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The Cenovus enhanced oil recovery facility in Weyburn, Sask.

Cenovus Energy

Whitecap Resources Inc. has struck deal to acquire a controlling interest in a major Saskatchewan oil property from Cenovus Energy Inc. for $940-million.

Whitecap agreed Monday to buy a 62-per-cent stake in the Weyburn carbon-injected oil project, lifting its corporate production by 14,800 barrels of oil equivalent per day.

Under the deal, Whitecap said it would sell $332.5-million in shares at $8.80 each on a bought-deal basis to banks led by National Bank Financial Inc. and TD Securities Ltd. The company also said it would tap its credit facilities and use a $92.5-million non-brokered private placement to fund the deal.

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Whitecap shares closed down 3.4 per cent at $9.11 on the Toronto Stock Exchange. The company also said it would increase its dividend by 5 per cent to 25.7 cents per share starting in January.

Cenovus said proceeds from the transaction would be used to retire the $3.6-billion bridge loan used to help fund its purchase earlier this year of oil sands and natural gas assets ConocoPhillips Co.

The deal brings proceeds from asset sales to $3.74-billion, short of Cenovus's targeted range of $4-billion and $5-billion in divestitures.

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