(Reuters) - Canadian oil and gas producer Cenovus Energy Inc (CVE.TO) reported a better-than-expected operating profit, helped by a 48 percent jump in production at its Christina Lake oil sands project in northern Alberta.
The Calgary-based energy company, which owns Christina Lake with ConocoPhillips (COP.N) and operates it, said production at the project rose to an average of 65,738 net barrels per day.
Cenovus also co-owns Foster Creek, where production dropped 2 percent. It is developing a third project as part of its joint venture with ConocoPhillips.
The company said its cash flow - a key indicator of its ability to fund new projects - fell 4 percent to about C$1.2 billion, hurt by “significantly lower” refining margins.
It holds 50 percent stakes in two U.S. refineries owned by Phillips 66 (PSX.N) and Cenovus’ refining margins have taken a hit in the past few quarters, hurt by the narrowing price difference between crude oil and the petroleum products extracted from it.
The company’s profit jumped to C$247 million ($225.25 million), or 33 Canadian cents per share, in the quarter ended March 31, from C$171 million, or 23 Canadian cents per share, a year earlier.
Operating profit, which excludes most one-time items, fell to C$378 million, or 50 Canadian cents per share, from C$391 million, or 52 Canadian cents per share, a year earlier.
This beat the average analyst estimate of 48 Canadian cents per share, according to Thomson Reuters I/B/E/S.
Total oilsands production rose 20 percent to an average of 120,444 bpd.
Cenovus shares closed at C$33.02 on Tuesday on the Toronto Stock Exchange. The shares have risen 10 percent over the past 12 months.
($1 = 1.0966 Canadian Dollars)
Reporting by Sayantani Ghosh in Bangalore and Scott Haggett in Calgary; Editing by Don Sebastian