{"id":132378,"date":"2025-09-09T23:30:09","date_gmt":"2025-09-09T23:30:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/132378\/"},"modified":"2025-09-09T23:30:09","modified_gmt":"2025-09-09T23:30:09","slug":"cenovus-to-divest-two-u-s-refineries-in-latest-asset-shuffle","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/132378\/","title":{"rendered":"Cenovus to divest two U.S. refineries in latest asset shuffle"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Cenovus Energy\u2019s president and chief executive said the sale will help \u2018focus\u2019 the company\u2019s downstream business.AMBER BRACKEN\/The Canadian Press<\/p>\n

Cenovus Energy Inc. CVE-T<\/a> is selling its 50-per-cent stake in two U.S. refineries for US$1.4-billion in cash, the latest move by the Calgary-based company to rejig its asset portfolio. <\/p>\n

Cenovus announced Tuesday that it would sell its interest in WRB Refining LP to its joint venture partner, Phillips 66. The assets include the Wood River Refinery in Illinois and the Borger Refinery in Texas, which have a combined refining capacity of 495,000 barrels a day. <\/p>\n

Jon McKenzie, Cenovus president and chief executive, said in a statement that the deal underscores the company\u2019s strategy of owning and operating assets that are core to its business. <\/p>\n

\u201cAfter the sale of WRB, our downstream business will be more focused, comprised of assets we control,\u201d he said. <\/p>\n

Strathcona boosts bid for MEG Energy to top Cenovus offer<\/a><\/p>\n

The transaction is expected to close in the third quarter of the year, at which point Cenovus\u2019s downstream business will comprise its upgrader and refinery in Lloydminster, Alta., and, in the U.S., its refineries in Lima and Toledo (both in Ohio) and Superior, Wis., all of which it operates alone. <\/p>\n

Together, those sites can refine around 472,800 barrels a day, roughly 55 per cent of which is geared for heavy oil. <\/p>\n

Analysts largely viewed Tuesday\u2019s announcement as a positive move for Cenovus. <\/p>\n

National Bank of Canada equity markets said in a research note that the deal was a positive one and would allow Cenovus to focus on its core operated upstream and downstream business and accelerate its debt repayment.<\/p>\n

TD Securities research analyst Menno Hulshof said in a Tuesday note that the move was not a huge surprise, given Cenovus has repeatedly talked about its desire to pare down its U.S. refinery footprint to core assets. <\/p>\n

Selling off its WRB assets means Cenovus is now less exposed to \u201ca historically challenged part of the business,\u201d he wrote. <\/p>\n

Mr. Hulshof also cited Cenovus\u2019s recent bid for MEG Energy Corp. MEG-T<\/a>. <\/p>\n

Late last month, MEG agreed to a friendly deal<\/a> with Cenovus that valued the last of Canada\u2019s large pure-play oil sands producers at nearly $7-billion. <\/p>\n

Analysts had been expecting another bidder to emerge<\/a> since shortly after Strathcona Resources Ltd. SCR-T<\/a> launched its bid in May; Cenovus was specifically named by Royal Bank of Canada analyst Greg Pardy as the most likely suitor.<\/p>\n

That offer made the likelihood of Cenovus selling off its non-core assets \u201cvery topical,\u201d Mr. Hulshof wrote Tuesday. <\/p>\n

Andrew Willis: MEG Energy bidding war sets the stage for oil patch takeovers<\/a><\/p>\n

Cenovus and MEG have neighbouring operations in Northern Alberta. Combining the two companies would create Canada\u2019s second-largest oil sands producer, with an average production of roughly 720,000 barrels a day. That represents more than one out of every five barrels produced in Canada\u2019s oil sands, according to Canada Energy Regulator data.<\/p>\n

\u201cThe fit is exceptional, and it plays right into what we do best,\u201d Cenovus\u2019s Mr. McKenzie said on a conference call discussing the deal last month. \u201cThese assets will be producing for decades to come.\u201d<\/p>\n

Cenovus offered a mix of cash and stock for MEG, worth the equivalent of $27.25 a share and composed of 75-per-cent cash and 25-per-cent stock. The total deal value, including MEG\u2019s existing debt, is $7.9-billion. That equates to $5.2-billion in cash and approximately 84.3 million shares, Cenovus chief financial officer Kam Sandhar said on the call.<\/p>\n

Strathcona has since upped the ante<\/a> in the bidding war for MEG, launching an amended hostile takeover bid on Monday. The all-stock proposal of 0.8 Strathcona shares per MEG share equates to $30.86 a share, or roughly $7.85-billion for the entire company, not including MEG\u2019s debt.<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Cenovus Energy\u2019s president and chief executive said the sale will help \u2018focus\u2019 the…\n","protected":false},"author":2,"featured_media":132379,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[901,888,902,879,877,903,45,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-132378","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-business","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/132378","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=132378"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/132378\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/132379"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=132378"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=132378"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=132378"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}