UPDATE 2-Cenovus posts quarterly loss, awaits East pipeline

Thu Feb 14, 2013 4:19pm EST
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* Q4 oper loss C$0.25/shr vs year-earlier profit C$0.44

* Plans to be main shipper on West-East oil pipeline

* Shares fall 2.5 percent in Toronto (New throughout with CEO comments, details, background)

By Jeffrey Jones

CALGARY, Alberta, Feb 14 (Reuters) - Cenovus Energy Inc sank into the red in the fourth quarter, missing analysts' expectations on a hefty writedown of noncore natural gas properties and weaker refining results, prompting a 2.5 percent drop in the stock on Thursday.

Cenovus, Canada's second-largest independent oil producer, also said it was making a series of moves to reduce the impact of deeply discounted heavy crude prices, including refining, hedging, shipping oil by rail, and committing to buy space on pipelines that are planned to Canada's West Coast and to the U.S. Gulf Coast.

It also plans a big show of support for TransCanada Corp's proposal to transport Alberta crude to Eastern Canada via a converted natural gas pipeline.

Canadian heavy crude prices have come under severe pressure due to a combination of surging production, a glut of supplies in traditional U.S. Midwest markets and limited export pipeline capacity.

Cenovus, best known for its Foster Creek and Christina Lake oil sands projects in northern Alberta, recorded a net loss of C$118 million ($117.7 million), or 16 Canadian cents a share, compared with a year-earlier profit of C$266 million, or 35 Canadian cents a share.   Continued...