Canadian oil company, Cenovus Energy Inc. (CVE - Free Report) announced that it will invest $2.5 million in Skyonic Corp. to develop technology to transform carbon dioxide emissions into useful products. Cenovus would dish out the funds through its wholly owned subsidiary – Cenovus Environmental Opportunity Fund Ltd.
Skyonic would utilize the funds for the ongoing construction of its carbon capture and utilization plant in San Antonio, Texas. This plant is expected to be operational in 2014.
Based in Austin, Texas, Skyonic is a recent start-up. Once operational, the plant would transform carbon dioxide emissions from industrial waste streams into solid carbonate and bicarbonate or baking soda. The baking soda thus recovered would be utilized in the livestock and food industries. Skyonic’s plant would also produce chemicals such as hydrochloric acid, bleach, chlorine and hydrogen as by-products. The aforementioned chemicals also have a ready market for cleaning air pollutants.
Headquartered in Calgary, Alberta, Cenovus is an integrated oil company with ownership interest in two high-quality refineries in Illinois and Texas. Cenovus’ operations include increasing oil projects and growing natural gas and crude oil production in Alberta and Saskatchewan. The company has four top-quality enhanced oil projects, namely, Foster Creek, Christina Lake, Pelican Lake and Weyburn.
Cenovus enjoys the benefits of industry-leading oil sands assets that position it for long-term growth. We believe the company will remain focused on improving its operational efficiency initiatives throughout 2013.
However, Cenovus reported weaker-than-expected first quarter 2013 results due to lower crude oil price realizations. Earnings per share came in at 44 cents, missing the Zacks Consensus Estimate of 47 cents.
Cenovus currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, in the energy sector, firms that are expected to significantly outperform the broader U.S. equity market over the same time frame are InterOil Corp. , Oasis Petroleum Inc. (OAS - Free Report) and Oiltanking Partners LP . All three firms sport a Zacks Rank #1 (Strong Buy).