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Risk Management (Tables)
 12 Months Ended
Dec. 31, 2020
Risk Management [Abstract]  
Net Fair Value of Risk Management Positions

Net Fair Value of Risk Management Positions

As at December 31, 2020

Notional 

Volumes (1) (2)

 

Terms (3)

 

Weighted Average Price (1) (2)

 

Fair Value Asset (Liability)

 

Crude Oil and Condensate Contracts

 

 

 

 

 

 

 

 

 

 

 

 

WTI Fixed - Sell

19.6 MMbbls

 

 

January 2021 - June 2022

 

 

US$43.99/bbl

 

 

 

(113

)

WTI Fixed - Buy

11.7 MMbbls

 

 

February 2021 - June 2022

 

 

US$44.55/bbl

 

 

 

59

 

Other Financial Positions (4)

 

 

 

 

 

 

 

 

 

 

1

 

Total Fair Value

 

 

 

 

 

 

 

 

 

 

(53

)

(1)

Million barrels (“MMbbls”). Barrel (“bbl”).

(2)

Notional volumes and weighted average price represent various contracts over the respective terms. The notional volumes and weighted average price may fluctuate from month to month as it represents the averages for various individual contracts with different terms.

(3)

Contract terms represents averages for various individual contracts with different terms and range from one to twenty-three months.

(4)

Other financial positions consist of risk management positions related to WCS and condensate differential contracts, Belvieu and natural gas fixed contracts and the Company’s Refining and Marketing segment.
Disclosure of Derivative Financial Instruments [Line Items]  
Summary of Changes in Inputs to Option Pricing Model, Resulted in Unrealized Gains (Losses) Impacting Earnings Before Income Tax Changes in the following inputs to the option pricing model, with fluctuations in all other variables held constant, could have resulted in an unrealized gain (loss) impacting earnings before income tax as follows:

As at December 31, 2020

Sensitivity Range

 

Increase

 

 

Decrease

 

WCS Forward Prices

± $5.00 per barrel

 

 

(41

)

 

 

32

 

WTI Option Volatility

± five percent

 

 

(18

)

 

 

17

 

Canadian to U.S. Dollar Foreign Exchange Rate Option Volatility

± five percent

 

 

7

 

 

 

(10

)

 

 

 

 

 

 

 

 

 

 

As at December 31, 2019

Sensitivity Range

 

Increase

 

 

Decrease

 

WCS Forward Prices

± $5.00 per barrel

 

 

(129

)

 

 

80

 

WTI Option Volatility

± five percent

 

 

(45

)

 

 

42

 

Canadian to U.S. Dollar Foreign Exchange Rate Option Volatility

± five percent

 

 

10

 

 

 

(19

)

 
Undiscounted Cash Outflows Relating to Financial Liabilities

Undiscounted cash outflows relating to financial liabilities are:

As at December 31, 2020

Less than 1 Year

 

 

Years 2 and 3

 

 

Years 4 and 5

 

 

Thereafter

 

 

Total

 

Accounts Payable and Accrued Liabilities

 

2,018

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,018

 

Short-Term Borrowings (1)

 

121

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

121

 

Long-Term Debt (1)

 

385

 

 

 

1,965

 

 

 

1,966

 

 

 

8,627

 

 

 

12,943

 

Contingent Payment (2)

 

36

 

 

 

28

 

 

 

-

 

 

 

-

 

 

 

64

 

Lease Liabilities (1)

 

254

 

 

 

445

 

 

 

365

 

 

 

1,412

 

 

 

2,476

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at December 31, 2019

Less than 1 Year

 

 

Years 2 and 3

 

 

Years 4 and 5

 

 

Thereafter

 

 

Total

 

Accounts Payable and Accrued Liabilities

 

2,229

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,229

 

Long-Term Debt (1)

 

344

 

 

 

1,338

 

 

 

1,465

 

 

 

9,326

 

 

 

12,473

 

Contingent Payment (2)

 

79

 

 

 

69

 

 

 

-

 

 

 

-

 

 

 

148

 

Lease Liabilities (1)

 

277

 

 

 

466

 

 

 

410

 

 

 

1,544

 

 

 

2,697

 

(1)

Principal and interest, including current portion.

(2)

Refer to Note 35C for fair value assumptions.


Commodity Price Risk [Member]  
Disclosure of Derivative Financial Instruments [Line Items]  
Summary of Changes in Inputs to Option Pricing Model, Resulted in Unrealized Gains (Losses) Impacting Earnings Before Income Tax

The following table summarizes the sensitivity of the fair value of Cenovus’s risk management positions to independent fluctuations in commodity prices, with all other variables held constant. Management believes the fluctuations identified in the table below are a reasonable measure of volatility.

The impact of fluctuating commodity prices on the Company’s open risk management positions could have resulted in unrealized gains (losses) impacting earnings before income tax as follows:

As at December 31, 2020

Sensitivity Range

Increase

 

 

Decrease

 

Crude Oil Commodity Price

± US$5.00 per bbl Applied to WTI and Condensate Hedges

 

(44

)

 

 

44

 

Crude Oil Differential Price

± US$2.50 per bbl Applied to Differential Hedges Tied to Production

 

(2

)

 

 

2

 

 

 

 

 

 

 

 

 

 

As at December 31, 2019

Sensitivity Range

Increase

 

 

Decrease

 

Crude Oil Commodity Price

± US$5.00 per bbl Applied to WTI and Condensate Hedges

 

3

 

 

 

(3

)

Crude Oil Differential Price

± US$2.50 per bbl Applied to Differential Hedges Tied to Production

 

5

 

 

 

(5

)

 
Currency risk [Member]  
Disclosure of Derivative Financial Instruments [Line Items]  
Summary of Changes in Inputs to Option Pricing Model, Resulted in Unrealized Gains (Losses) Impacting Earnings Before Income Tax In respect of these financial instruments, the impact of changes in the Canadian per U.S. dollar exchange rate would have resulted in a change to the foreign exchange (gain) loss as follows:

For the years ended December 31,

2020

 

 

2019

 

$0.05 Increase in the Canadian per U.S. Dollar Foreign Exchange Rate

 

300

 

 

 

250

 

$0.05 Decrease in the Canadian per U.S. Dollar Foreign Exchange Rate

 

(300

)

 

 

(250

)