Cenovus Energy Inc, the oil sands-focused company spun off from EnCana Corp, is augmenting its main business by investing in prolific light oil prospects in Saskatchewan, an executive said on Thursday.
Cenovus Vice-President Don Swystun said the company is investing in its own lands and acquiring new acreage in the Bakken and Lower Shaunavon unconventional light oil plays in the southern part of the province, something it was unable to do under the EnCana umbrella.
The investments won't match those for developing the company's holdings in Alberta's oil sands, such as the Foster Creek and Christina Lake projects, Swystun said.
"But they will fill in quite nicely some of the gaps when we're bringing on some new tranches of bitumen production," he told an investor conference at Whistler, British Columbia.
Several companies have in recent years capitalized on new drilling and production technology to boost output in the Bakken play, which straddles the Canada-U.S. border.
Similar to shale natural gas operations, companies drill numerous horizontal wells and fracture rock deep
underground to maximize oil output.
Cenovus is currently producing about 1,000 barrels a day from eight wells in Lower Shaunavon, Swystun said. It can likely boost that to 3,000-5,000 bpd, depending on how aggressively it decides to drill, he said.
Cenovus shares were off 27 Canadian cents at C$25.25 on the Toronto Stock Exchange.