Cenovus Energy Inc. (NYSE:CVE) Q1 2017 Earnings Conference Call - Preliminary Transcript

Apr 26, 2017 • 11:00 am ET

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Cenovus Energy Inc. (NYSE:CVE) Q1 2017 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and thank you for standing by. Welcome to Cenovus Energy's first quarter 2017 financial and operating results. As a reminder, today's call is being recorded. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session [Operator Instructions]. Members of the investments community will have the opportunity to ask questions first. At the conclusion of that session, members of the media may then ask questions. Please be advised that this conference call may not be recorded or rebroadcast without the expressed consent of Cenovus Energy.

I would now like to turn the conference call over to Mr. Kam Sandhar, Vice President Investor Relations and Corporate Development. Please go ahead, Mr. Sandhar.

Executive
Kam Sandhar

Thank you, Operator. And welcome, everyone to our first quarter 2017 results conference call. I would like to refer you to the advisories located at the end of today's news release. These advisories describe the forward-looking information, non-GAAP measures, and oil and gas terms referred to today, and outline the risk factors and assumptions relevant to this discussion. Additional information is available in our most recent annual information form or Form 40-F. The quarterly results have been presented in clean dollars and on a before royalties basis. We've posted a link to our quarterly results on our home page of our Web site at cenovus.com.

Brian Ferguson, our President and CEO, will provide brief comments. And then we'll turn to the Q&A portion of the call with Cenovus' leadership team. Please go ahead, Brian.

Executive
Brian Ferguson

Thanks, Kam. Good morning, everyone. I'm pleased to report that the first three months of 2017 marked yet another solid operational quarter for Cenovus. We also mark a turning point for our Company. While 2016 brought heightened commodity price volatility, Cenovus proved its resilience and entered 2017 in a position to take advantage of the significant liquidity and improved cost structures that we've achieved since 2014. In a volatile commodity price environment, economies of scale are important and the acquisition we announced last month approximately doubles the scale of our Company.

This is something that I believe will give us a greater competitive edge and it transforms us into a better stronger company with long-term upside potential. The oil sands will continue to be our prime focus. The production ramp up of the latest Foster Creek and Christina Lake expansion phases, as well as the go forward capital efficiencies that we've been able to achieve for Christina Lake phase G and for potential future expansions, reinforces the strategic rationale for consolidating our ownership in these top tier oil sands assets.

In the first quarter of 2017, Foster Creek production averaged approximately 81,000 barrels per day net, a 33% increase from the first quarter of last year. Our successful execution of our focused well maintenance program and completion and start up of seven new well pads, including the on-time start up of phase G in 2016, reaffirms our teams ability to leverage 15 years