Cenovus to sell Palliser assets for $1.3 bln to pay down debt

Canadian oil and gas producer Cenovus Energy said on Thursday it will sell its Palliser crude oil and natural gas assets in southeastern Alberta to Torxen Energy and Schlumberger Ltd for C$1.3 billion ($1.04 billion) to lower its debt load.

The company has been looking to sell parts of its portfolio to pay off the debt it accumulated to partly fund its C$16.8 billion purchase of some ConocoPhillips assets in May.

That deal doubled Cenovus' production assets, but dented its balance sheet, sent the company's shares tumbling, prompted some investors to revolt and led to the resignation of Chief Executive Brian Ferguson.

Ferguson is set to leave this month.

The Calgary, Alberta-based continues to target between C$4 billion and C$5 billion in asset sale agreements by the end of the year, Ferguson said on Thursday.

Last month, Cenovus sold off its Pelican Lake heavy oil operations in Alberta for C$975 million to Canadian Natural Resources Ltd and followed that up with a C$512 million deal to sell its Suffield oil and gas assets to International Petroleum Corp .

(Reporting by Karan Nagarkatti and Nivedita Bhattacharjee; Editing by Savio D'Souza)