OREANDA-NEWS. February 21, 2012. Oilsands producer Cenovus Energy Inc. has reported sending its first shipment of crude oil to China last week.

In an interview with the Calgary Herald after releasing fourth quarter 2011 financial results, president and chief executive Brian Ferguson confirmed that the company had sent its first half-shipload of oil - about 250,000 barrels - to an unspecified Chinese customer.

``We actually just sold our first cargo last week,'' he said.

``It's very significant because what it allows us to do is establish a relationship with refineries in terms of how they value and price Cenovus crude. So it's very significant strategically.''

Cenovus is one of several producers who have pledged financial support for Enbridge Inc.'s USD 5.5-billion Northern Gateway oil pipeline, for which National Energy Board hearings are continuing.

The 1,200-kilometre proposed pipeline from Bruderheim northeast of Edmonton to the coastal community of Kitimat, B.C., would move up to 525,000 barrels of oil per day likely by about 2017.

But it is being opposed by thousands of interveners based on environmental concerns.

Ferguson said last week's shipment was made possible by Cenovus gaining 12,000 barrels per day of service on the TransMountain Pipeline that runs from Edmonton to the Westridge Terminal in Vancouver.

Most of the oil shipped starting late last year has been bound for California customers and, although it's less than 10 per cent of overall company oil output, it has helped the bottom line, Ferguson said, because it is fetching a premium by being priced in relation to Brent crude instead of West Texas Intermediate.

``It's allowing us to get tidewater pricing off Brent so there's a significant uplift per barrel in terms of price realization,'' said Ferguson.

Also Wednesday, Cenovus announced that it would extend its search for a joint-venture partner on its Telephone Lake oilsands assets in northern Alberta.

It applied in December for regulatory approval for a 90,000-bpd steam-assisted gravity drainage project there.

Ferguson said on a conference call the reason for the delay is a late surge of interest from international investors.

In the interview, he said those investors are from Asia.

However, he wouldn't answer when asked if Asian companies would be in a position to provide the strategic advantage he has previously said he's looking for, namely a hedging mechanism to offset volatility in the North American light-heavy oil price differential, through refining and marketing or other means.

``In recent weeks, we have seen some significant new international interest from some parties that were relatively late to enter the process so that's what caused us to say that we're extending,'' he said on a conference call with analysts, refusing to give a new timeline.

Ferguson said the company is building a dewatering pilot plant and continuing to drill delineation wells at Telephone Lake.

Cenovus announced Wednesday it would increase its quarterly dividend by 10 per cent to 22 cents per share starting in the first quarter of 2012, with Ferguson noting on the call that the company will look at increasing the payouts as committed maintenance and expansion capital ``tapers down'' over the next three years to about USD 1 billion per year.

Andrew Potter, an energy analyst for CIBC World Markets, called Cenovus' Q4 report ``mixed,'' meeting consensus on cash flow but falling short on operating earnings per share.

``Overall, stronger-than-expected downstream results were offset by weaker-than-forecast oilsands price realizations, higher G&A (general and administrative expenses) and slightly higher-than-forecast cash taxes,'' he wrote in a note to investors.

Fourth-quarter profit rose to USD 266 million, or 35 cents a share, from USD 78 million, or 10 cents, a year ago. Excluding unusual items, the company earned 44 cents a share.

Cash flow, a glimpse into the company's ability to fund operations, rose about 32 per cent to USD 851 million, or USD 1.12 a share, from USD 645 million, or 85 cents a share.

Production rose about 11 per cent to average 144,273 barrels a day, driven in part by a faster than expected startup at the Christina Lake Phase C thermal oilsands expansion.

Cenovus said its results were also bolstered by favourable profit margins at the U.S. refining assets operated by its oilsands partner ConocoPhillips.

The company kept its 2012 capital spending forecast of USD 3.1 billion to USD 3.4 billion, but said it may consider reducing investment in natural gas projects if prices for the fuel did not recover.