325432472
Consolidated73868537,25036,4991,6801,845
GoodwillTotal Assets
As at December 31,
2023202220232022
Oil Sands2,9232,92331,67332,248
Conventional ——2,4292,410
Offshore——3,5113,339
Canadian Refining——2,9603,172
U.S. Refining——8,6608,324
Corporate and Eliminations
——4,6826,376
Consolidated2,9232,92353,91555,869

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
14

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
E) Capital Expenditures (1)
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Capital Investment
Oil Sands6186812,3821,792
Conventional129156452344
Offshore
Asia Pacific3378
Atlantic16182635302
Total Upstream9119223,4762,446
Canadian Refining
4640145117
U.S. Refining
1672856021,059
Total Downstream2133257471,176
Corporate and Eliminations46277586
1,1701,2744,2983,708
Acquisitions (Note 3)
Oil Sands
2—371,609
Conventional—6512
U.S. Refining (2)
——385—
264271,621
Total Capital Expenditures1,1721,2804,7255,329
(1)Includes expenditures on PP&E, E&E assets and capitalized interest.
(2)In 2023, Cenovus was deemed to have disposed of its pre-existing interest in BP-Husky Refining LLC (“Toledo”) and reacquired it at fair value as required by International Financial Reporting Standard 3, “Business Combinations” (“IFRS 3”). The acquisition capital above does not include the fair value of the pre‑existing interest in Toledo of $368 million.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
15

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
2. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE
In these interim Consolidated Financial Statements, unless otherwise indicated, all dollars are expressed in Canadian dollars. All references to C$ or $ are to Canadian dollars and references to US$ are to U.S. dollars.
These interim Consolidated Financial Statements were prepared in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board (“IASB”) applicable to the preparation of interim financial statements, including International Accounting Standard 34, “Interim Financial Reporting”, and were prepared following the same accounting policies and methods of computation as the annual Consolidated Financial Statements for the year ended December 31, 2022.
Certain information and disclosures normally included in the notes to the annual Consolidated Financial Statements were condensed or disclosed on an annual basis only. Accordingly, these interim Consolidated Financial Statements should be read in conjunction with the annual Consolidated Financial Statements for the year ended December 31, 2022, which were prepared in accordance with IFRS Accounting Standards as issued by the IASB.
These interim Consolidated Financial Statements were approved by the Board of Directors effective February 14, 2024.
3. ACQUISITIONS
A) BP-Husky Refining LLC
i) Summary of the Acquisition
On February 28, 2023, Cenovus acquired the remaining 50 percent interest in Toledo from BP Products North America Inc. (“bp”), previously a joint operation (the “Toledo Acquisition”). It provided Cenovus full ownership and operatorship of the refinery, and further integrating Cenovus’s heavy oil production and refining capabilities. Total consideration for the Toledo Acquisition was US$378 million (C$514 million) in cash, including working capital.
The Toledo Acquisition was accounted for using the acquisition method pursuant to IFRS 3. Under the acquisition method, assets and liabilities are recorded at fair value on the date of acquisition and the total consideration is allocated to the assets acquired and liabilities assumed. The excess of consideration given over the fair value of the net assets acquired, if any, is recorded as goodwill.
ii) Identifiable Assets Acquired and Liabilities Assumed
The final purchase price allocation was based on Management’s best estimate of fair value and was retrospectively adjusted to reflect items identified with new information obtained between February 28, 2023, and December 31, 2023, about conditions that existed at the acquisition date. Changes to identifiable assets acquired and liabilities assumed includes increases to PP&E of $96 million, partially offset by decreases of $66 million to inventories, $3 million to other liabilities and $1 million to accounts payable and accrued liabilities. The impact to depreciation, depletion and amortization (“DD&A”) as a result of these measurement period adjustments was not material and prior quarters have not been restated to reflect the impact of the measurement period adjustments.
The following table summarizes the recognized amounts of assets acquired and liabilities assumed at the date of acquisition.
As atFebruary 28, 2023
100 Percent of the Identifiable Assets Acquired and Liabilities Assumed
Cash69
Accounts Receivable and Accrued Revenues3
Inventories387
Property, Plant and Equipment 770
Right-of-Use Assets33
Other Assets10
Accounts Payable and Accrued Liabilities(139)
Lease Liabilities(33)
Decommissioning Liabilities (5)
Other Liabilities(73)
Total Identifiable Net Assets1,022
The fair value and gross contractual amount of acquired accounts receivable and accrued revenues was $3 million, all of which was collected.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
16

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
iii) Goodwill
As atFebruary 28, 2023
Total Purchase Consideration514
Fair Value of Pre-Existing 50 Percent Ownership Interest in Toledo
508
Fair Value of Identifiable Net Assets(1,022)
Goodwill—
Fair Value of Pre-Existing 50 Percent Ownership Interest in BP-Husky Refining LLC
Prior to the Toledo Acquisition, Toledo was jointly controlled with bp and met the definition of a joint operation under IFRS 11, “Joint Arrangements”. Subsequent to the Toledo Acquisition, Cenovus controls Toledo, as defined under IFRS 10, “Consolidated Financial Statements”, and, accordingly Toledo was consolidated. As required by IFRS 3, when an acquirer achieves control in stages, the previously held interest is re-measured to fair value at the acquisition date with any gain or loss recognized in net earnings (loss).
The acquisition-date fair value of the previously held interest was estimated to be $508 million and the net carrying value of Toledo assets was $554 million. Cenovus recognized a non-cash revaluation loss of $34 million ($23 million, after tax) on the re-measurement of its pre-existing interest in Toledo to fair value, net of $12 million in associated cumulative foreign currency translation adjustments.
iv) Transaction Costs
For the three and twelve months ended December 31, 2023, transaction costs of $nil and $11 million, respectively, (three and twelve months ended December 31, 2022 – $7 million and $9 million, respectively), were recognized in the Consolidated Statements of Earnings (Loss).
v) Revenue and Profit Contribution
The acquired business contributed revenues of $4.1 billion and a net loss of $85 million for the period from February 28, 2023, to December 31, 2023. On September 20, 2022, an incident occurred at the Toledo Refinery, resulting in the shutdown of the facility. The Toledo Refinery returned to full operations in June 2023. If the closing of the Toledo Acquisition had occurred on January 1, 2023, Cenovus’s consolidated pro forma revenues and net earnings for the year ended December 31, 2023, would be $52.2 billion and $4.0 billion, respectively. These amounts were calculated using results from the acquired business, adjusting them for:
•Additional DD&A that would be charged assuming the fair value adjustments to PP&E had applied from January 1, 2023.
•Additional accretion on the decommissioning liabilities if they had been assumed on January 1, 2023.
•The consequential tax effects.
This pro forma information is not necessarily indicative of the results that would be obtained if the Toledo Acquisition had actually occurred on January 1, 2023.
B) Sunrise Oil Sands Partnership
On August 31, 2022, Cenovus closed a transaction with BP Canada Energy Group ULC (“bp Canada”) to purchase the remaining 50 percent interest in Sunrise Oil Sands Partnership (“SOSP”), in northern Alberta (the “Sunrise Acquisition”). It provided Cenovus with full ownership and further enhanced Cenovus’s core strength in the oil sands.
The final purchase price allocation was based on Management’s best estimate of the assets acquired and liabilities assumed. No additional adjustments were made to the purchase price allocation in the period. For more details, see Note 5 of the annual Consolidated Financial Statements for the year ended December 31, 2022.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
4. FINANCE COSTS
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Interest Expense – Short-Term Borrowings and Long-Term Debt7797362478
Net Premium (Discount) on Redemption of Long-Term Debt (1)
——(84)(29)
Interest Expense – Lease Liabilities (Note 11)
4040161163
Unwinding of Discount on Decommissioning Liabilities (Note 16)
5544220176
Other14103237
186191691825
Capitalized Interest(8)(2)(20)(5)
178189671820
(1)Includes the premium or discount on redemption, net of transaction costs and the amortization of associated fair value adjustments.
5. FOREIGN EXCHANGE (GAIN) LOSS, NET
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Unrealized Foreign Exchange (Gain) Loss on Translation of:
U.S. Dollar Debt Issued From Canada(112)(79)(231)365
Other12521—
Unrealized Foreign Exchange (Gain) Loss(111)(54)(210)365
Realized Foreign Exchange (Gain) Loss37(9)143(22)
(74)(63)(67)343
6. IMPAIRMENT CHARGES AND REVERSALS
At each reporting date, the Company assesses its cash-generating units (“CGUs”) for indicators of impairment or when facts and circumstances suggest that the carrying amount may exceed the recoverable amount. Impairment losses recognized in prior periods, other than goodwill impairments, are assessed at each reporting date for any indicators that the impairment losses may no longer exist or may have decreased. Goodwill is tested for impairment at least annually. For the purposes of impairment testing, goodwill is allocated to the CGU to which it relates.
A) Upstream Cash-Generating Units
i) 2023 Impairment Charges
The Company tested CGUs with associated goodwill for impairment as at December 31, 2023, and there were no impairments. No impairment indicators were identified for the remaining CGUs.
Key Assumptions
The recoverable amounts (Level 3) of Cenovus’s Oil Sands CGUs with associated goodwill that were tested for impairment were estimated using fair value less costs of disposal (“FVLCOD”). Key assumptions used to estimate the present value of future net cash flows from reserves include expected production volumes, quantity of reserves, forward commodity prices, future development and operating expenses, all consistent with Cenovus’s independent qualified reserve evaluators (“IQREs”), and discount rates. Fair values for producing properties were calculated based on discounted after-tax cash flows of proved and probable reserves using forward prices and cost estimates as at December 31, 2023. All reserves were evaluated as at December 31, 2023, by the Company’s IQREs.


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Crude Oil, NGLs and Natural Gas Prices
The forward commodity prices as at December 31, 2023, used to determine future cash flows from crude oil, NGLs and natural gas reserves were:
20242025202620272028Average Annual Increase Thereafter
West Texas Intermediate (“WTI”) (US$/bbl) (1)
73.6774.9876.1477.6679.222.00 %
Western Canadian Select at Hardisty (2) (C$/bbl)
76.7479.7781.1282.8885.042.00 %
Condensate at Edmonton (C$/bbl)
96.7998.75100.71102.72104.782.00 %
Alberta Energy Company Natural Gas (C$/Mcf) (3)
2.203.374.054.134.212.00 %
(1)Barrel ("bbl").
(2)Western Canadian Select at Hardisty (“WCS”).
(3)One thousand cubic feet (“Mcf”).
Discount Rates
Discounted future cash flows were determined by applying a discount rate of 14 percent.
Sensitivities
A one percent increase in the discount rate or a five percent decrease in forward commodity price estimates would not impact the results of the impairment tests performed on CGUs with associated goodwill.
ii) 2022 Impairment Charges and Reversals
The Company tested the CGUs with associated goodwill for impairment as at December 31, 2022, and there were no impairments. The Company also tested the Sunrise CGU for impairment due to a decline in near-term forward prices between the date of the Sunrise Acquisition and December 31, 2022. The recoverable amount of the Sunrise CGU was in excess of its carrying amount and no impairment was recorded. 
B) Downstream Cash-Generating Units
i) 2023 Impairment Charges and Reversals
As at December 31, 2023, there were no indicators of impairment or impairment reversals for the Company's downstream CGUs.
ii) 2022 Impairment Charges and Reversals
As at December 31, 2022, the Company identified indicators of impairment for the Toledo CGU due to the pending acquisition of the remaining 50 percent from bp and an incident at the Toledo Refinery, and for the Superior CGU with the commissioning of the asset in preparation for restart. The total carrying amount of the Toledo and Superior CGUs was greater than the recoverable amount. An impairment charge of $1.5 billion was recorded as additional DD&A in the U.S. Refining segment.
As at December 31, 2022, there were also indicators of impairment reversals for the Company’s Borger, Wood River and Lima CGUs due to an increase in forward crack spreads, resulting in higher margins for refined products. An assessment indicated the recoverable amount was greater than the carrying value of the associated CGUs. As at December 31, 2022, the Company reversed impairment charges of $1.2 billion, net of DD&A that would have been recorded had no impairment been recorded.
As at December 31, 2022, the aggregate recoverable amount of the U.S. Refining CGUs was estimated to be $5.4 billion.
Key Assumptions
The recoverable amount (Level 3) of the U.S. Refining CGUs were determined using FVLCOD. FVLCOD was calculated based on discounted after-tax cash flows using forward prices and cost estimates. Key assumptions in the determination of future cash flows included throughput, forward crude oil prices, forward crack spreads, future capital expenditures, future operating costs and discount rates. Forward crack spreads are based on an average of third-party consultant forecasts.


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Crude Oil and Crack Spreads
Forward prices are based on Management’s best estimate and corroborated with third-party data. As at December 31, 2022, the forward prices used to determine future cash flows were:
(US$/barrel)20232024202520262027
WTI80.3378.5076.9577.6179.16
Differential WTI – WTS (1)
(0.56)(0.56)(0.56)(0.56)(0.56)
Differential WTI – WCS(23.32)(19.09)(17.42)(15.87)(15.74)
Chicago 3-2-1 Crack Spread29.3724.1022.1221.7021.67
(1)West Texas Sour (“WTS”).
Subsequent prices were extrapolated using a two percent growth rate to determine future cash flows up to the year 2032.
Discount Rates
Discounted future cash flows were determined by applying a discount rate between 15 percent and 18 percent based on the individual characteristics of the CGU, and other economic and operating factors.
7. INCOME TAXES
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Current Tax
Canada1001281,0411,252
United States(113)8(109)104
Asia Pacific7289224262
Other International6112521
Total Current Tax Expense (Recovery)652361,1811,639
Deferred Tax Expense (Recovery)16617(250)642
2312539312,281
For the year ended December 31, 2023, Cenovus reported a deferred tax recovery of $250 million of which $115 million related to a step-up in the U.S. tax basis on the Toledo Acquisition.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
20

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
8. PER SHARE AMOUNTS
A) Net Earnings (Loss) Per Common Share – Basic and Diluted
Three Months Ended
Twelve Months Ended
For the periods ended December 31,
2023202220232022
Net Earnings (Loss)7437844,1096,450
Effect of Cumulative Dividends on Preferred Shares(9)(9)(36)(35)
Net Earnings (Loss) – Basic and Diluted7347754,0736,415
Basic – Weighted Average Number of Shares (thousands)
1,879,2701,916,9851,895,4871,951,262
Dilutive Effect of Warrants5,83742,77822,22344,845
Dilutive Effect of Net Settlement Rights5,3407,3597,15010,045
Dilutive Effect of Cenovus Replacement Stock Options583—580—
Diluted – Weighted Average Number of Shares (thousands)
1,891,0301,967,1221,925,4402,006,152
Net Earnings (Loss) Per Common Share – Basic ($)
0.390.402.153.29
Net Earnings (Loss) Per Common Share – Diluted (1) (2) ($)
0.390.392.123.20
(1)For the three and twelve months ended December 31, 2023, net earnings of $nil (three and twelve months ended December 31, 2022 – $16 million and $52 million, respectively), and no common shares (three and twelve months ended December 31, 2022 – 1.7 million and 1.6 million, respectively), related to the assumed exercise of the Cenovus replacement stock options were excluded from the calculation of dilutive net earnings (loss) per share as the effect was anti-dilutive.
(2)For the three and twelve months ended December 31, 2023, net settlement rights (“NSRs”) of 1.4 million and 1.5 million, respectively, (three and twelve months ended December 31, 2022 – 52 thousand) were excluded from the calculation of diluted weighted average number of shares as the effect was anti-dilutive.
B) Common Share Dividends
20232022
For the twelve months ended December 31,
Per ShareAmountPer ShareAmount
Base Dividends 0.5259900.350682
Variable Dividends ——0.114219
Total Common Share Dividends Declared and Paid0.5259900.464901
The declaration of common share dividends is at the sole discretion of the Company’s Board of Directors and is considered quarterly.
On February 14, 2024, the Company’s Board of Directors declared a first quarter base dividend of $0.140 per common share, payable on March 28, 2024, to common shareholders of record as at March 15, 2024.    
C) Preferred Share Dividends
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Series 1 First Preferred Shares2277
Series 2 First Preferred Shares——21
Series 3 First Preferred Shares331212
Series 5 First Preferred Shares2299
Series 7 First Preferred Shares2266
Total Preferred Share Dividends Declared993635
The declaration of preferred share dividends is at the sole discretion of the Company’s Board of Directors and is considered quarterly.
For the three and twelve months ended December 31, 2023, the Company paid $9 million and $36 million, respectively, in preferred share dividends (three and twelve months ended December 31, 2022 – $nil and $26 million, respectively).


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
21

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
On January 2, 2024, the Company paid preferred share dividends of $9 million, as declared on November 1, 2023. On January 3, 2023, the Company paid preferred share dividends of $9 million, as declared on November 1, 2022.
On February 14, 2024, the Company’s Board of Directors declared first quarter dividends of $9 million payable on April 1, 2024, to preferred shareholders of record as at March 15, 2024.
9. EXPLORATION AND EVALUATION ASSETS, NET
Total
As at December 31, 2022
685
Acquisition31
Additions84
Transfer to PP&E (Note 10)
(60)
Write-downs (1)
(29)
Change in Decommissioning Liabilities28
Exchange Rate Movements and Other
(1)
As at December 31, 2023
738
(1)For the twelve months ended December 31, 2023, previously capitalized E&E costs of $14 million, $6 million and $9 million in the Oil Sands, Conventional and Offshore segments, respectively, were written off as exploration expense (2022 – $2 million and $62 million in the Oil Sands and Offshore segments, respectively), as the carrying value was not considered to be recoverable.
10. PROPERTY, PLANT AND EQUIPMENT, NET
Crude Oil and Natural Gas PropertiesProcessing, Transportation and Storage Assets
Refining Assets
Other Assets (1)
Total
COST
As at December 31, 2022
43,52825412,1321,82557,739
Acquisitions (Note 3) (2)
11—770—781
Additions 3,39214719894,214
Transfer from E&E (Note 9)
60———60
Change in Decommissioning Liabilities542—2118581
Divestitures (Note 3) (2)
(17)—(633)(17)(667)
Exchange Rate Movements and Other(91)4(239)(7)(333)
As at December 31, 2023
47,42527212,7701,90862,375
ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION
As at December 31, 2022
14,3021065,5471,28521,240
Depreciation, Depletion and Amortization (3)
3,69219554864,351
Divestitures (Note 3) (2)
(8)—(299)(12)(319)
Exchange Rate Movements and Other(11)4(135)(5)(147)
As at December 31, 2023
17,9751295,6671,35425,125
CARRYING VALUE
As at December 31, 2022
29,2261486,58554036,499
As at December 31, 2023
29,4501437,10355437,250
(1)Includes assets within the commercial fuels business, office furniture, fixtures, leasehold improvements, information technology and aircraft.
(2)In connection with the Toledo Acquisition, Cenovus was deemed to have disposed of its pre-existing interest and reacquired it at fair value as required by IFRS 3. As at February 28, 2023, the carrying value of the pre-existing interest in Toledo’s PP&E was $334 million.
(3)For the twelve months ended December 31, 2023, DD&A includes asset write-downs of $20 million, $12 million and $38 million in the Oil Sands, Canadian Refining and U.S. Refining segments, respectively, (2022 – $26 million and $25 million in the Offshore and Canadian Refining segments, respectively).


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
22

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
11. LEASES
A) Right-of-Use Assets, Net
Real Estate
Transportation and Storage Assets (1)
Refining Assets
 
Other Assets (2)
Total
COST
As at December 31, 2022
5991,840174742,687
Acquisitions (Note 3) (3)
1248—33
Additions156——57
Divestitures (Note 3) (3)
——(19)—(19)
Exchange Rate Movements and Other(13)44(2)(4)25
As at December 31, 2023
5881,964161702,783
ACCUMULATED DEPRECIATION
As at December 31, 2022
1276455812842
Depreciation362232212293
Divestitures (Note 3) (3)
——(12)—(12)
Exchange Rate Movements and Other(7)(5)(3)(5)(20)
As at December 31, 2023
15686365191,103
CARRYING VALUE
As at December 31, 2022
4721,195116621,845
As at December 31, 2023
4321,10196511,680
(1)Includes railcars, barges, vessels, pipelines, caverns and storage tanks.
(2)Includes assets in the commercial fuels business, fleet vehicles and other equipment.
(3)In connection with the Toledo Acquisition, Cenovus was deemed to have disposed of its pre-existing interest and reacquired it at fair value as required by IFRS 3. As at February 28, 2023, the carrying value of the pre-existing interest in Toledo’s ROU assets was $7 million.
B) Lease Liabilities
Total
As at December 31, 2022
2,836
Acquisitions (Note 3) (1)
33
Additions57
Interest Expense (Note 4)
161
Lease Payments(449)
Divestitures (Note 3) (1)
(11)
Exchange Rate Movements and Other31
As at December 31, 2023
2,658
Less: Current Portion299
Long-Term Portion2,359
(1)In connection with the Toledo Acquisition, Cenovus was deemed to have disposed of its pre-existing interest and reacquired it at fair value as required by IFRS 3. As at February 28, 2023, the carrying value of the pre-existing interest in Toledo’s lease liabilities was $11 million.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
23

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
12. JOINT ARRANGEMENTS
A) Joint Operations
Cenovus has a number of joint operations in the upstream segments. The Company also holds the following joint operation in the U.S. Refining segment.
WRB Refining LP (“WRB”)
Cenovus holds a 50 percent interest in the Wood River and Borger refineries with Phillips 66. Phillips 66 holds the remaining 50 percent interest and is the operator of the Wood River Refinery in Illinois and the Borger Refinery in Texas.
B) Joint Ventures
Husky-CNOOC Madura Ltd.
The Company holds a 40 percent interest in the jointly controlled entity HCML. The Company’s share of equity investment income (loss) related to the joint venture, distributions received and contributions paid are recorded in (income) loss from equity-accounted affiliates.
Summarized below is the financial information for HCML accounted for using the equity method.
Results of Operations
Twelve Months Ended
For the periods ended December 31,
20232022
Revenue615383
Expenses545350
Net Earnings (Loss)7033
Balance Sheet
As at December 31,
20232022
Current Assets (1)
334247
Non-Current Assets1,7511,926
Current Liabilities140160
Non-Current Liabilities
1,1881,293
Net Assets757720
(1)Includes cash and cash equivalents of $111 million (December 31, 2022 – $64 million).
For the twelve months ended December 31, 2023, the Company’s share of income from the equity-accounted affiliate was $57 million (2022 – $23 million). As at December 31, 2023, the carrying amount of the Company’s share of net assets was $344 million (December 31, 2022 – $365 million). These amounts do not equal the 40 percent joint control of the revenues, expenses and net assets of HCML due to differences in the values attributed to the investment and accounting policies between the joint venture and the Company.
For the twelve months ended December 31, 2023, the Company received $93 million of distributions from HCML (2022 – $42 million) and paid $35 million in contributions (2022 – $54 million).
Husky Midstream Limited Partnership
The Company jointly owns and is the operator of HMLP. The Company holds a 35 percent interest in HMLP and applies the equity method of accounting. The Company’s share of equity investment income related to the joint venture, in excess of cumulated unrecognized losses, distributions received and contributions paid, is recorded in (income) loss from equity-accounted affiliates.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
For the years ended December 31,
20232022
HMLP Net Earnings (Loss)
231190
Cenovus’s Share of HMLP Net Earnings (Loss) (1)
(1)(23)
Cenovus’s Share of HMLP Other Comprehensive Income (Loss) (1)
(2)8
Distributions Received5623
Contributions Paid6231
(1)Cenovus does not receive 35 percent of HMLP’s net earnings and OCI due to the nature of the profit-sharing arrangement.
The carrying value of the Company’s investment in HMLP as at December 31, 2023, was $nil (December 31, 2022 – $nil) due to losses in excess of the equity investment. Cenovus had unrecognized cumulative losses from earnings and OCI, net of tax, of $31 million as at December 31, 2023 (December 31, 2022 – $28 million).
13. OTHER ASSETS
As at December 31,
20232022
Private Equity Investments (Note 22)
13155
Precious Metals7686
Net Investment in Finance Leases6162
Long-Term Receivables and Prepaids
50120
Intangible Assets (1)
—19
318342
(1)For the twelve months ended December 31, 2022, $49 million of previously capitalized intangible asset costs were written off as DD&A in the Oil Sands segment as the carrying value was not considered to be recoverable.
14. DEBT AND CAPITAL STRUCTURE
A) Short-Term Borrowings
As at December 31, Notes20232022
Uncommitted Demand Facilitiesi——
WRB Uncommitted Demand Facilitiesii179115
Total Debt Principal179115
i) Uncommitted Demand Facilities
As at December 31, 2023, the Company had uncommitted demand facilities of $1.7 billion (December 31, 2022 – $1.9 billion) in place, of which $1.4 billion may be drawn for general purposes, or the full amount may be available to issue letters of credit. As at December 31, 2023, there were outstanding letters of credit aggregating to $364 million (December 31, 2022 – $490 million) and no direct borrowings.
ii) WRB Uncommitted Demand Facilities
WRB has uncommitted demand facilities of US$450 million that may be used to cover short-term working capital requirements, of which Cenovus’s proportionate share is 50 percent. As at December 31, 2023, US$270 million was drawn on these facilities, of which Cenovus’s proportionate share was US$135 million (C$179 million). As at December 31, 2022, Cenovus’s proportionate share of the capacity was US$225 million and US$85 million (C$115 million) of this capacity was drawn.


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
B) Long-Term Debt
As at December 31,
Notes20232022
Committed Credit Facility (1)
i——
U.S. Dollar Denominated Unsecured Notesii5,0286,537
Canadian Dollar Unsecured Notesii2,0002,000
Total Debt Principal7,0288,537
Debt Premiums (Discounts), Net, and Transaction Costs80154
Long-Term Debt7,1088,691
(1) The committed credit facility may include Bankers’ Acceptances, secured overnight financing rate loans, prime rate loans and U.S. base rate loans.
i) Committed Credit Facility
As at December 31, 2023, the Company had in place a committed credit facility that consists of a $1.8 billion tranche maturing on November 10, 2025, and a $3.7 billion tranche maturing on November 10, 2026. As at December 31, 2023, no amount was drawn on the credit facility (December 31, 2022 – $nil).
ii) U.S. Dollar Denominated and Canadian Dollar Denominated Unsecured Notes
For twelve months ended December 31, 2023, the Company purchased US$1.0 billion (2022 – US$2.6 billion and C$750 million) in principal of its outstanding unsecured notes.
The principal amounts of the Company’s outstanding unsecured notes are:
2023
2022
As at December 31, US$ PrincipalC$ Principal
and Equivalent		US$ PrincipalC$ Principal
and Equivalent
U.S. Dollar Unsecured Notes
5.38% due July 15, 2025
133176133181
4.25% due April 15, 2027
373493373505
4.40% due April 15, 2029
183241240324
2.65% due January 15, 2032
500661500677
5.25% due June 15, 2037
333441583790
6.80% due September 15, 2037
191253387524
6.75% due November 15, 2039
6528629351,267
4.45% due September 15, 2042
9112197131
5.20% due September 15, 2043
27362939
5.40% due June 15, 2047
5697528001,083
3.75% due February 15, 2052
7509927501,016
3,8025,0284,8276,537
Canadian Dollar Unsecured Notes
3.60% due March 10, 2027
750750
3.50% due February 7, 2028
1,2501,250
2,0002,000
Total Unsecured Notes7,0288,537
As at December 31, 2023, the Company was in compliance with all of the terms of its debt agreements. Under the terms of Cenovus’s committed credit facility, the Company is required to maintain a total debt to capitalization ratio, as defined in the agreement, not to exceed 65 percent. The Company is well below this limit.
C) Capital Structure
Cenovus’s capital structure consists of shareholders’ equity plus Net Debt. Net Debt includes the Company’s short-term borrowings, and the current and long-term portions of long-term debt, net of cash and cash equivalents and short-term investments. Net Debt is used in managing the Company’s capital structure. The Company’s objectives when managing its capital structure are to maintain financial flexibility, preserve access to capital markets, ensure its ability to finance internally generated growth and to fund potential acquisitions while maintaining the ability to meet the Company’s financial obligations as they come due. To ensure financial resilience, Cenovus may, among other actions, adjust capital and operating spending, draw down on its credit facilities or repay existing debt, adjust dividends paid to shareholders, purchase the Company’s common shares or preferred shares for cancellation, issue new debt, or issue new shares.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
26

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Cenovus monitors its capital structure and financing requirements using, among other things, Total Debt, Net Debt to adjusted earnings before interest, taxes and DD&A (“Adjusted EBITDA”), Net Debt to Adjusted Funds Flow and Net Debt to Capitalization. These measures are used to steward Cenovus’s overall debt position as measures of Cenovus’s overall financial strength.
Cenovus targets a Net Debt to Adjusted EBITDA ratio and a Net Debt to Adjusted Funds Flow ratio of approximately 1.0 times and Net Debt at or below $4 billion over the long-term at a WTI price of US$45.00 per barrel. These measures may fluctuate periodically outside this range due to factors such as persistently high or low commodity prices.
On November 3, 2023, Cenovus filed a base shelf prospectus that allows the Company to offer, from time to time, debt securities, common shares, preferred shares, subscription receipts, warrants, share purchase contracts and units in Canada, the U.S. and elsewhere as permitted by law. The base shelf prospectus will expire in December 2025. Offerings under the base shelf prospectus are subject to market conditions on terms set forth in one or more prospectus supplements.
Net Debt to Adjusted EBITDA
As at December 31,
20232022
Short-Term Borrowings179115
Current Portion of Long-Term Debt——
Long-Term Portion of Long-Term Debt7,1088,691
Total Debt7,2878,806
Less: Cash and Cash Equivalents(2,227)(4,524)
Net Debt5,0604,282
Net Earnings (Loss)4,1096,450
Add (Deduct):
Finance Costs671820
Interest Income(133)(81)
Income Tax Expense (Recovery)9312,281
Depreciation, Depletion and Amortization4,6444,679
Exploration and Evaluation Asset Write-downs2964
(Income) Loss From Equity-Accounted Affiliates(51)(15)
Unrealized (Gain) Loss on Risk Management52(126)
Foreign Exchange (Gain) Loss, Net(67)343
Revaluation (Gain) Loss34(549)
Re-measurement of Contingent Payments59162
(Gain) Loss on Divestiture of Assets(14)(269)
Other (Income) Loss, Net(63)(532)
Adjusted EBITDA (1)
10,20113,227
Net Debt to Adjusted EBITDA (times)
0.50.3
(1)Calculated on a trailing twelve-month basis.
Net Debt to Adjusted Funds Flow
As at December 31,
20232022
Net Debt5,0604,282
Cash From (Used in) Operating Activities7,38811,403
(Add) Deduct:
Settlement of Decommissioning Liabilities(222)(150)
Net Change in Non-Cash Working Capital (1,193)575
Adjusted Funds Flow (1)
8,80310,978
Net Debt to Adjusted Funds Flow (times)
0.60.4
(1)Calculated on a trailing twelve-month basis.


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
27

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Net Debt to Capitalization
As at December 31,
20232022
Net Debt5,0604,282
Shareholders’ Equity
28,69827,576
Capitalization33,75831,858
Net Debt to Capitalization (percent)
15 13 
15. CONTINGENT PAYMENTS
In connection with the Sunrise Acquisition, Cenovus agreed to make quarterly variable payments, up to $600 million, from SOSP to bp Canada for up to eight quarters subsequent to August 31, 2022, when the average WCS price in a quarter exceeds $52.00 per barrel. The quarterly payment is calculated as $2.8 million plus the difference between the average WCS price less $53.00 multiplied by $2.8 million, for any of the eight quarters the average WCS price is equal to or greater than $52.00 per barrel. If the average WCS price is less than $52.00 per barrel, no payment will be made for that quarter. The maximum payment over the remaining term of the contract is $194 million.
The variable payment will be re-measured to fair value at each reporting date, with changes in fair value recorded to re-measurement of contingent payments.
In the twelve months ended December 31, 2023, payments totaled $299 million for the quarterly payment periods ending November 30, 2022, February 28, 2023, May 31, 2023, and August 31, 2023.
Total
As at December 31, 2022
419
Liabilities Settled or Payable(314)
Re-measurement
59
As at December 31, 2023
164
16. DECOMMISSIONING LIABILITIES
Total
As at December 31, 2022
3,559
Liabilities Incurred14
Liabilities Acquired (Note 3) (1)
5
Liabilities Settled(221)
Liabilities Disposed (Note 3) (1)
(5)
Change in Estimated Future Cash Flows330
Change in Discount Rate265
Unwinding of Discount on Decommissioning Liabilities (Note 4)
220
Exchange Rate Movements(12)
As at December 31, 2023
4,155
(1)In connection with the Toledo Acquisition, Cenovus was deemed to have disposed of its pre-existing interest and reacquired it at fair value as required by IFRS 3. As at February 28, 2023, the carrying value of the pre-existing interest in Toledo’s decommissioning liabilities was $2 million.
As at December 31, 2023, the undiscounted amount of estimated future cash flows required to settle the obligation was discounted using a credit-adjusted risk-free rate of 5.5 percent (December 31, 2022 – 6.1 percent) and assumes an inflation rate of two percent (December 31, 2022 – two percent).
The Company deposits cash into restricted accounts that will be used to fund decommissioning liabilities in offshore China in accordance with the provisions of the regulations of the People’s Republic of China. As at December 31, 2023, the Company had $211 million in restricted cash (December 31, 2022 – $209 million).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
28

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
17. OTHER LIABILITIES
As at December 31,20232022
Renewable Volume Obligation, Net (1)
397101
Pension and Other Post-Employment Benefit Plan276201
Provision for West White Rose Expansion Project
156204
Provisions for Onerous and Unfavourable Contracts7295
Employee Long-Term Incentives100245
Drilling Provisions2531
Deferred Revenue—45
Other157120
1,1831,042
(1)The gross amounts of the renewable volume obligation and renewable identification numbers asset were $785 million and $388 million, respectively (December 31, 2022 – $1.1 billion and $1.0 billion, respectively).
18. SHARE CAPITAL AND WARRANTS
A) Authorized
Cenovus is authorized to issue an unlimited number of common shares, and first and second preferred shares not exceeding, in aggregate, 20 percent of the number of issued and outstanding common shares. The first and second preferred shares may be issued in one or more series with rights and conditions to be determined by the Board of Directors prior to issuance and subject to the Company’s articles.
B) Issued and Outstanding – Common Shares
20232022
Number of
Common
Shares
(thousands)
Amount
Number of
Common
Shares
(thousands)
Amount
Outstanding, Beginning of Year1,909,19016,3202,001,21117,016
Issued Upon Exercise of Warrants2,610269,39993
Issued Under Stock Option Plans3,6795811,069170
Purchase of Common Shares Under NCIB(43,611)(373)(112,489)(959)
Outstanding, End of Year1,871,86816,0311,909,19016,320
As at December 31, 2023, there were 45.5 million (December 31, 2022 – 43.1 million) common shares available for future issuance under the stock option plan.
C) Normal Course Issuer Bid
On November 7, 2023, the Company received approval from the TSX to renew the Company’s NCIB program to purchase up to 133.2 million common shares from November 9, 2023, to November 8, 2024.
For the twelve months ended December 31, 2023, the Company purchased and cancelled 43.6 million common shares (2022 – 112.5 million) through the NCIB. The shares were purchased at a volume weighted average price of $24.32 per common share (2022 – $22.49) for a total of $1.1 billion (2022 – $2.5 billion). Paid in surplus was reduced by $688 million (2022 – $1.6 billion), representing the excess of the purchase price of the common shares over their average carrying value.
From January 1, 2024, to February 12, 2024, the Company purchased an additional 4.3 million common shares for $92 million. As at February 12, 2024, the Company can further purchase up to 118.3 million common shares under the NCIB.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
29

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
D) Issued and Outstanding – Preferred Shares
For the twelve months ended December 31, 2023, there were no preferred shares issued. As at December 31, 2023, there were 36 million preferred shares outstanding (December 31, 2022 – 36 million), with a carrying value of $519 million (December 31, 2022 – $519 million).
As at December 31, 2023
Dividend Reset Date
Dividend Rate (percent)
Number of Preferred Shares (thousands)
Series 1 First Preferred SharesMarch 31, 20262.58 10,740
Series 2 First Preferred Shares (1)
Quarterly6.77 1,260
Series 3 First Preferred SharesDecember 31, 20244.69 10,000
Series 5 First Preferred SharesMarch 31, 20254.59 8,000
Series 7 First Preferred SharesJune 30, 20253.94 6,000
(1) The floating-rate dividend was 5.86 percent from December 31, 2022, to March 30, 2023; 6.29 percent for the period from March 31, 2023, to June 29, 2023; 6.29 percent from June 30, 2023, to September 29, 2023; and 6.89 percent for the period from September 30, 2023, to December 30, 2023.
E) Issued and Outstanding – Warrants
20232022
Number of
Warrants
(thousands)
Amount
Number of
Warrants
(thousands)
Amount
Outstanding, Beginning of Year55,72018465,119215
Exercised(2,610)(8)(9,399)(31)
Purchased and Cancelled(45,485)(151)——
Outstanding, End of Year7,6252555,720184
The exercise price of the warrants is $6.54 per share.
On June 14, 2023, Cenovus purchased and cancelled 45.5 million warrants. The price for each warrant purchased represented a price of $22.18 per common share, less the warrant exercise price of $6.54 per common share, for a total of $711 million. Retained earnings was reduced by $560 million, representing the excess of the purchase price of the warrants over their average carrying value, and $2 million in transaction costs.
The purchased warrants were paid in full by December 31, 2023.
19. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Pension and Other Post-Employment BenefitsPrivate Equity InstrumentsForeign Currency Translation AdjustmentTotal
As at December 31, 2021
2827629684
Other Comprehensive Income (Loss), Before Tax962713811
Income Tax (Expense) Recovery(25)——(25)
As at December 31, 2022
99291,3421,470
Other Comprehensive Income (Loss), Before Tax(58)63(286)(281)
Reclassification on Divestiture (Note 3)
——1212
Income Tax (Expense) Recovery14(7)—7
As at December 31, 2023
55851,0681,208

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
30

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
20. STOCK-BASED COMPENSATION PLANS
Cenovus has a number of stock-based compensation plans that include NSRs, Cenovus replacement stock options, performance share units (“PSUs”), restricted share units (“RSUs”) and deferred share units.
On February 27, 2023, Cenovus granted PSUs and RSUs to certain employees under its new Performance Share Unit Plan for Local Employees in the Asia Pacific Region and Restricted Share Unit Plan for Local Employees in the Asia Pacific Region. The PSUs are time-vested whole-share units that entitle employees to receive a cash payment equal to the value of a Cenovus common share. The number of units eligible to vest is determined by a multiplier that ranges from zero percent to 200 percent and is based on the Company achieving key pre-determined performance measures. The RSUs are whole-share units and entitle employees to receive, upon vesting, a cash payment equal to the value of a Cenovus common share.
The following tables summarize information related to the Company’s stock-based compensation plans:
Units
Outstanding
Units
Exercisable
As at December 31, 2023
(thousands)(thousands)
Stock Options With Associated Net Settlement Rights11,8956,658 
Cenovus Replacement Stock Options1,0051,005 
Performance Share Units10,243— 
Restricted Share Units7,234— 
Deferred Share Units1,6911,691 
The weighted average exercise price of NSRs and Cenovus replacement stock options outstanding as at December 31, 2023, were $13.66 and $6.49, respectively.
Units
Granted
Units
Vested and
Exercised/
Paid Out
For the twelve months ended December 31, 2023
(thousands)(thousands)
Stock Options With Associated Net Settlement Rights1,5713,839
Cenovus Replacement Stock Options—2,113
Performance Share Units2,539972
Restricted Share Units2,9612,300
Deferred Share Units18537
Weighted Average Exercise Price
Units
Exercised
For the twelve months ended December 31, 2023
($/unit)(thousands)
Stock Options With Associated Net Settlement Rights Exercised for Net Cash Payment12.853,621
Stock Options With Associated Net Settlement Rights Exercised and Net Settled for Common Shares (1)
17.02218
Cenovus Replacement Stock Options Exercised and Net Settled for Cash9.982,110
Cenovus Replacement Stock Options Exercised and Net Settled for Common Shares (2)
3.543
(1)NSRs were net settled for 56 thousand common shares.
(2)Cenovus replacement stock options were net settled for 2 thousand common shares.
The following table summarizes the stock-based compensation expense (recovery) recorded for all plans:
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Stock Options With Associated Net Settlement Rights231115
Cenovus Replacement Stock Options(4)17(5)53
Performance Share Units(78)11747183
Restricted Share Units(10)3546100
Deferred Share Units(9)8(2)22
Stock-Based Compensation Expense (Recovery)(99)18097373

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
31

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
21. RELATED PARTY TRANSACTIONS
Transactions with HMLP are related party transactions as the Company has a 35 percent ownership interest (see Note 12). As the operator of the assets held by HMLP, Cenovus provides management services for which it recovers shared service costs.
The Company is also the contractor for HMLP and constructs its assets based on fixed price contracts or on a cost recovery basis with certain restrictions. For the three and twelve months ended December 31, 2023, the Company charged HMLP $48 million and $160 million, respectively (three and twelve months ended December 31, 2022 – $55 million and $188 million, respectively), for construction costs and management services.
The Company pays an access fee to HMLP for pipeline systems that are used by Cenovus’s blending business. Cenovus also pays HMLP for transportation and storage services. For the three and twelve months ended December 31, 2023, the Company incurred costs of $90 million and $295 million, respectively (three and twelve months ended December 31, 2022 – $66 million and $263 million, respectively), for the use of HMLP’s pipeline systems, as well as for transportation and storage services.
22. FINANCIAL INSTRUMENTS
Cenovus’s financial assets and financial liabilities consist of cash and cash equivalents, accounts receivable and accrued revenues, restricted cash, risk management assets and liabilities, accounts payable and accrued liabilities, short-term borrowings, lease liabilities, contingent payments, long-term debt and certain portions of other assets and other liabilities. Risk management assets and liabilities arise from the use of derivative financial instruments.
A) Fair Value of Non-Derivative Financial Instruments
The fair values of cash and cash equivalents, accounts receivable and accrued revenues, accounts payable and accrued liabilities, and short-term borrowings approximate their carrying amount due to the short-term maturity of these instruments.
The fair values of restricted cash, certain portions of other assets and other liabilities, approximate their carrying amount due to the specific non-tradeable nature of these instruments.
Long-term debt is carried at amortized cost. The estimated fair value of long-term debt was determined based on period-end trading prices of long-term debt on the secondary market (Level 2). As at December 31, 2023, the carrying value of Cenovus’s long-term debt was $7.1 billion and the fair value was $6.6 billion (December 31, 2022, carrying value – $8.7 billion; fair value – $7.8 billion).
The Company classifies certain private equity investments as FVOCI as they are not held for trading and fair value changes are not reflective of the Company’s operations. These assets are carried at fair value in other assets. Fair value is determined based on recent private placement transactions (Level 3) when available.
The following table provides a reconciliation of changes in the fair value of private equity investments classified as FVOCI:
2023
Fair Value, Beginning of Year55
Acquisitions13
Changes in Fair Value
63
Fair Value, End of Year131
B) Fair Value of Risk Management Assets and Liabilities
Risk management assets and liabilities are carried at fair value in accounts receivable and accrued revenues, accounts payable and accrued liabilities (for short-term positions), other liabilities and other assets (for long-term positions). Changes in fair value are recorded in (gain) loss on risk management.
The Company’s risk management assets and liabilities consist of crude oil, condensate, natural gas, and refined product futures, as well as renewable power, power and foreign exchange contracts. The Company may also enter into swaps, forwards, and options to manage commodity, foreign exchange and interest rate exposures.
Crude oil, natural gas, condensate, refined product and power contracts are recorded at their estimated fair value based on the difference between the contracted price and the period-end forward price for the same commodity, using quoted market prices or the period-end forward price for the same commodity extrapolated to the end of the term of the contract (Level 2). The fair value of foreign exchange rate contracts is calculated using external valuation models that incorporate observable market data and foreign exchange forward curves (Level 2).


Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
32

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
The fair value of renewable power contracts are calculated using internal valuation models that incorporate broker pricing for relevant markets, some observable market prices and extrapolated market prices with inflation assumptions (Level 3). The fair value of renewable power contracts are calculated by Cenovus’s internal valuation team that consists of individuals who are knowledgeable and have experience in fair value techniques.
Summary of Risk Management Positions
20232022
Risk ManagementRisk Management
As at December 31,AssetLiabilityNetAssetLiabilityNet
Crude Oil, Natural Gas, Condensate and Refined Products1119(8)240(38)
Power Swap Contracts2—217(6)
Renewable Power Contracts18—1890—90
311912934746
The following table presents the Company’s fair value hierarchy for risk management assets and liabilities carried at fair value:
As at December 31, 20232022
Level 2 – Prices Sourced From Observable Data or Market Corroboration(6)(44)
Level 3 – Prices Sourced From Partially Unobservable Data1890
1246
The following table provides a reconciliation of changes in the fair value of Cenovus’s risk management assets and liabilities:
2023
Fair Value of Contracts, Beginning of Year46
Change in Fair Value of Contracts Entered Into During the Year(45)
Fair Value of Contracts Realized During the Year9
Unrealized Foreign Exchange Gain (Loss) on U.S. Dollar Contracts2
Fair Value of Contracts, End of Year12
C) Earnings Impact of (Gains) Losses From Risk Management Positions
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Realized (Gain) Loss813491,762
Unrealized (Gain) Loss(36)(38)52(126)
(Gain) Loss on Risk Management
(28)96611,636
Realized and unrealized gains and losses on risk management are recorded in the reportable segment to which the derivative instrument relates.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
33

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
D) Fair Value of Contingent Payments
The variable payment (Level 3) associated with the Sunrise Acquisition is carried at fair value in the contingent payments. Fair value is estimated by calculating the present value of the expected future cash flows using an option pricing model, which assumes the probability distribution for WCS is based on the volatility of WTI options, volatility of Canadian-U.S. foreign exchange rate options and both WTI and WCS futures pricing that was discounted using a credit-adjusted risk-free rate. Fair value of the variable payment was calculated by Cenovus’s internal valuation team, which consists of individuals who are knowledgeable and have experience in fair value techniques. As at December 31, 2023, the fair value of the variable payment was estimated to be $164 million applying a credit-adjusted risk-free rate of 5.6 percent.
As at December 31, 2023, average WCS forward pricing for the remaining term of the variable payment is $71.86 per barrel. The average volatility of WTI options and the Canadian-U.S. foreign exchange rates was 39.4 percent and 5.8 percent, respectively.
As at December 31, 2023, changes in WCS forward prices, with fluctuations in all other variables held constant, could have impacted earnings before income tax as follows:
Sensitivity RangeIncreaseDecrease
WCS Forward Prices
± $10.00 per barrel
(21)45
As at December 31, 2023, a 10 percent increase or decrease in WTI option price volatility, or a five percent increase or decrease in Canadian to U.S. dollar foreign exchange rate option volatility would have resulted in nominal changes to earnings before income tax.
23. RISK MANAGEMENT
Cenovus is exposed to financial risks, including market risk related to commodity prices, foreign exchange rates, interest rates, commodity power prices as well as credit risk and liquidity risk.
To manage exposure to commodity price movements between when products are produced or purchased and when sold to the customer or used by Cenovus, the Company may periodically enter into financial positions as a part of ongoing operations to market the Company’s production and physical inventory positions of crude oil, natural gas, condensate, refined products, and power consumption. The Company may also enter into arrangements, such as renewable power contracts or power swaps, to manage exposure to future carbon compliance costs, power prices, energy costs associated with the production, transportation and refining of crude oil, or to offset select carbon emissions.
To manage exposure to interest rate volatility, the Company may enter into interest rate swap contracts. To mitigate the Company’s exposure to foreign exchange rate fluctuations, the Company periodically enters into foreign exchange contracts. To manage interest costs on short-term borrowings, the Company periodically enters into cross currency interest rate swaps.
As at December 31, 2023, the fair value of risk management positions was a net asset of $12 million (see Note 22). As at December 31, 2023, there were no foreign exchange contracts, interest rate contracts or cross currency interest rate swap contracts outstanding. As at December 31, 2022, there were forward exchange contracts with a notional value of US$168 million outstanding.











Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
34

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
Net Fair Value of Risk Management Positions
As at December 31, 2023
Notional Volumes (1) (2)
Terms (3)
Weighted
Average
Price (1) (2)
Fair Value Asset (Liability)
Futures Contracts Related to Blending (4)
WTI Fixed – Sell
3.5 MMbbls
January 2024 – December 2024
US$75.22/bbl
16
WTI Fixed – Buy
1.5 MMbbls
January 2024 – December 2024
US$73.69/bbl
(4)
Power Swap Contracts2
Renewable Power Contracts18
Other Financial Positions (5)
(20)
Total Fair Value12
(1)    Million barrels (“MMbbls”).
(2)    Notional volumes and weighted average price are based on multiple contracts of varying amounts and terms over the respective time period; therefore, the notional volumes and weighted average price may fluctuate from month to month.
(3)    Includes individual contracts with varying terms, the longest of which is 13 months.
(4)    WTI futures contracts are used to help manage price exposure to condensate used for blending.
(5)    Includes risk management positions related to WCS, heavy oil and condensate differential contracts, Belvieu fixed price contracts, reformulated blendstock for oxygenate blending gasoline contracts, heating oil and natural gas fixed price contracts and the Company’s U.S. refining and marketing activities.
A) Commodity Price and Foreign Exchange Rate Risk
Sensitivities
The following table summarizes the sensitivity of the fair value of Cenovus’s risk management positions to independent fluctuations in commodity prices and foreign exchange rates, with all other variables held constant. Management believes the fluctuations identified in the table below are a reasonable measure of volatility.
The impact of the below on the Company’s open risk management positions could have resulted in an unrealized gain (loss) impacting earnings before income tax as follows:
As at December 31, 2023
Sensitivity RangeIncreaseDecrease
Power Commodity Price
± C$20.00/MWh (1) Applied to Power Hedges
92(92)
(1)One thousand kilowatts of electricity per hour (“MWh”).
A sensitivity analysis for the following fluctuating commodity prices and foreign exchange rates on the Company’s open risk management positions was found to result in a nominal unrealized gain (loss) impacting earnings before income tax:
•A US$10.00 per barrel increase or decrease in the benchmark crude oil and benchmark condensate commodity price (primarily WTI).
•A US$2.50 per barrel increase or decrease in the WCS (excluding the Hardisty location) and condensate differential price.
•A US$5.00 per barrel increase or decrease in the WCS differential price.
•A US$10.00 per barrel increase or decrease in refined products commodity prices.
•A US$1.00 per one thousand cubic feet increase or decrease in the Henry Hub commodity price.
•A US$0.50 per one thousand cubic feet increase or decrease in natural gas basis prices.
•A $0.05 increase or decrease in the U.S. to Canadian dollar exchange rate.
B) Credit Risk
Credit risk arises from the potential that the Company may incur a financial loss if a counterparty to a financial instrument fails to meet its financial or performance obligations in accordance with agreed terms. Cenovus has in place a Credit Policy approved by the Audit Committee and the Board of Directors, which is designed to ensure that its credit exposures are within an acceptable risk level. The Credit Policy outlines the roles and responsibilities related to credit risk, sets a framework for how credit exposures will be measured, monitored and mitigated, and sets parameters around credit concentration limits.
Cenovus assesses the credit risk of new counterparties and continues risk-based monitoring of all counterparties on an ongoing basis. A substantial portion of Cenovus’s accounts receivable are with customers in the oil and gas industry and are subject to normal industry credit risks. Cenovus’s exposure to its counterparties is within its credit policy tolerances. The maximum credit risk exposure associated with accounts receivable and accrued revenues, net investment in finance leases, risk management assets and long-term receivables is the total carrying value.
As at December 31, 2023, approximately 83 percent (December 31, 2022 – 85 percent) of the Company’s accounts receivable and accrued revenues were with investment grade counterparties, and 98 percent of the Company’s accounts receivable were outstanding for less than 60 days. The associated average expected credit loss on these accounts was 0.4 percent as at December 31, 2023 (December 31, 2022 – 0.4 percent).

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
35

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
C) Liquidity Risk
Liquidity risk is the risk that the Company will not be able to meet all of its financial obligations as they become due. Liquidity risk also includes the risk of not being able to liquidate assets in a timely manner at a reasonable price. Cenovus manages its liquidity risk through the active management of cash and debt, by maintaining appropriate access to credit, which may be impacted by the Company’s credit ratings, and by ensuring that it has access to multiple sources of capital. As disclosed in Note 14, over the long term, Cenovus targets a Net Debt to Adjusted EBITDA ratio and Net Debt to Adjusted Funds Flow ratio of approximately 1.0 times at the bottom of the commodity price cycle to manage the Company’s overall debt position.
Undiscounted cash outflows relating to financial liabilities are:
As at December 31, 2023
 1 YearYears 2 and 3Years 4 and 5ThereafterTotal
Accounts Payable and Accrued Liabilities (1)
5,480———5,480
Short-Term Borrowings
179———179
Contingent Payments168———168
Lease Liabilities (2)
4387125692,6354,354
Long-Term Debt (2)
3137923,0077,14511,257
As at December 31, 2022
1 YearYears 2 and 3Years 4 and 5ThereafterTotal
Accounts Payable and Accrued Liabilities (1)
6,124———6,124
Short-Term Borrowings
115———115
Contingent Payments271167——438
Lease Liabilities (2)
4267465962,8894,657
Long-Term Debt (2)
4019832,01411,19614,594
(1)Includes current risk management liabilities.
(2)Principal and interest, including current portion, if applicable.
24. SUPPLEMENTARY CASH FLOW INFORMATION
A) Working Capital
As at December 31,
20232022
Total Current Assets 9,70812,430
Total Current Liabilities 6,2108,021
Working Capital 3,4984,409
As at December 31, 2023, adjusted working capital, which excludes the current portion of the contingent payments, was $3.7 billion (December 31, 2022 – $4.7 billion).
Changes in non-cash working capital is as follows:
Three Months EndedTwelve Months Ended
For the periods ended December 31,
2023202220232022
Accounts Receivable and Accrued Revenues1,411719314838
Income Tax Receivable(283)30(295)(58)
Inventories55929216(143)
Accounts Payable and Accrued Liabilities(754)(136)(685)(524)
Income Tax Payable(56)123(1,112)1,000
Total Change in Non-Cash Working Capital877765(1,562)1,113
Net Change in Non-Cash Working Capital – Operating Activities949673(1,193)575
Net Change in Non-Cash Working Capital – Investing Activities(72)92(369)538
Total Change in Non-Cash Working Capital877765(1,562)1,113

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
36

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
B) Reconciliation of Liabilities
The following table provides a reconciliation of liabilities to cash flows arising from financing activities:
Dividends PayableWarrant Purchase PayableShort-Term BorrowingsLong-Term DebtLease Liabilities
As at December 31, 2021
——7912,3852,957
Changes From Financing Cash Flows:
Net Issuance (Repayment) of Short-Term Borrowings——34——
Repayment of Long-Term Debt
———(4,149)—
Principal Repayment of Leases————(302)
Base Dividends Paid on Common Shares(682)————
Variable Dividends Paid on Common Shares(219)————
Dividends Paid on Preferred Shares(26)————
Non-Cash Changes:
Net Premium (Discount) on Redemption of Long-Term Debt———(29)—
Finance and Transaction Costs———(28)—
Lease Additions————25
Base Dividends Declared on Common Shares 682————
Variable Dividends Declared on Common Shares219————
Dividends Declared on Preferred Shares35————
Exchange Rate Movements and Other——2512156
As at December 31, 2022
9—1158,6912,836
Changes From Financing Cash Flows:
Net Issuance (Repayment) of Short-Term Borrowings——58——
Repayment of Long-Term Debt
———(1,346)—
Principal Repayment of Leases————(288)
Base Dividends Paid on Common Shares(990)————
Dividends Paid on Preferred Shares(36)————
Payment for Purchase of Warrants—(711)———
Finance and Transaction Costs—(2)———
Non-Cash Changes:
Net Premium (Discount) on Redemption of Long-Term Debt———(84)—
Finance and Transaction Costs—2—(19)—
Lease Acquisitions————33
Lease Additions————57
Lease Divestitures————(11)
Base Dividends Declared on Common Shares 990————
Dividends Declared on Preferred Shares36————
Warrants Purchased and Cancelled—711———
Exchange Rate Movements and Other——6(134)31
As at December 31, 2023
9—1797,1082,658

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
37

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
25. COMMITMENTS AND CONTINGENCIES
A) Commitments
Cenovus has entered into various commitments in the normal course of operations. Commitments that have original maturities less than one year are excluded from the table below. Future payments for the Company’s commitments are below:
As at December 31, 2023
1 Year2 Years3 Years4 Years5 YearsThereafterTotal
Transportation and Storage (1) (2)
2,0181,9271,6801,6631,64115,73824,667
Product Purchases
617—————617
Real Estate
5757596358604898
Obligation to Fund HCML
949494895290513
Other Long-Term Commitments (3)
4171941841751669652,101
Total Commitments
3,2032,2722,0171,9901,91717,39728,796
(1)Includes transportation commitments that are subject to regulatory approval or were approved, but are not yet in service of $13.0 billion. Terms are up to 20 years on commencement. Estimated tolls are subject to change pending review by the Canada Energy Regulator.
(2)As at December 31, 2023, includes $2.1 billion related to long-term transportation and storage commitments with HMLP.
(3)The Company acquired $538 million of commitments as part of the Toledo Acquisition on February 28, 2023.
There were outstanding letters of credit aggregating to $364 million (December 31, 2022 – $490 million) issued as security for financial and performance conditions under certain contracts. Subsequent to December 31, 2023, Cenovus entered into a new transportation commitment for $587 million.
B) Contingencies
Legal Proceedings
Cenovus is involved in a limited number of legal claims associated with the normal course of operations. Cenovus believes that any liabilities that might arise from such matters, to the extent not provided for, are not likely to have a material effect on its interim Consolidated Financial Statements.
Income Tax Matters
The tax regulations and legislation and interpretations thereof in the various jurisdictions in which Cenovus operates are continually changing. As a result, there are usually a number of tax matters under review. Management believes that the provision for taxes is adequate.
26. PRIOR PERIOD REVISIONS
Certain comparative information presented in the Consolidated Statements of Earnings (Loss) and segment disclosures was revised for classification changes.
In September 2023, the Company made adjustments to ensure the consistent treatment of sales between segments and to correct the elimination of these transactions on consolidation. The following adjustments were made:
•Report Conventional segment sales between segments on a gross basis, which resulted in a reclassification between gross sales and transportation and blending expense.
•Report sales of feedstock between the Oil Sands, Conventional and U.S. Refining segments on a net basis, which resulted in a reclassification between gross sales and purchased product.
Offsetting adjustments were made to the Corporate and Eliminations segment. The above items had no impact to net earnings (loss), operating margin, segment income (loss), cash flows or financial position.
It was also identified that the elimination of sales of diluent, natural gas and associated transportation costs between segments were recorded to the incorrect line item in the Corporate and Eliminations segment. The adjustment resulted in an understatement of operating expense, overstatement of purchased product and an overstatement of transportation and blending expense on the Consolidated Statements of Earnings (Loss). There was no impact to net earnings (loss), operating margin, segment income (loss), cash flows or financial position.

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
38

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
All amounts in $ millions, unless otherwise indicated
For the periods ended December 31, 2023
The following table reconciles the amounts previously reported in the Consolidated Statements of Earnings (Loss) and segmented disclosures to the corresponding revised amounts:
Three and Twelve Months Ended December 31, 2022
Three Months Ended December 31, 2022Twelve Months Ended December 31, 2022

Oil Sands Segment		Previously ReportedRevisionsRevised BalancePreviously ReportedRevisionsRevised Balance
Gross Sales
6,731 (78)6,65334,775 (92)34,683 
Purchased Product594 (78)516 4,810 (92)4,718 
6,137 — 6,137 29,965 — 29,965 
Conventional Segment
Gross Sales1,131 22 1,1534,332 107 4,439 
Transportation and Blending37 22 59 143 107 250 
1,094 — 1,094 4,189 — 4,189 

U.S. Refining Segment
Gross Sales
6,608 (78)6,530 30,310 (92)30,218 
Purchased Product5,747 (78)5,669 26,112 (92)26,020 
861—8614,198 — 4,198

Corporate and Eliminations Segment
Gross Sales(1,749)134 (1,615)(7,464)77 (7,387)
Purchased Product
(1,320)168 (1,152)(5,533)341 (5,192)
Transportation and Blending(136)(128)(264)(664)(511)(1,175)
Operating(352)94 (258)(1,270)247 (1,023)
59—593—3

Consolidated
Purchased Product6,908 12 6,920 33,801 157 33,958 
Transportation and Blending2,826 (106)2,720 11,530 (404)11,126 
Operating1,362 94 1,456 5,569 247 5,816 
11,096—11,09650,900—50,900

Cenovus Energy Inc. – Q4 2023 Interim Consolidated Financial Statements
39

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