Through the split of Encana Corporation, Cenovus Energy was developed in 2009 as an independent oil company in Canada. They mainly focus on increasing oil production by taking strategic measures in developing plans and relying on technology. Cenovus also focuses on meeting consumer’s needs by providing untapped oil. This untapped oil is extracted from the earth’s mantel and has never been touched before providing only the best quality. Technology is also very important to Cenovus because it helps with the reduction of water, steam, natural gas, and electricity making oil extraction more efficient and less harmful. Technology also helps with production, making extraction an easier process.
In the north of Bonnyville, Cenovus Energy is developing a three-phase two billion dollar expansion plan. This plan not only benefits the company’s goals in production, but also it offers 1,000 jobs for the public. The first phase is already under construction, and is expected to operate during 2014. The other two phases are anticipated to operate between 2016 and 2019. The purpose of this three-step plan is to increase production by supplying more oil to consumers. The first phase of the plant is estimated to supply 210,000 barrels of oil per day as opposed to the 100,000 barrels per day offered in the original plant. The next two phases will raise the amount of oil extracted by bringing in 235,000 barrels. After the phases are complete, Cenovus expects to reduce their prices and also reduce the amount of energy put into extracting the oil for their consumers.
Now that this new company has emerged into the Energy industry with a comprehensive expansion plan, it presents a challenge for other Energy companies. The challenge is that now these companies have to figure out a way to increase their oil production. If Cenovus is producing and supplying more oil, their consumer rates will increase and other Energy companies will lose consumers. As a result, companies are challenged with finding a way to provide more oil or come up with another invention that will win back their customers.
http://www.vancouversun.com/business/oilsands+expansion+approved/3551215/story.html
http://www.cenovus.com/operations/index.html
It is encouraging to see that a new company can break into an industry with such a high starting cost. I suppose that the same resourcefulness and ingenuity used to create the new plant were also used to get this company off of the ground.
ReplyDeleteI wonder if Cenovus will join a cartel, like OPEC, to ensure it has a firm footing in the marketplace. But, as Mariana pointed out, oil companies must adjust to this new player. It will be interesting to see how they will start to produce and supply more oil. And, if they do, prices for gas will inevitably fall even more due to increased supply.