Cenovus cuts jobs to remain competitive, CEO says as company concludes series of capital investments

Globe and Mail

08-05-2025

Cenovus Energy Inc. CVE-T has cut an undisclosed number of jobs, which chief executive Jon McKenzie said is part of the company's plan to remain competitive as the oil giant wraps up a series of capital investments.
Cenovus would not confirm the number of jobs cut, nor where those workers were located, but said in an email that the changes are 'part of a continued focus on being more competitive across all areas of our business.'
With a number of projects concluding, it said, 'we have reviewed some team structures, which has led to some employees and contractors leaving the company.'
Asked about the job cuts on an earnings call Thursday, Mr. McKenzie said he wouldn't comment on the numbers or locations of job losses out of respect for affected employees.
'As a company, we are getting to the end of an investment cycle in this business, and our capital spending is decreasing,' he said.
'Consistent with that, the amount of work that we have to do is decreasing, and that means we've got to readjust our labor force to make it fit for purpose and ensure that we are competitive.'
Projects close to completion include the West White Rose extension off the coast of St. John's, NL, and, in Northern Alberta, the construction of a 17-km pipeline from the company's Narrows Lake lease to its Christina Lake processing facility, and improvements at its Foster Creek oil sands site.
At least 50 people lost their jobs at a single location in Alberta - the minimum number to trigger mandatory notice to the provincial government.
Alberta Jobs Minister Matt Jones confirmed the job losses in an emailed statement, adding it is challenging every time Albertans lose their jobs.
'Cenovus has indicated that severance, extended benefits, and career counselling services are being provided to support impacted qualifying employees,' Mr. Jones said.
The job losses come as the company on Thursday posted a fall in its first-quarter profit, but beat analyst cash flow expectations largely driven by stronger-than-expected oil sands earnings and higher prices.
Upstream production hit 818,900 barrels a day, maintaining a near-record performance and exceeding the previous quarter, the company said. Total production for the quarter was about 1 per cent higher than analysts expected.
Cenovus also announced an 11 per cent increase to its base dividend, to $0.80 per share.
Mr. McKenzie said a large drop in capital spending over the next year will be due to the completion of the West White Rose project.
The White Rose field sits around 350 kilometres east of St. John's. It produces roughly 26,000 barrels a day, but that number is falling as its oil reserves decline. The extension project will add about 75,000 barrels a day to production and extend the life of the field to 2038.
Cenovus floated a massive gravity-based structure for the project on Wednesday night, Mr. McKenzie said, and will tow it to the field in June. After a few months of commissioning and startup work, the company will start drilling, with first production expected in the second quarter of 2026.
'This is becoming very real, very, very quickly,' he said.
Cenvous' capital spend will begin to come down in the forth quarter of 2025 as other projects move to the commissioning and startup phases, Mr. McKenzie said.
'We have high confidence that we are going to be decreasing our capital budget from the 5 billion that we've been running in to a lower number in 2026,' he said.
'We've spent the last three years focusing on the growth plan. This year, we've got about 1.4 to 1.8 billion of growth spent, and that growth, really in earnest, starts to show up this year and going through into 2027.'