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Cenovus inks deal to sell northern Alberta oil and gas assets for $625 million

Last Updated Aug 9, 2018 at 6:40 pm EDT

Cenovus logo seen at the company's headquarters in Calgary, Alta., on November 15, 2017. THE CANADIAN PRESS/Jeff McIntosh

CALGARY – Oilsands producer Cenovus Energy Inc. is selling northwestern Alberta oil and gas assets for $625 million as part of a process to reduce its $9.5-billion debt burden.

The sale is to include its Pipestone and Wembley natural gas and liquids production, as well as its 39 per cent interest in the Wembley gas processing plant.

Cenovus didn’t identify the buyer but Calgary-based NuVista Energy Ltd. confirmed it was the purchaser in a separate news release late Thursday.

Cenovus says it is continuing to market other assets in what is known as the Deep Basin region as it tries to pay down debt from its purchase of oilsands and conventional assets from ConocoPhillips last year.

NuVista says the acquired business includes production of about 9,600 barrels of oil equivalent per day and related infrastructure.

It says it will fund the purchase with its credit facilities, a $384-million offering of subscription receipts and a private placement of up to $35 million in common shares issued on a “flow-through” basis.

Companies in this article: (TSX:CVE, TSX:NVA)