Cenovus Energy Inc. (NYSE:CVE) Q3 2023 Earnings Call Transcript

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And then as it comes into full operation into Q2 sometime, we do expect in the second half of next year for it to kind of tighten back up to what we saw when we had some egress space here earlier this year and in late last year. So, we would expect it to come down substantially from where it is, probably in the order of half of what we’re seeing today. But that probably will, we won’t show itself till it’s actually up and operational and probably gets through some of its bumpiness as it starts up.

Jonathan McKenzie: Manav, I’d say one of the big differences this year from last year, and we certainly saw differentials widen last year when we had the keystone outage and the like, but with the upstream, or sorry, with the downstream up and running and performing the way it is does insulate us from a lot of those wider spreads that we were exposed to last year. So, while at a corporate level, uh, we’d still like to see narrower spreads we’re much less exposed to that kind of widening through the fourth and fourth first quarter this year than we were last year. So, we’re again, really pleased to have those refining assets up running and performing well.

Manav Gupta: Perfect. I’m going to ask a follow-up question, based on the response you provided to John. I got a whole bunch of questions on my Bloomberg, so I’m going to follow-up on this, as it relates to those two assets, sir, is it more of a case of a price or is it more of a case that you always thought of Toledo as a core asset you want to operate, and these two don’t actually fit that picture. Which one is it more? Is it price or is it more of they don’t fit?

Jonathan McKenzie: What I want to tell you is, is Toledo’s an absolutely core asset for us. It consumes 90,000 barrels a day of heavy, and it consumes the molecules that we produce inside our upstream. It consumes Christina Lake and it consumes sunrise heavy oil and provides us insulation against heavy oil differentials and location differential. So, it’s an absolutely core asset for us and a key piece of infrastructure. What I don’t want to do is give anybody the impression that we’re doing anything other than focusing on our base business right now. And our core set of assets that we have our intention is to continue to build on the operating momentum. We have drive our debt down to $4 billion, move to a hundred percent shareholder payout. That is our focus right now. And I understand there’s rumor swirling, but they shouldn’t be.

Manav Gupta: Thank you. Congrats on a great quarter and good to see downstream make a material big contribution.

Operator: [Operator Instructions]. There are no further questions that includes our question and answer session. I’ll hand a call back to Mr. McKenzie for the closing remarks.

Jonathan McKenzie: Okay. Well, thank you very much, everybody. We certainly appreciate your interest in the company and wish you the best, and we’ll talk to you again in the New Year. Thank you.

Operator: Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect.

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