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When ConocoPhillips Co. took a multibillion-dollar stake in Cenovus Inc. in early 2017 as payment for assets it was selling, the Texas giant promised it would eventually sell its shares in an “orderly” way.

But a Reuters report on Monday that said the company is getting ready to dump its 208 million Cenovus shares led to some disorderly trading in one of Canada’s largest oil sands companies, with Cenovus falling almost 9 per cent in midday trading before closing at $12.67, a drop of almost 6 per cent.

It’s the latest blow for Cenovus, which has been stumbling ever since it struck the deal last year to buy almost $18-billion in oil sands assets from ConocoPhillips with a combination of cash, shares and debt. Investors who had loved Cenovus’s pristine balance sheet and conservative profile rebelled, sending shares down more than 30 per cent that spring.

While the shares have rebounded from a 52-week low of $8.89, the company’s attempts to placate shareholders through asset sales and a new executive team have generally failed, as the stock has never regained its March, 2017, predeal highs.

ConocoPhillips never said it would be a long-term Cenovus holder. The deal’s terms called for just a six-month lockup period before it could sell the stock. In a conference call last year, ConocoPhillips chief financial officer Don Wallette said: “We don’t see ourselves as strategic investors in Cenovus and we will liquidate our position over time –and we’ll do it in an orderly way because it’s in our best interest.”

Neither Cenovus nor ConocoPhillips commented on Monday’s report, and Cenovus declined to comment to The Globe and Mail Monday afternoon.

Reuters said ConocoPhillips has held discussions with investment banks about a potential sale of its Cenovus stock “and could offer the shares to institutional investors as early as this month.” The story suggested the shares would be sold in their entirety and noted the recent “overnight stock sale” by Royal Dutch Shell PLC of its entire stake in Canadian Natural Resources Ltd. for US$3.3-billion.

The original investor agreement restricts ConocoPhillips’s ability to sell a block greater than 5 per cent of Cenovus’s shares outstanding without the Calgary company’s permission. The 208 million Cenovus shares represent almost 17 per cent of the company.

Sold as a whole or in pieces, ConocoPhillips may see its best chance to get some value back from a position on which it has taken a sizable loss, on paper. Based on the average price for the 21 trading days leading up to the March, 2017, announcement of the transaction, the stake was worth just less than $3.5-billion; after Monday’s decline, the stake is now worth just more than $2.6-billion.

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