Canadian oil producer Cenovus Energy Inc. (NYSE: CVE) has put a package of some of its Deep Basin gas assets up for sale, the company's new CEO said Nov. 15, adding that Cenovus was looking to reduce costs in the long term.
"If there's anything that I might put a slight twist on strategy, it's going to be re-emphasizing the focus on bottom line, profitability and returning value," Alex Pourbaix said in his first news media briefing since taking charge last week.
Cenovus has raised just under C$4 billion (US$3.1 billion) of a targeted C$4 billion to C$5 billion to pay down debt incurred in buying some of ConocoPhillips Co.'s (NYSE: COP) Canadian assets in March, as foreign oil majors retreated from the country.
Pourbaix, 52, who has a law degree, replaced Brian Ferguson, an accountant by training, who left after investors balked at the purchase, sending its stock to a record low of C$9.41, losing about half its market value.
While some investors have said they hoped for a CEO with direct technical experience, Pourbaix said Cenovus had not had such criteria, and that shareholders have been generally pleased with his vision for the company
On Nov. 15, the shares of Calgary, Alberta-based Cenovus were trading down 1.8 percent at C$13.01, in line with other energy companies, while the benchmark Canada stock index was flat.
Pourbaix, a former executive with the pipeline company TransCanada Corp. (NYSE: TRP), said more divestitures were needed, and that the company had to prove to investors that it could efficiently operate the assets bought from ConocoPhillips.
He did not elaborate on the specific Deep Basin assets—which straddle the provinces of British Columbia and Alberta—to be sold beyond saying only they would be "noncore" and declined to say how much the company expected to fetch.
Reuters has reported the company has been talking to potential buyers.
Beyond divestitures and delivering on the ConocoPhillips assets, the path charted by Ferguson, the company will focus on cutting costs so that it can compete with its global peers, Pourbaix said.
Pourbaix said he also will be examining the company's current long-term commitments "to see if there's an opportunity where we can add value," although he did not go into details. (US$1 = C$1.2782)