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Cenovus (CVE) Sets Climate Targets to Attain Carbon Neutrality

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Cenovus Energy Inc. (CVE - Free Report) joined some of the industry peers in setting a target of net-zero emissions to achieve carbon neutrality, while avoid deviating from its traditional oil and gas business.

Oil-sand producers are facing immense pressure from investors and activists to lower the environmental impacts of business operations as the extraction of crude oil from oil sands produces a significant amount of greenhouse gases. Hence, Cenovus, which produces crude from Canada’s oil sand, sets new emission-reduction targets and has invested in clean energy to convince eco-minded investors.

Notably, Canada-based oil producer Canadian Natural Resources (CNQ - Free Report) also sets new emission-reduction targets and slashed its carbon intensity by 18% per barrel by 2016-2020. However, it does not intend to majorly invest in renewable energy as the company still expects to have oil demand over the long term.

Considering the reputation of the oil-sand industry, Cenovus and Canadian Natural have been trying to regain public confidence as they extract some of the most carbon-intensive crude in the world, which emits a large amount of greenhouse gases. Notably, investors are progressively focusing on the environmental, social and governance performance of those firms, thereby, pushing oil-sand companies to shift to renewable energy.

Another Canadian oil producer Suncor Energy Inc. (SU - Free Report) is making progress toward its goal of reducing the emission intensity of production by 30% by 2030 compared with the 2014 levels. Canada’s prime minister Justin Trudeau intends to increase carbon price significantly over time in order to make the country carbon-neutral by 2050.

Company Profile & Price Performance

Headquartered in Calgary, AB, Cenovus is a leading integrated energy company.

Shares of this utility have outperformed the industry in the past six months. Its stock has gained 90.4% compared with the industry’s 50.5% growth.

 

 

Zacks Rank & Stock to Consider

The company currently carries a Zack Rank #3 (Hold).

One better-ranked player in the energy space is Devon Energy Corporation (DVN - Free Report) , currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Devon’searnings for 2021 are expected to increase 28.8% year over year.

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