OH, CANADA: Oil Sands Pipeline Shortage Takes Toll as Cenovus Cuts Output.
The Calgary-based producer said its Christina Lake and Foster Creek complexes have operated at reduced levels since February, in a statement released Thursday. Cenovus shares slipped as much as 6.1 percent in Toronto and fellow oil sands leaders Suncor Energy Inc. and Canadian Natural Resources Ltd. fell as well.
Heavy Canadian crude prices have been trading near the biggest discount to U.S. benchmark oil futures in more than four years as new oil sands production has come on line and the Keystone pipeline has cut shipments after a spill in November. Other pipelines are full and exporters shipping crude via rail have faced bottlenecks amid a backlog of grain shipments.
“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,” Chief Executive Officer Alexander Pourbaix said in the statement. The bottlenecks “clearly demonstrate the urgent need for approved pipeline projects in Canada to proceed as soon as possible.”