Cenovus pumps the brakes on plans to sell off Husky gas stations
Merger plans called for selling off of stations, but low prices prompt a rethink for now
The CEO of Cenovus Energy Inc. says a pending sale of Husky Energy Inc.'s chain of retail fuel stations was halted as part of the $3.8-billion all-stock takeover that closed early this year.
In a fireside chat at the 2021 Scotiabank CAPP Energy Symposium, Alex Pourbaix says the sale would have taken place at a low point in the fuel retailing cycle and was stopped in hopes that the market for those assets would improve.
Husky announced its plan to get out of retailing fuel to consumers after 80 years in the business in early 2019, putting on the block more than 500 service stations, travel centres, cardlock operations and bulk distribution facilities from British Columbia to New Brunswick.
It struck a deal to sell its 12,000-barrel-per-day refinery in Prince George, B.C., in late 2019 but couldn't find a buyer for the rest of the assets.
Higher oil prices will allow Cenovus to reach its debt reduction target of $10 billion by year-end, removing the need to sell assets, but Pourbaix said the company is continuing to sort its operations into core and non-core buckets.
He says Husky's Asian-Pacific assets are also being assessed and are "not necessarily" going to be considered a core asset going forward. Husky has offshore natural gas projects with Chinese partner CNOOC Ltd. in China and Indonesia.