Good morning, ladies and gentlemen. Thank you for standing by, and welcome to Cenovus Energy’s First Quarter 2025 Results Conference Call. At this time all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. As a reminder, this call is being recorded. I would now like to turn the meeting over to Mr. Patrick Read, Vice President, Investor Relations and Internal Audit. Please go ahead, Mr. Read.

Thank you, operator. Good morning, everyone, and welcome to Cenovus’ 2025 first quarter results conference call. On the call this morning are CEO, Jon McKenzie; and CFO, Kam Sandhar, who will take you through our results. Then we’ll open the line for Jon, Kam, and other members of the Cenovus management team to take your questions. Before getting started, I’ll refer you to our advisories located at the end of today’s news release. These describe the forward-looking information, non-GAAP measures, and oil and gas terms referred to today. They also outline the risk factors and assumptions relevant to this discussion. Additional information is available on Cenovus’ annual MD&A and our most recent AIF and Form 40-F. And as a reminder, all figures we referenced on the call today will be in Canadian dollars unless otherwise noted. You can view our results at cenovus.com. For the question-and-answer portion of the call, please keep to one question with a maximum of one follow-up. You’re welcome to rejoin the queue for any other follow-up questions you may have. We also ask that you hold off on any detailed modeling questions. You can follow up on those directly with our Investor Relations team after the call. I will now turn the call over to Jon. Jon, please go ahead.

Great. Thank you, Patrick. Good morning, everybody. Just before we get started on our first quarter performance, I’d like to take a moment to recognize some of our great people, who have accomplished great things while also ensuring we do it the right way, protecting our people and our assets. For example, on West White Rose, we have now worked over 27 million hours with a total recordable incident frequency of 0.18. This is exceptional performance by any measure and a clear example of how we’ll continue to ensure that all of our workers return home safely each and every day. As another example of our safety programs and work, we’ve instituted a program on dropped object prevention across our company. This program focuses on planning, hard barriers, and work controls to reduce the risk of dropped objects. We have seen the impacts of this program and how our work is performed, mitigating risks across our business through the commitment and dedication of our people in the field. At Cenovus, occupational and process safety is ingrained in our culture and our values. So now turning to our results. Our focus in 2025 is on flawlessly operating the base business, building momentum in the downstream, delivering on our growth projects, and maintaining our focus on cost structure. Upstream production in the quarter was 819,000 BOE per day, highlighted by yet another impressive result from our oil sands business. At Christina Lake, production was 238,000 barrels per day, and we have completed the Narrows Lake project, which connects to the Christina Lake plant, and are now running steam through a tieback pipeline and injecting steam into the first two well pads. First oil from Narrows Lake is expected early in the third quarter as planned. With first production on the way, let me take a moment to talk about what makes this project so special and unique. What we’ve done at Narrows Lake is a real feat of engineering, and I’m incredibly proud of the technical and operations staff who have made this possible. At 17 kilometers long, the Narrows Lake tieback is the longest steamline ever started up in the oil sands industry. It allows us to access some of the best reservoir in the basin at a fraction of the cost of building a new plant. Over their producing lives, these first well pads at Narrows are expected to have cumulative steam oil ratios well below two, and the best wells are expected to produce at peak rates of over 3,000 barrels per day. These are some of the longest and most productive wells in our industry, showcasing our technical and operating capability. We have now drilled the first five well pads at Narrows Lake. After bringing the first two well pads on, we’ll begin steaming the third later this year with two more to follow in 2026. Outside of Christina Lake, performance at Foster Creek continues to be exceptional with production of 203,000 barrels a day over the quarter. This was a result of new well pads drilled into a very high-quality reservoir coupled with a successful redevelopment and optimized program. Foster Creek is now undergoing a turnaround that began in mid-April, and we’re making excellent progress on the turnaround. We’re already bringing back production to around 170,000 barrels a day with the remainder of the volumes expected to be back before the end of May. During the turnaround, we’re completing some of the tie-ins as part of the optimization project that will add four new steam generators at around 80,000 barrels a day of steam capacity. This will be the first new steam capacity added at Foster Creek since 2016, enabling us to bring forward high-quality resource that will add 30,000 barrels a day of production. The project is now 75% complete and on track for first oil in early 2026. At Sunrise, production averaged about 52,000 barrels a day in the quarter. In April, we brought on the fourth and final well pad from our first well package since acquiring this asset, and we’ve now completed the first phase of our growth program, which was focused on the central development area. Now starting in May, we’ll be commencing on the first of two turnarounds at Sunrise this year in preparation for bringing on the next phase of well pads from the East development area. This will move us into some of the highest quality reservoir in the portfolio and will allow us to fully optimize the steam capacity, leveraging new Cenovus well and completion designs. That means lower SORs and higher production as we bring those well pads on starting in early 2026. In the offshore segment, Atlantic volumes were higher quarter-over-quarter as we saw increased rates from Terra Nova and the White Rose field returned to production in March. Now most importantly, the West White Rose project continues to make great progress. The concrete gravity structure is ready to leave the graving dock and will begin to Arnold’s Cove in the next few days. That is where the dry ballasting will be completed before we move the structure to the White Rose field location in June. The topsides are also being prepared for sale out to the field with the transportation vessel now on site in Ingleside. We’ll bring these two major components together for installation this summer, which will position us to commence drilling from the platform before the end of the year and achieve first oil in the second quarter of 2026. In the downstream, Canadian refining performance was exceptionally strong with record quarterly throughput and utilization rate of 104%. We’re certainly seeing the benefit of improvements we’ve made during the upgrader turnaround last year, and we expect that business to continue to perform well despite narrow light-heavy differentials. In the U.S., we’re continuing to build momentum in our operating performance highlighted by strong throughput, lower cost, and better process unit reliability in our operated assets. Our Toledo refinery is currently undergoing a major turnaround, including maintenance on eight major units within the refinery. This work will help to drive a step change in performance going forward. Turnarounds at both our non-operated refineries, which began in the first quarter, are also now complete. With crack spreads improving and our Toledo turnaround wrapping up this quarter, we expect to see a clear runway for our U.S. refining business to deliver higher performance through the second half of this year. I’ll now turn it over to Kam to walk through the financial results.

Thanks, Jon. Good morning, everyone. In the first quarter, we generated $2.8 billion of operating margin at approximately $2.2 billion of adjusted funds flow. Operating margin in the upstream was around $3 billion, an increase of approximately $380 million from the fourth quarter, driven by our strong operating performance and higher sales volumes. Our business continues to significantly benefit from narrow heavy oil differentials since the TMX pipeline came into service last year. Oil sands non-fuel operating costs were $8.92 per barrel in the first quarter as we continue to deliver some of the lowest cost production in the basin. In the downstream, an operating margin shortfall of approximately $240 million reflected seasonally low Chicago crack spreads as well as tighter heavy oil differentials. Our downstream operating margin also included $26 million of inventory losses and $81 million of turnaround expenses in the quarter. In Canadian Refining, our operating margin was $68 million, up $21 million from the prior quarter despite a nearly $4 per barrel decrease in the upgrading differential. Operating costs in the Canadian Refining business were $10.81 per barrel, also down around 12% relative to Q4, excluding turnaround costs. We are also pleased with the progress we made in the first quarter in the U.S. Refining business. Our adjusted market capture of 62%, which excludes inventory holding gains and losses or FIFO impacts, was approximately 10% higher than the fourth quarter. This reflects higher reliability and resulted in an increase in adjusted refining margin of more than $2 per barrel. Excluding turnaround costs, our operating costs in the U.S. Refining business were $1,215 per barrel. Importantly, we saw a continued decrease quarter-over-quarter in controllable costs in our operated assets, and we expect those costs to continue to trend downward over time. Capital investment of $1.2 billion was driven by sustaining activity across the business, as well as growth capital in both the Oil Sands and Atlantic region, where we’re advancing our major projects. Free funds flow was approximately $1 billion in the quarter. And consistent with our commitment to grow shareholder returns, our Board of Directors has approved an 11% increase to the annual base dividend to $0.80 per share. This increased dividend and the sustaining capital required to maintain our business is fully supported in a $45 per barrel WTI oil price. This dividend increase is an outcome of the continued growth we see in our business. And as we deliver our growth projects and build momentum in our Downstream business, we’re confident in our ability to continue to grow our dividend consistently over time. Our net debt was approximately $5.1 billion at the end of the first quarter. This includes the redemption of the preferred shares, an increase in non-cash working capital largely related to tax installments and payments of annual incentives, as well as normal course reductions in accounts payable. While our net debt remains elevated above our $4 billion target, we are prioritizing the balance sheet with our excess free funds flow, while continuing to remain active with our NCIB given the current valuation of our shares. In total, during the quarter, we returned $595 million to shareholders through dividends, share buybacks, and the redemption of the preferred shares. Subsequent to the end of the quarter, the company repurchased $178 million worth of shares through our NCIB from May 1 through to May 5 or about 11 million shares. With the value we see in our shares today and with the capital investment decreasing as we complete our major projects, we see a significant opportunity to increase our returns to shareholders through buybacks going forward and continuing to ensure our balance sheet remains strong. I’ll now turn the call back to Jon for some closing remarks.

Great. And thank you, Kam. We accomplished a lot in the first quarter. And looking forward, we’ve had a great start to the second quarter, and we have a lot more to do over the next six weeks. By the end of Q2, the vast majority of our 2025 turnaround activity in both the upstream and the downstream will be behind us. Narrows Lake will be ready to begin production and both the concrete gravity structure and the topsides for West White Rose will be preparing for installation offshore. With major maintenance activities behind us and production beginning to ramp up, we’re positioned for a very clear runway of strong operating performance in the second half of the year and into 2026. Now with the recent volatility in the market has been a good reminder of why we put our strategic priorities and financial framework in place. We continue to progress our growth plans with minimal impact on the business. This financial discipline, coupled with our focus on reducing costs, makes Cenovus resilient and durable for the long term and well-positioned in any reasonable commodity price scenario. And with that, we’re happy to take your questions.

Thank you. The first question is from the line of Greg Pardy from RBC Capital Markets. Your line is now open.

Yes, thanks. Good morning. And I appreciate the rundown. Jon, can you dig into the scope of the work you’ve got going on at Toledo? I guess that you’re wrapping up, but also maybe what the objectives are in terms of the stepwise improvement performance that you referred to?

Yes, sure. Good morning, Great. So at Toledo, we’re currently in turnaround in the smaller part of the plant. I think it’s the west side of the plant. I often get Lima and Toledo mixed up, and we call one north, one west. But I think it’s the west side of the plant. But we’re into eight major vessels. So, this would include the small crude unit, the cokers, the reformer, the tail gas unit, and the like. But the real intention here, Greg, is just to continue on this journey of improvement in the reliability of our assets. So we’ve got a very tight scope on this and we’re now through, I think, the riskiest part of the turnaround, and we’ve been through all our major inspections, and we’re continuing forward. As I mentioned in my call, we see this as kind of ramping up in the second quarter and sort of the mid-June timeframe. But it really marks a progression of improvement that we’ve been making through our assets over the past while. So you’ll remember in Q2 last year, we took down the Lloyd upgrader for a major turnaround; that asset operated incredibly well coming out of that turnaround, as we were able to eliminate a lot of the major issues that were haunting us there. Likewise, in Q3 and Q4, we took down Lima and that asset has operated really well coming out of turnaround, operating at or close to full capacity through Q1, and that continues through Q2. So, we expect to see the same kind of step change performance in Toledo coming out of this and looking forward to an unencumbered run through Q3 and Q4, where we don’t have any major outages in our downstream business.

Okay. Got it. Thanks for that. Maybe just shifting gears onto the marketing side, just at times, the realizations on Foster Creek can be just a little all over the place, at least by our yardstick. And I’m just curious, how do you decide on Christina or Foster Creek in terms of moving those barrels through TMX into Asia or California or moving them down into the lower 48?

Greg, that’s a great question. When you look at the assets on an asset-by-asset basis, you’re going to continue to see that movement around. When you take a look at Oil Sands as a whole, you’ll find that the value of the assets we own for moving product around sort of consistently resolves themselves at the Oil Sands level. The reason for that is we make a decision every month, taking a look not only at locational differentials between Alberta and the West Coast, Alberta and the Gulf Coast, but we also take the grade differential into account. So there are slight differences in quality between the high 10 and low 10. And we do find that that moves around notably in the U.S. rather than so much on the West Coast. But we will move to find an extra $0.25, $0.50, $0.75 on grade choices, and that is to optimize the value of pipeline contracts like Trans Mountain, Keystone, and Flanagan South. So I think you’ll continue to see that movement. But within the Oil Sands segment, you should see it resolve itself based on those larger market indicators.

Thank you. The next question is from Dennis Fong from CIBC.

Hi, good morning. And thanks for taking my questions, as well as congratulations on a really strong quarter.

Good morning, Dennis.

Yes, good morning. My first one is just on the Downstream side and a bit of a follow-on to Greg’s question. As you’ve have gone through the – as you just highlighted, the major part of the turnaround in Toledo, like are there any parts of the facility that you found can be further optimized? And further, how are you thinking about product marketing and so forth once you’ve kind of ramped that asset back up?

Yes. One of the things we’re always looking to do, Dennis, is improve the ability of our refineries to operate more efficiently, capture more margin, and take costs out of the system. And those things are all tied together. One of the longer-term or medium-term objectives that we’ve got is to really start to run Lima and Toledo as an integrated operating unit. Those refineries were meant to be run together; they were designed that way. And ultimately, that’s the direction we’re going. So in light of where we’ve been over the last six months in dealing with some fundamental reliability issues and getting that behind us, you probably haven’t noticed that we are also working on a number of things to get products to market in a different way that captures more and more margin for us. So some of the things that I would point to is opening the dock at Toledo and moving more and more product off the dock, getting those products into higher realization markets. We’re looking at all options of egress from really rail to marine to pipe, and we’ve got some interesting things happening on the pipe side as well. But as we progress this and increase the competitiveness of these refineries, we’re really tackling this on all fronts.

Great. I appreciate that color on the Downstream side. Shifting gears towards Upstream. I wanted to kind of ask a question on Sunrise here. Obviously, you’ve been making a lot of progress on that particular asset with kind of the new well pad adds and a view of increasing production over the next couple of years. As you further optimize that, how are you thinking about where OpEx and SOR could actually trend towards? And kind of what’s the upside in terms of this asset, maybe in terms of applying again Cenovus best practices in terms of underlying operations?

What we’ve talked about publicly, Dennis, is taking that asset to about 75,000 barrels a day. And that would tell you that the SOR is coming down from its design basis of about 3.5 to something close to 3 and potentially below that. And one of the things that’s really exciting for us on that asset, and I mentioned this on the call, is we’re actually moving to the eastern side of Sunrise, which is some of the best resources that we have inside our portfolio. So as we move into what we call the V-pads, which would be the 1, 2, and then you’ll get 4 and 5 and 3 later on, these are some of the best reservoirs that we have in the portfolio. We’ll be drilling longer wells with the steam separators who really give us the ability to use steam differently. Ultimately, the recovery on these wells is enormous as well. Some of the best wells that we have in the V-pads are going to recover north of 4 million barrels over their life. So we’re really excited about the strength and quality of that reservoir. And as we move more and more into it, you’ll see the SOR come down, and you’ll see the production come up to that 75,000 barrels a day that we talked about.

Thank you. The next question is coming from the line of Menno Hulshof from TD Securities. Your line is now open.

Thanks, and good morning, everyone. I’ll start with a question on the CapEx profile in your slide deck that points to a fairly large drop in 2026 on spending into the $4 billion range. So my question is, what is your confidence level in that estimate? And what are the factors that could nudge the 2026 budget a bit higher or lower as the year progresses?

Yes. Thanks for the question, Menno. I’ll start by prefacing this, and then I’ll turn it over to Kam. But the capital spend actually starts to come down in the fourth quarter this year as some of our projects move from the project phase to commissioning and startup. But we have high confidence that we are going to be decreasing our capital budget from the $5 billion that we’ve been running at to a lower number in 2026. But maybe you want to take that on, Kam?

Sure. So Menno, I think at the end of the day, we were – to start, this is really a function of the fact that we spent the last three years focusing on the growth plan that we've gotten. As you know, this year, we’ve got about $1.4 billion to $1.8 billion of growth spend. And that growth really in earnest starts to show up this year and going through into 2027. So I think the big benefit we’ve got is we’ve got a fairly robust trajectory of volume growth over the next few years and couple that with, I’d say, a desire to have lower spending. I think at the end of the day, we are really focused on driving what’s the best value for our shareholders. So I think given other capital allocation priorities we have, particularly around shareholder returns, I think we’ve got pretty high confidence that you’re going to see the capital come down. Just to give you a bit of a frame of reference, one of the biggest changes you’re going to see year-over-year is as West White Rose gets completed; that will probably singularly be one of the largest decreases we’re going to see in capital profile going into 2026, given that project will be largely completed by the end of this year and the drilling of the wells starting up in late Q4 and into Q1. From a confidence level, I think at the end of the day, we’re pretty confident that we’re going to see a drop. And I’d say, for now, somewhere in that low $4 billion range is a good starting point for you guys to think about for 2026.

Great. Thanks for that. And then my second question is on Narrows Lake and how it ultimately gets reported. My understanding is that it simply gets flared into Christina Lake reporting right out of the gate, but maybe you can confirm that. And then second, you touched on this in your opening remarks, Jon, but what sort of an impact are you expecting Narrows Lake to have on overall Christina Lake blend quality in netbacks? Thank you.

Yes. So you’re absolutely right, Menno, this is going to just be part of the Christina Lake reporting. It’s all one complex now. In terms of quality of production, it’s very similar to what we see at Christina Lake. Now the interesting thing, though, and I touched on this in my opening comments, is building that pipeline of 17 kilometers and getting that operating well and seeing the start-up as flawlessly as we have seen it also gives us a lot of confidence to think about resource development going forward in places like Kirby West, which is to the south of Christina Lake, and seems accessible with the technology that we’ve got today. So it really does open up a lot of things for us at Christina Lake. But in the short term, what you’ll see is Narrows just come into Christina; it will be reported as one complex and the point that I was making earlier is that the quality of crude is very similar.

Thank you. The next question is coming from the line of Neil Mehta from Goldman Sachs. Your line is now open.

Hey, good morning, Jon and team.

Hey Neil.

Hey, good morning, Jon. Wanted your perspective on West White Rose, we’re getting close to that inflection. I know there are some really big milestones ahead here over the next six months. So we want to just see how that’s tracking and what you’re spending time thinking about?

Yes. We use the word inflection a lot inside this company, and it describes where we think we are as a company as well. But as I mentioned in my notes, and I’ll just kind of give you a rundown of how we see this project unfolding over the next six to eight months. We are literally days away from towing out the gravity-based structure from Argentia, and we’ll take it to a place called Arnold’s Cove, where we’ll do the dry ballasting. That could happen as early as tomorrow, but it’s going to happen over the next few days. Similarly, we have the Cosco vessel now in Ingleside and is preparing for the load out of the topsides that will happen at the end of the month, early June. In June, we will tow the gravity-based structure out to the field, and we will place it on the seabed, and then in July, we’ll bring the topsides from Bull Arm, and we’ll make them up with the gravity-based structure. From there, there’s a few months of commissioning and start-up work. In Q4, we’ll start drilling with first production expected in the second quarter of 2026. But it’s a pretty exciting time, and this is becoming very real, very quickly.

Jon, as you think about de-risking those items, what is the most important of them? And how much confidence do you have that you have mitigated those risks?

Well, we have great confidence in where we are today. We actually floated the gravity-based structure last night. We continue to de-risk this project and get to important milestones in a very methodical way. So there’s nothing that we’re doing here, Neil, that is unique and out of sequence with what others have done in this basin. It’s just big pieces of equipment happening in very short periods of time right now.

Thank you. The next question is coming from the line of John Royall from JPMorgan. Your line is now open.

Hi, good morning. Thanks for taking my question. I was disconnected for a chunk of the call, so I’m hoping that none of this was addressed. But I wanted to start on capture rates in refining and – you had a nice improvement this quarter despite a tight dip. You mentioned some impact from improvements you made at Lima. Should we expect that given you’ll be back in turnaround this quarter with Toledo, that 2Q should come off a little bit on the capture rate? And then you talked about 70% plus being a range that’s kind of a near-term target. Is that achievable in the second half? Or would we need some more help from just to get there?

Yes. You kind of touched on the three things that impact capture rate. One is the definite that has certainly been tight. Although it’s good for the company, it does impact our capture rate and ability to drive profitability in the downstream, and we expect that to stay tight through the second quarter. The second thing is reliability and are you producing the products that you expect to produce. That’s happening as per plan, and I think we’re in good shape there. That allows you to place those products effectively into the market, and that’s the third thing. So as we work through the turnaround in Toledo, that obviously affects Q2, but coming out of that, we expect to be well above the 62% that we were in Q1.

Great. Thank you. And then my second question is on the pacing around the buyback. In Q1, you had some purchases as well as the big working capital build. The buyback was a little lighter, but you came out of the gate pretty strong quarter-to-date despite going into a big turnaround period and also prices down a bit. So if you could just talk about the cadence on the buyback side and how you think of how that interacts with the different moving pieces on cash flows? That would be helpful.

Hey, John. It’s Kam. A couple of things I would just say on the buyback program. I think obviously, we’re always continuing to monitor cash flows, inflows, outflows quarter-by-quarter. In Q2 here, we’re going to have a fairly heavy period for turnarounds and turnaround costs as it relates to Toledo and Foster. But what I would say is – I just step back a little bit and just describe our buyback is going to be very flexible. It may not necessarily be ratable over time, but we’re going to be value-focused on that buyback. So obviously, we stepped it up a little bit, as we talked about on the call here in April, repurchasing just under 11 million shares. So I think we’ll be thoughtful about when we do it, when we use that capital. But I would say at the same time, the reason we’ve got that flexibility is our balance sheet is strong. Although we’re not right at that $4 billion floor that we talk about for debt, I don’t think that’s necessarily going to stop us from being value-flexible around where we see opportunities. So yes, I wouldn’t necessarily hold us to some ratable form of a buyback, but I think where we can use our balance sheet and where we see value, we’ll continue to assess it. Over the long term, obviously, we want to target getting to 100% returns, but that’s not necessarily what you’re going to see on a quarter-by-quarter basis.

Yes, John, I’d just add to that. One of the things that I say is we are never going to put this balance sheet at risk, and we have a $4 billion leverage target for a reason. But there is a fine line between discipline and dogma. And when you have opportunities like we have with the share price being where it is, I think it’s incumbent on us to take a look at that understanding that we have one of the best balance sheets in the business.

Thank you. The next question is coming from the line of Patrick O’Rourke from ATB Capital Markets. Your line is now open.

Good morning, Patrick.

Good morning and thank you for taking my question. I guess, maybe just to build a little bit upon the discussion we were just having with John. Just curious in terms of where you see the most attractive sort of application of shareholder returns right now. You’ve been aggressive with the buyback in May, but you also raised the dividend. And then, of course, we’ve got another tranche of the preferreds that are coming up as redeemable here, and how you think about that allocation? And of course, I guess there’s the interplay you talked about on the balance sheet of how working capital releases through the balance of the year.

Hey, Patrick, it’s Kam. Maybe a couple of things I would highlight. I think first off, maybe I’ll start with the base dividend. I think we’ve been very clear. We’ve got different components to our shareholder return strategy. I would describe the base dividend as being more a commitment versus, say, discretionary returns, which is what the buyback any and a variable dividend could be over time. But when you look at the base dividend, it’s really about creating a business plan and a strategy that continues to allow us to predictably and ratably grow our dividend over time. And that’s all underpinned, I would say, by our five-year plan that we outlined last year. So obviously, I think the dividend growth that we’ve given this year, 11%, is consistent with that long-term strategy. Last thing I would just say on the dividend is, it’s always going to be anchored to our ability to sustain that dividend in a $45 WTI price. I think as that business plan continues to deliver, we’re going to have more capacity to grow that over time. When you think about the interplay between other capital allocation priorities, particularly around buybacks and even preferred shares, I would say market conditions are continuing to move around. They’re volatile. We are going to be flexible and thoughtful about where we see the most value. Obviously, we took out the preferred share Series 5 back in March at the end of March, which was $200 million. We’ve got another series due here at the end of June and another $150 million and then $300 million next year. I’d say that long-term, the preferred shares had a time and a place in our capital structure years back when Husky put them in place. Those drivers are probably not the same today, but at the same time, I think if we see better opportunities to deploy cash like a buyback, we may choose to do that.

Okay. Great. And then I know it’s small in terms of cash flow generation here, but one thing that stood out to me in the quarter was the margin that was created in the conventional business. I think it was above – substantially above the highest estimate on the Street. Looking at the netbacks, there was a big jump in price realization there. Is that just a function of better gas pricing in the basin? And what’s the sort of appetite to continue to grow that particular business as we see AECO basis improve here?

So, two parts to that. One, obviously, we’ve seen gas prices do what gas prices have done. I wouldn’t say that quarter one to quarter one comparison is meaningfully different. But when you look at Q4 to Q1, AECO price all-in was better. However, the part that you need to make sure you add is that we do have some pretty valuable and significant pipeline space that moves natural gas out of the basin. I would point you to last year as the easy way for you to think about it over time where that added in the order of about US$1 per MMBtu to our realizations. So I think that’s probably the first thing you should anchor on there, and I’ll turn it to Jon for the balance.

Just on the second piece, as I mentioned, Patrick, in my opening remarks, we’re really focused on four things right now for the balance of 2025 and going into 2026. We are focused on our base business, delivering growth, competitiveness of our Downstream, and maintaining our cost structure. While we really like our conventional business, we believe we’ve got some really interesting opportunities. It’s not a story for this quarter or this year, but at some point in the future, we’ll come back and we’ll talk about the conventional business more comprehensively. Right now, we are focused on the four things that I mentioned.

Thank you. The next question is coming from the line of Manav Gupta from UBS. Your line is now open.

Hey. Good morning. I think you discussed a number of growth projects, including Christina Lake and others. I just wanted to touch on Foster Creek. I think you’re looking to grow volumes there about 30,000. So can you help us understand what’s the progress on the volume growth in Foster Creek and when should we expect it to be online?

Yes. Foster Creek is really the only project we’ve got where we’re adding steam capacity. As I mentioned, we’re adding about 80,000 barrels a day of incremental steam. We’ve got some good reservoir in front of us, both to the west and to the north. What you’ll see from us through the rest of the year is we’ll finish the installation of the steam that will happen this summer. We’ll finish the oil and water handling by the end of the year to make that a live project going into 2026. So early on in 2026, you’ll see the growth coming out of Foster Creek as well.

Perfect. And you do have a lot of turnaround in this quarter, both Upstream and Downstream. So help us understand some of the risk planning around this to make sure these conclude on budget and on time? Thank you.

Yes. Manav, I would describe we’ve been in a heavy turnaround period for the last year, and we’re really coming to the end of it. Most of this ends within the next six weeks. As I mentioned in my opening remarks, we’re now complete with the turnaround work at WRB; both Borger and Wood River are running online. We’re largely complete with the turnaround at Foster Creek, and we’re about in the middle of the turnaround at Toledo. On the 15th of May, we’ll start our turnaround at Sunrise, that’s a fairly low-risk event. Coming out of Q2, the vast majority of our turnaround major maintenance work is done. I think we have one more turnaround in this fall at Sunrise. Outside of that, we’re emerging from a period of heavy maintenance into a period where we don’t have anywhere near the same magnitude of major maintenance going forward. We’re really looking forward to that. But if I were to tell you where we are in terms of the risk profile, the vast majority of this has now been de-risked, and we’re looking to wind up these turnarounds and get everything back to full production.

Thank you. The next question is coming from the line of Menno Hulshof from TD Securities. Your line is now open.

Hi. Thanks for letting me back on. Hi again. I’m only asking this question because I’m getting the question. It’s related to your definition of market capture, which was adjusted for the quarter. I did read the footnote. My understanding here is that the inventory effect gets smoothed out and that the average market capture doesn’t change over time when compared to the original definition. But maybe you could just walk us through the mechanics and the rationale for the change? Thank you.

Hey Menno, it’s Kam. So maybe I’ll – if you want tons of detail, I’ll say, talk to the IR team offline. But just to give you a highlight. What we’ve done there is the way we calculate the market capture takes the two key benchmarks that drive the profitability of our U.S. downstream business, including Group 3 in Chicago. That percentage you see there is a percentage of a blended crack of those two benchmarks. This quarter, what we’ve done is we’ve adjusted it for what we describe as inventory holding gains and losses or FIFO impact so that you can actually see what the underlying business performance is absent of those inventory movements that you typically see because of FIFO accounting. When you look at our supplemental information, you can see there we’ve adjusted it going backwards, so you can see what the impact of that is normalized for FIFO.

So the intent there is just to make it more comparable with what you see with the U.S. refiners in those regions.

All right. Thanks, Menno.

Thank you. At this time, we have no questions in the queue. We will wait a minute to give you the chance to connect with us. The next question is from the line of Chris Varcoe from Calgary Herald. Your line is now open.

Hi Jon. Thanks for taking the question. With the federal election now over, what is the status of talks between the pathway alliance and the federal and provincial governments? And I guess, how far apart or how close are the three sides?

Chris, we’re kind of in a bit of a holding pattern right now. The election has only just happened. And what we’ve always maintained is that pathways and the projects underneath that are a priority for us. We need those two levels of government to come together and create a path forward for us where those projects can get done, and the industry can remain competitive. There’s not much in the way of new news on that, but it’s something that we maintain as a priority, and we’re hopeful we can get back talking at both levels of government fairly quickly.

Thank you. The next question is from the line of Alex Bill from NewfoundlandLabrador. Your line is now open.

Good morning.

Hi Alex.

Hi there. Yes. I am following up on reports of layoffs at this time. I’m asking how much of that is captured in Newfoundland and whether that has to do with the transition of West White Rose or broader economic principles?

One of the things we haven’t done, Alex, is talk about numbers or talk about locations where we’ve seen job loss. We do that out of respect for the families and respect for the employees. This is a very private matter, and we want to treat people with dignity and respect. As a company, we are getting to the end of an investment cycle in this business, and our capital spending is decreasing. Consistent with that, the amount of work that we have to do is decreasing. That means we’ve got to readjust our labor force to make it fit for purpose and ensure that we are competitive as an industry. I don’t have an exact number for you, nor would I probably give it to you, just to be respectful of the people that are involved in this.

Thank you. And there are no further questions registered at this time. I would now like to turn the meeting back over to Mr. Jon McKenzie.

Great. And thank you, operator. So this concludes the conference call. Thank you for joining us today. We really appreciate your interest in the company, and have a great day, everybody. Thank you.

This concludes today’s program. You may all disconnect. Thank you for participating in today’s conference, and have a great day.