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Joint Arrangements and Associate | 9 Months Ended
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Sep. 30, 2021
Subclassifications of assets, liabilities and equities [abstract] |
JOINT ARRANGEMENTS AND ASSOCIATE |
15. JOINT ARRANGEMENTS AND ASSOCIATE
A) Joint Operations BP-Husky Refining LLC Cenovus holds a 50 percent interest in Toledo with BP, who holds the remaining interest and operates the Toledo Refinery in Ohio. Sunrise Oil Sands Partnership Cenovus, as the operator, holds a 50 percent interest in Sunrise, an oil sands project in northern Alberta, with BP Canada. WRB Refining LP Cenovus holds a 50 percent interest in WRB with Phillips 66, who holds the remaining interest and operates the Wood River Refinery in Illinois and the Borger Refinery in Texas. B) Joint Ventures Husky-CNOOC Madura Ltd. The Company holds a 40 percent interest in the jointly controlled entity, HCML, which is engaged in the exploration for and production of natural gas resources in offshore Indonesia. The Company’s share of equity investment income (loss) related to the joint venture is included in the Consolidated Statements of Earnings (Loss) in the Offshore segment. Summarized below is the financial information for HCML accounted for using the equity method. Results of Operations
For the periods ended September 30, 2021 | Three Months Ended |  |  | Nine Months Ended |
Revenue |  | 119 |  |  |  | 348 |
Expenses |  | 75 |  |  |  | 330 |
Net Earnings (Loss) |  | 44 |  |  |  | 18 |
Balance Sheet
As at | September 30, 2021 |
Current Assets (1) |  | 213 |
Non-Current Assets |  | 1,464 |
Current Liabilities |  | 71 |
Non-Current Liabilities |  | 988 |
Net Assets |  | 618 |
(1)Includes cash and cash equivalents of $56 million. For the nine months ended September 30, 2021, the Company’s share of income from the equity-accounted affiliate was $36 million. As at September 30, 2021, the carrying amount of the Company’s share of net assets was $404 million. These amounts do not equal the 40 percent joint control of the revenues, expenses and net assets of HCML due to differences in the values attributed to the investment and accounting policies between the joint venture and the Company. For the nine months ended September 30, 2021, the Company received $78 million of distributions from HCML. Husky Midstream Limited Partnership The Company holds a 35 percent interest in HMLP, which owns midstream assets, including pipeline, storage and other ancillary infrastructure assets in Alberta and Saskatchewan. Power Assets Holdings Ltd. holds a 49 percent interest and CK Infrastructure Holdings Ltd. holds a 16 percent interest in HMLP. For the nine months ended September 30, 2021, HMLP had net earnings of $74 million. The Company’s share of income (loss) from the equity-accounted affiliate does not equal the 35 percent of the net earnings of HMLP due to the nature of the profit-sharing arrangement as defined in the partnership agreement. The Company’s share of earnings will fluctuate depending on certain income thresholds. For the nine months ended September 30, 2021, the Company did not record its pre-tax net loss relating to HMLP of $21 million as the carrying value of the Company’s interest is $nil. Due to the decline in forecasted distributions from the partnership profit structure, as at September 30, 2021, the Company had $12 million in cumulative unrecognized losses and OCI, net of tax. The Company records its share of equity investment income related to the joint venture only in excess of the cumulated unrecognized loss and is included in the Consolidated Statements of Earnings (Loss) in the Oil Sands segment. For the nine months ended September 30, 2021, the Company received $37 million in distributions from HMLP. For the nine months ended September 30, 2021, the Company recorded $5 million in income from equity-accounted affiliates related to HMLP’s distributions, net of the Company’s contributions to HMLP. C) Associate Headwater Exploration Inc. The Company holds a 25 percent interest in Headwater Exploration Inc. (“Headwater”), a publicly traded exploration and production company, which is engaged in the development of the Marten Hills assets in northern Alberta. The Company’s share of equity investment income (loss) related to the associate is included in the Consolidated Statements of Earnings (Loss) in the Corporate and Eliminations segment. Summarized below is the financial information for Headwater accounted for using the equity method.
For the periods ended September 30, 2021 | Three Months Ended |  |  | Nine Months Ended |
Net Earnings (Loss) (1) |  | 5 |  |  |  | (2) |
Share of Equity Investment |  | 25 | % |  |  |  | 25 | % |
Proportionate Share of Equity Investment |  | 1 |  |  |  | (1) |
(1)Represents the three and nine month periods based on the prior quarter's release of results due to the timing of reporting dates. As at September 30, 2021, the $96 million carrying value of the Company's investment was reclassified to current assets. On October 14, 2021, the Company sold all of its common shares of Headwater for gross proceeds of $228 million. The Company continues to hold 15 million warrants in Headwater in other assets (see Note 16).

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