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Cenovus CEO Brian Ferguson speaks at the company annual meeting in Calgary, Wednesday, April 24, 2013.

Cenovus Energy Inc. saw its operating profit and cash flow drop in the third quarter on reduced refining results even as the company continued to expand oil production.

The Calgary-based energy giant posted operating profit of $313-million or 41 cents per share in the third quarter, down from $432-million or 57 cents in the year-earlier period.

Cash flow decreased 17 per cent to $932-million from $1.1-billion in the same period in 2012, mainly due to a significant decline in refining operating cash flow, the company said on Thursday.

Net profit in the third quarter was $370-million or 49 cents per share, up from $289-million or 38 cents a year earlier, largely due to unrealized gains from hedging versus losses in the year-earlier period.

Meanwhile, oil production increased 40 per cent to $915-million in the third quarter, compared with the year-earlier period, boosted by higher oil prices and increased volumes.

Cenovus said it is on track to achieve its goal of producing more than 500,000 barrels per day by 2023.

Total net oil production – including oil sands – in the third quarter was 176,938 barrels per day, up from 171,350.

"Stronger realized crude prices and higher oil production led to a solid increase in operating cash flow from our oil assets in the third quarter. That helped offset most of the impact from a significant drop in market crack spreads and higher feedstock costs which led to a large year-over-year decrease in operating cash flow from our refining assets," Cenovus president and chief executive officer Brian Ferguson said in a news release.

The company said the stronger results from oil operations were largely due to a major increase in production at its Christina Lake oil sands project.

Christina Lake volumes increased 63 per cent in the third quarter versus the same quarter of last year.