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Cenovus Energy plans to continue expanding its Foster Creek and Christina Lake projects in northern Alberta, as these two sites are still turning a profit even at current oil prices.

Todd Korol/Reuters

Companies operating in the Canadian oil patch say they are coping with the downturn, and planting the seeds for a rebound when prices recover.

"What we are seeing today will pass," Christian Bayle, president and chief executive officer of Calgary-based oil storage and pipeline company Inter Pipeline Ltd., told investors at an industry conference in Toronto Thursday. While short-term prospects, especially for the oil sands, may seem diminished, "there is still going to be a lot of growth over the long term," he said.

While low oil prices are forcing many companies to cut capital spending and trim work forces, some are still generating solid profits if they have low-cost assets.

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Cenovus Energy Inc. chief financial officer Ivor Ruste told the conference that two of his company's key oil sands projects, Christina Lake and Foster Creek, have a "break-even cost" of between $40 (U.S.) and $45 a barrel, so they remain profitable even at current prices. "You can see that even in a low oil price environment, we have the opportunity to make money, and will continue to expand those two particular assets."

Oil was trading Thursday at just over $50 a barrel.

To ensure the company can keep funding those low-cost projects in light of cash-flow constraints, Cenovus raised money in an equity offering early this year – a deal that generated $1.5-billion. It didn't want to sell any assets – which would have sold at cut-rate prices – to raise the money, Mr. Ruste said.

Cenovus plans to continue expansion of Christina Lake and Foster Creek "even at these lower prices," he said. And "as we see a line of sight to higher prices – $60 or $65 [and] longer term to $75 – we will continue to expand our oil sands portfolio" beyond those projects, he added.

On the other side of the continent, the break-even cost of East Coast offshore oil is even lower, said Jim Keating, vice-president of oil and gas for Nalcor Energy Inc., the provincial entity owned by the Newfoundland and Labrador government that takes a stake in offshore projects.

"Our break-evens are between $20 and $35 a barrel across the offshore projects," Mr. Keating told the conference. "It is only when we get out to deep water we may creep up to the 50s and 60s. So in terms of robustness and resilience to the market pressures, we are pretty good."

While many producers have been hit hard by the sharp drop in oil prices, firms operating in some other sectors of the oil patch have not taken an immediate hit because the nature of their business gives them stable cash flow.

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That's the case at Gibson Energy Inc., a Calgary-based firm that owns terminals and storage facilities. "We underpin all the infrastructure that we are investing in with longer-term, very stable fixed-fee contracts," CEO Stewart Hanlon said. Indeed, in the current environment storage has been a growth area as there is an incentive to hold onto supplies rather than sell at low prices.

Bruce Beynon, vice-president of exploration at junior oil producer Raging River Exploration Inc., said his firm made very good returns at $70 a barrel on some wells and an "exceptionally quick payout" at $90 or above. "There is a tremendous amount of torque to oil price recovery," he said. Firms like his "really have the ability to move capital into the ground fast" when prices rise.

If prices don't rise soon, a lot of oil assets will go on the auction block and become available to acquisitors with strong balance sheets. Mr. Beynon said if oil prices stay low, the "garden hose" of good assets that are currently being put up for sale "is going to become a fire hydrant by the fall."

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