Canadian oil company, Cenovus Energy Inc. CVE announced that it has safely evacuated all staff from its Foster Creek oil sands and Athabasca natural gas operations. It has also shut down production there as a precaution against a forest fire on the Cold Lake Air Weapons Range or CLAWR in northeastern Alberta.
The forest fire is currently burning about 25 kilometres south of Cenovus's Foster Creek facility. There has been no damage to the Foster Creek infrastructure as yet. The decision to send staff home and shut down production was primarily taken due to the fire's proximity to the only access road to the plants.
Foster Creek is considered one of the best commercial and technical steam-assisted gravity drainage (SAGD) projects in the industry. It is situated in the Cold Lake Air Weapons Range, which is about 330 kilometers northeast of Edmonton, Alberta. The company started a pilot project at Foster Creek in 1996 and commercial production began in 2001. The oil at Foster Creek is located about 450 metres below the surface and requires specialized technology, like SAGD, to drill and pump it out to the surface. This project is 50% owned by ConocoPhillips COP. Foster Creek’s current average daily production is approximately 67,500 barrels per day (bbls/d) net to Cenovus (135,000 bbls/d gross).
Headquartered in Calgary, Alberta, Cenovus is an integrated oil company with ownership interest in two high-quality refineries in Illinois and Texas. Cenovus’ operations include increasing oil projects and growing natural gas and crude oil production in Alberta and Saskatchewan.
Cenovus enjoys the benefits of industry-leading oil sands assets that position it for long-term growth. We believe that the company will remain focused on enhancing its operational efficiency throughout 2015.
Currently, Cenovus carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy sector are Transmontaigne Partners L.P TLP and Pembina Pipeline Corporation PBA. Both stocks carry a Zacks Rank #1 (Strong Buy).
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