Cenovus profit soars as partner search extended

Wed Feb 15, 2012 2:44pm EST
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By Scott Haggett

(Reuters) - Cenovus Energy Inc (CVE.TO: Quote), Canada's No. 2 independent oil producer, said on Wednesday its quarterly profit tripled on production gains as it again extended its hunt for a joint-venture partner for a planned Alberta oil sands development.

The company, known for its oil sands production and U.S. refining joint ventures with ConocoPhillips (COP.N: Quote), is looking for a partner for its proposed 90,000 barrel per day Telephone Lake project.

The process, originally scheduled to be wrapped up by the end of 2011, has been extended again as Cenovus assesses some new international interest. But the company is shying away from being tied down on when a decision will be made.

"I don't have an artificial deadline that I feel any kind of pressure (to meet)" Brian Ferguson, the company's chief executive, said in an interview. "I'm prepared to take as long as it takes to get the ... transaction that, I believe, adds strategic value for us."

Ferguson said Cenovus has yet to decide what sort of partnership it wants, or if it even wants a partner as its assesses the offers on the table.

"I'm being very open-minded about this," he said. "It could be a joint venture where Cenovus is the operator with a partner, it could be a swap, it could be an outright divestiture and it could be a farm-out. We are looking at a variety of commercial arrangements."

Oil sands and shale gas developers in Canada, including Encana Corp (ECA.TO: Quote), Talisman Energy Inc TLM.TO and Statoil (STL.OL: Quote), have already lined up partners willing to contribute the cash needed to develop their vast reserves in northern Alberta and British Columbia.

International companies, particularly Asian concerns looking for a slice of Canada's oil sands and shale gas resources, have been surging into the country in recent months.   Continued...