Cenovus Energy Inc., including its subsidiaries, (together “Cenovus” or the “Company”) is an integrated energy company with crude oil and natural gas production operations in Canada and the Asia Pacific region, and upgrading, refining and marketing operations in Canada and the United States (“U.S.”). On January 1, 2021, Cenovus and Husky Energy Inc. (“Husky”) closed a transaction to combine the two companies through a plan of arrangement (the “Arrangement”) (see Note 5C). The transaction included Husky's upstream assets, extensive transportation, storage and logistics and downstream infrastructure. Comparative figures include Cenovus's results prior to the closing of the Arrangement on January 1, 2021, and do not reflect any historical data from Husky.

Cenovus is incorporated under the Canada Business Corporations Act and its common shares and common share purchase warrants are listed on the Toronto Stock Exchange (“TSX”) and New York Stock Exchange. Cenovus’s cumulative redeemable preferred shares series 1, 2, 3, 5 and 7 are listed on the TSX. The executive and registered office is located at 4100, 225 6 Avenue S.W., Calgary, Alberta, Canada, T2P 1N2. Information on the Company’s basis of preparation for these Consolidated Financial Statements is found in Note 2.

Management has determined the operating segments based on information regularly reviewed for the purposes of decision making, allocating resources and assessing operational performance by Cenovus’s chief operating decision maker. The Company’s operating segments are aggregated based on their geographic locations, the nature of the businesses or a combination of these factors. The Company evaluates the financial performance of its operating segments primarily based on operating margin.

In September 2022, the Company completed the divestiture of the majority of the retail fuels business. As a result, Management elected to aggregate the remaining commercial fuels business and the historical retail fuels business into the Canadian Manufacturing segment. The marketing operations of the Canadian Manufacturing segment have similar products and services, customer types, distribution methods and operate in the same regulatory environment as the commercial fuels business. The commercial fuels business includes cardlock, bulk plant and travel centre locations across Canada. Comparative periods have been re-presented to reflect this change (see Note 3X).

•Oil Sands, includes the development and production of bitumen and heavy oil in northern Alberta and Saskatchewan. Cenovus’s oil sands assets include Foster Creek, Christina Lake, Sunrise, Lloydminster thermal and Lloydminster conventional heavy oil assets. Cenovus jointly owns and operates pipeline gathering systems and terminals through the equity-accounted investment in Husky Midstream Limited Partnership (“HMLP”). The sale and transportation of Cenovus’s production and third-party commodity trading volumes are managed and marketed through access to capacity on third-party pipelines and storage facilities in both Canada and the U.S. to optimize product mix, delivery points, transportation commitments and customer diversification.

•Conventional, includes assets rich in natural gas liquids (“NGLs”) and natural gas within the Elmworth-Wapiti, Kaybob‑Edson, Clearwater and Rainbow Lake operating areas in Alberta and British Columbia and interests in numerous natural gas processing facilities. Cenovus’s NGLs and natural gas production is marketed and transported, with additional third-party commodity trading volumes, through access to capacity on third-party pipelines, export terminals and storage facilities. These provide flexibility for market access to optimize product mix, delivery points, transportation commitments and customer diversification.

•Canadian Manufacturing, includes the owned and operated Lloydminster upgrading and asphalt refining complex, which converts heavy oil and bitumen into synthetic crude oil, diesel, asphalt and other ancillary products. Cenovus also owns and operates the Bruderheim crude-by-rail terminal and two ethanol plants. The Company’s commercial fuels business across Canada is included in this segment. Cenovus markets its production and third-party commodity trading volumes in an effort to use its integrated network of assets to maximize value.

•U.S. Manufacturing, includes the refining of crude oil to produce gasoline, diesel, jet fuel, asphalt and other products at the wholly-owned Lima Refinery and Superior Refinery, the jointly-owned Wood River and Borger refineries (jointly owned with operator Phillips 66) and the jointly-owned Toledo Refinery (jointly owned with operator BP Products North America Inc. (“BP”)). Cenovus also markets some of its own and third-party volumes of refined petroleum products including gasoline, diesel and jet fuel.

Corporate and Eliminations, includes Cenovus-wide costs for general and administrative, financing activities, gains and losses on risk management for corporate related derivative instruments and foreign exchange. Eliminations include adjustments for internal usage of natural gas production between segments, transloading services provided to the Oil Sands segment by the Company’s crude-by-rail terminal, crude oil production used as feedstock by the Canadian Manufacturing and U.S. Manufacturing segments, the sale of condensate extracted from blended crude oil production in the Canadian Manufacturing segment and sold to the Oil Sands segment, and unrealized profits in inventory. Eliminations are recorded based on current market prices.


	Upstream
For the years ended December 31,	Oil Sands		Conventional		Offshore		Total
	2022	2021 (1)		2020		2022		2021	2020	2022	2021	2020	2022	2021 (1)	2020
Revenues
Gross Sales	34,775	22,827		8,804		4,332		3,235	904	2,020	1,782	—	41,127	27,844	9,708
Less: Royalties	4,493	2,196		331		298		150	40	77	108	—	4,868	2,454	371
	30,282	20,631		8,473		4,034		3,085	864	1,943	1,674	—	36,259	25,390	9,337
Expenses
Purchased Product	4,810	2,404		1,262		2,023		1,655	268	—	—	—	6,833	4,059	1,530
Transportation and Blending	12,036	8,625		4,683		143		74	81	15	15	—	12,194	8,714	4,764
Operating	2,930	2,451		1,156		541		551	320	318	239	—	3,789	3,241	1,476
Realized (Gain) Loss on Risk Management	1,527	786		268		92		2	—	—	—	—	1,619	788	268
Operating Margin	8,979	6,365		1,104		1,235		803	195	1,610	1,420	—	11,824	8,588	1,299
Unrealized (Gain) Loss on Risk Management	(68)	18		57		13		1	—	—	—	—	(55)	19	57
Depreciation, Depletion and Amortization	2,763	2,666		1,687		370		3	880	585	492	—	3,718	3,161	2,567
Exploration Expense	9	16		9		1		(3)	82	91	5	—	101	18	91
(Income) Loss From Equity- Accounted Affiliates	8	(5)		—		—		—	—	(23)	(47)	—	(15)	(52)	—
Segment Income (Loss)	6,267	3,670		(649)		851		802	(767)	957	970	—	8,075	5,442	(1,416)


	Downstream
	Canadian Manufacturing		U.S. Manufacturing		Total
For the years ended December 31,	2022	2021 (1)	2020	2022	2021	2020	2022	2021 (1)	2020
Revenues
Gross Sales	7,792	6,215	82	30,310	20,043	4,733	38,102	26,258	4,815
Less: Royalties	—	—	—	—	—	—	—	—	—
	7,792	6,215	82	30,310	20,043	4,733	38,102	26,258	4,815
Expenses
Purchased Product	6,389	5,156	—	26,112	17,955	4,429	32,501	23,111	4,429
Transportation and Blending	—	—	—	—	—	—	—	—	—
Operating	704	486	37	2,346	1,772	748	3,050	2,258	785
Realized (Gain) Loss on Risk Management	—	—	—	112	104	(21)	112	104	(21)
Operating Margin	699	573	45	1,740	212	(423)	2,439	785	(378)
Unrealized (Gain) Loss on Risk Management	—	—	—	18	1	(1)	18	1	(1)
Depreciation, Depletion and Amortization	208	226	8	640	2,381	728	848	2,607	736
Exploration Expense	—	—	—	—	—	—	—	—	—
(Income) Loss From Equity-Accounted Affiliates	—	—	—	—	—		—	—	—
Segment Income (Loss)	491	347	37	1,082	(2,170)	(1,150)	1,573	(1,823)	(1,113)


	Corporate and Eliminations		Consolidated
For the years ended December 31,	2022	2021 (1) (2)	2020	2022	2021 (1) (2)	2020
Revenues
Gross Sales	(7,464)	(5,291)	(609)	71,765	48,811	13,914
Less: Royalties	—	—	—	4,868	2,454	371
	(7,464)	(5,291)	(609)	66,897	46,357	13,543
Expenses
Purchased Product	(5,533)	(3,844)	(278)	33,801	23,326	5,681
Transportation and Blending	(664)	(676)	(36)	11,530	8,038	4,728
Operating	(1,270)	(783)	(306)	5,569	4,716	1,955
Realized (Gain) Loss on Risk Management	31	101	5	1,762	993	252
Unrealized (Gain) Loss on Risk Management	(89)	(18)	—	(126)	2	56
Depreciation, Depletion and Amortization	113	118	161	4,679	5,886	3,464
Exploration Expense	—	—	—	101	18	91
(Income) Loss From Equity-Accounted Affiliates	—	(5)	—	(15)	(57)	—
Segment Income (Loss)	(52)	(184)	(155)	9,596	3,435	(2,684)
General and Administrative	865	849	292	865	849	292
Finance Costs	820	1,082	536	820	1,082	536
Interest Income	(81)	(23)	(9)	(81)	(23)	(9)
Integration and Transaction Costs	106	349	29	106	349	29
Foreign Exchange (Gain) Loss, Net	343	(174)	(181)	343	(174)	(181)
Revaluation (Gains)	(549)	—	—	(549)	—	—
Re-measurement of Contingent Payment	162	575	(80)	162	575	(80)
(Gain) Loss on Divestiture of Assets	(269)	(229)	(81)	(269)	(229)	(81)
Other (Income) Loss, Net	(532)	(309)	40	(532)	(309)	40
	865	2,120	546	865	2,120	546
Earnings (Loss) Before Income Tax				8,731	1,315	(3,230)
Income Tax Expense (Recovery)				2,281	728	(851)
Net Earnings (Loss)				6,450	587	(2,379)



For the years ended December 31,	2022	2021	2020
Upstream
Crude Oil (1)	29,834	19,877	8,017
NGLs (1)	2,346	1,983	727
Natural Gas	3,690	3,032	535
Other	389	498	58
Downstream
Canadian Manufacturing
Synthetic Crude Oil	2,360	1,951	—

Asphalt	620	477	—
Other Products and Services (2)	4,812	3,787	82
U.S. Manufacturing
Gasoline	14,116	10,111	2,352
Diesel and Distillate	11,453	6,429	1,569
Other Products	4,741	3,503	812

Corporate and Eliminations (2)	(7,464)	(5,291)	(609)
Consolidated	66,897	46,357	13,543

In connection with the marketing and sale of Cenovus’s own and purchased crude oil, NGLs, natural gas and refined products for the year ended December 31, 2022, Cenovus had two customers (2021 – two; 2020 – three) that individually accounted for more than 10 percent of its consolidated gross sales. Sales to these customers, recognized as major international energy companies with investment grade credit ratings, were approximately $16.1 billion and $9.1 billion, respectively (2021 – $8.5 billion and $6.8 billion; 2020 – $4.3 billion, $1.8 billion and $1.5 billion, respectively), and are reported across all of the Company’s operating segments.


	E&E Assets		PP&E		ROU Assets
As at December 31,	2022	2021	2022	2021	2022	2021
Oil Sands	674	653	24,657	22,535	638	754
Conventional	6	6	2,020	2,174	2	2
Offshore	5	61	2,549	2,822	152	160
Canadian Manufacturing (1)	—	—	2,466	2,558	252	388
U.S. Manufacturing	—	—	4,482	3,745	329	252
Corporate and Eliminations	—	—	325	391	472	454
Consolidated	685	720	36,499	34,225	1,845	2,010



	Goodwill		Total Assets
As at December 31,	2022	2021	2022	2021 (2)
Oil Sands	2,923	3,473	32,248	31,070
Conventional	—	—	2,410	3,026
Offshore	—	—	3,339	3,597
Canadian Manufacturing (1)	—	—	3,172	3,884
U.S. Manufacturing (3)	—	—	8,324	7,509
Corporate and Eliminations (3)	—	—	6,376	5,018
Consolidated	2,923	3,473	55,869	54,104



For the years ended December 31,	2022	2021	2020
Capital Investment
Oil Sands	1,792	1,019	427
Conventional	344	222	78
Offshore
Asia Pacific	8	21	—
Atlantic	302	154	—
Total Upstream	2,446	1,416	505

Canadian Manufacturing (2)	117	68	33
U.S. Manufacturing	1,059	995	243
Total Downstream	1,176	1,063	276

Corporate and Eliminations	86	84	60
	3,708	2,563	841






Acquisitions (Note 5)
Oil Sands (3)	1,609	5,005	6
Conventional	12	551	12
Offshore (4)	—	3,129	—
Canadian Manufacturing (2)	—	2,973	—
U.S. Manufacturing	—	1,618	—
Corporate and Eliminations	—	156	—
	1,621	13,432	18

Total Capital Expenditures	5,329	15,995	859

(3)Cenovus was deemed to have disposed of its pre-existing interest in Sunrise Oil Sands Partnership (“SOSP”) and reacquired it at fair value as required by International Financial Reporting Standard 3, “Business Combinations” (“IFRS 3”). The acquisition capital above does not include the fair value of the pre-existing interest in SOSP of $1.6 billion.