Canada’s Cenovus Energy Inc. (NYSE: CVE) said on March 22 it was running oil-sands production below capacity and stockpiling excess oil due to trouble with exporting through maxed-out pipelines to the U.S.
The company forecast first-quarter production to double from a year earlier, but blamed transportation bottlenecks for reduced prices of its crude, compared to U.S. alternatives.
Canadian heavy oil discount has widened against the West Texas Intermediate benchmark recently as growing inventories have led to a supply buildup.
“We’re taking steps to respond to a critical shortage of export pipeline capacity in Western Canada that is beyond our control and is having a negative impact on our industry and the broader Canadian economy,” Alex Pourbaix, Cenovus Energy’s CEO, said.
The Calgary-based company said it expected to produce 350,000 barrels per day (bbl/d) to 360,000 bbl/d this year, compared with 181,501 bbl/d a year earlier.
Cenovus maintained its full year production of 364,000 bbl/d to 382,000 bbl/d.
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