* Q1 operating loss of C$0.51 vs. estimates of C$0.40
* Cash flow drops 95 pct, hurt by oil price slide
* Cuts 2016 capital budget by C$300 mln
(Adds CEO comments, financial details, company and industry
background)
By Nia Williams
CALGARY, Alberta, April 27 (Reuters) - Cenovus Energy Inc
CVE.TO said on Wednesday it needs more clarity from the
Canadian government on pipeline and environmental issues before
possibly reactivating oil sands projects that have been deferred
because of the crude price rout.
Speaking on a conference call after Cenovus reported a
first-quarter net loss and slump in cash flow, Chief Executive
Brian Ferguson said he was looking for more than a price signal
before giving the green light to deferred projects.
"The other piece of the equation here that I am watching
carefully is for fiscal and regulatory clarity out of Ottawa. I
expect to see that in the next few months," Ferguson said.
He said areas that needed clarification were discussions
around the pipeline review process by the National Energy Board,
the four working groups looking at climate policy and any
potential changes around income tax rules.
Cenovus has postponed its Narrows Lake oil sands project as
well as further expansions at its Foster Creek and Christina
Lake plants since global crude prices started spiralling
downward in mid-2014.
The Canadian oil industry is pressing hard for new crude
export pipelines to help transport crude from landlocked Alberta
to international markets. In January, however, the Liberal
government introduced new interim rules for environmental
reviews that imposed delays on TransCanada Corp's TRP.TO
Energy East project and Kinder Morgan's KMI.N Trans Mountain
expansion.
Cenovus said total cash flow in the most recent quarter
slumped to C$26 million ($20.7 million), hurt primarily by weak
prices and lower sales volumes.
Operating losses were 51 Canadian cents per share, steeper
than analysts' average estimate of a loss of 40 Canadian cents,
according to Thomson Reuters I/B/E/S.
Cenovus cut its 2016 capital spending budget by C$300
million to C$1.2 billion and reduced crude oil per unit
operating costs by 14 percent to $11.08 a barrel versus the
first quarter of 2015.
The Calgary-based company's net loss narrowed to C$118
million, or 14 Canadian cents per share, from a loss of C$668
million, or 86 Canadian cents per share, a year earlier, mainly
due to foreign-exchange gains of C$403 million.
Crude production fell 9 percent to 197,551 barrels per day,
with conventional oil making up most of the decline.
Oil sands output is expected to grow by around 50,000 bpd
net to Cenovus as new phases of the Christina Lake and Foster
Creek projects in northern Alberta start producing.
($1 = C$1.26)