CENOVUS ENERGY INC.
For the period ended Dec 31, 2023. Filed Feb 15, 2024.
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The yearly report of certain Canadian companies, filed under a joint US and Canadian system. It is the main yearly account these companies give US investors, largely as filed in Canada.
FY2023 · Filed Feb 15, 2024
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Contents
EX-99.3 · 38. COMMITMENTS AND CONTINGENCIES
38. COMMITMENTS AND CONTINGENCIES
A) Commitments
Cenovus has entered into various commitments in the normal course of operations. Commitments that have original maturities less than one year are excluded from the table below. Future payments for the Company’s commitments are below:
| As at December 31, 2023 | 1 Year | 2 Years | 3 Years | 4 Years | 5 Years | Thereafter | Total |
|---|---|---|---|---|---|---|---|
| Transportation and Storage (1) (2) | 2,018 | 1,927 | 1,680 | 1,663 | 1,641 | 15,738 | 24,667 |
| Product Purchases | 617 | — | — | — | — | — | 617 |
| Real Estate | 57 | 57 | 59 | 63 | 58 | 604 | 898 |
| Obligation to Fund HCML | 94 | 94 | 94 | 89 | 52 | 90 | 513 |
| Other Long-Term Commitments (3) | 417 | 194 | 184 | 175 | 166 | 965 | 2,101 |
| Total Commitments | 3,203 | 2,272 | 2,017 | 1,990 | 1,917 | 17,397 | 28,796 |
| As at December 31, 2022 | 1 Year | 2 Years | 3 Years | 4 Years | 5 Years | Thereafter | Total |
|---|---|---|---|---|---|---|---|
| Transportation and Storage (1) (2) | 1,747 | 2,011 | 1,542 | 1,416 | 1,360 | 13,005 | 21,081 |
| Product Purchases | 1,626 | 1,509 | 922 | 922 | 922 | 3,457 | 9,358 |
| Real Estate | 48 | 50 | 50 | 50 | 54 | 604 | 856 |
| Obligation to Fund HCML | 92 | 105 | 96 | 96 | 91 | 143 | 623 |
| Other Long-Term Commitments | 381 | 90 | 75 | 74 | 65 | 395 | 1,080 |
| Total Commitments | 3,894 | 3,765 | 2,685 | 2,558 | 2,492 | 17,604 | 32,998 |
(1)Includes transportation commitments that are subject to regulatory approval or were approved, but are not yet in service of $13.0 billion (December 31, 2022 – $9.1 billion). Terms are up to 20 years on commencement. Estimated tolls are subject to change pending review by the Canada Energy Regulator.
(2)As at December 31, 2023, includes $2.1 billion related to long-term transportation and storage commitments with HMLP (December 31, 2022 – $2.2 billion).
(3)The Company acquired $538 million of commitments as part of the Toledo Acquisition on February 28, 2023.
There were outstanding letters of credit aggregating to $364 million (December 31, 2022 – $490 million) issued as security for financial and performance conditions under certain contracts. Subsequent to December 31, 2023, Cenovus entered into a new transportation commitment for $587 million.
B) Contingencies
Legal Proceedings
Cenovus is involved in a limited number of legal claims associated with the normal course of operations. Cenovus believes that any liabilities that might arise from such matters, to the extent not provided for, are not likely to have a material effect on its Consolidated Financial Statements.
Income Tax Matters
The tax regulations and legislation and interpretations thereof in the various jurisdictions in which Cenovus operates are continually changing. As a result, there are usually a number of tax matters under review. Management believes that the provision for taxes is adequate.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.