EnCana Corp. late Thursday said it would sell nearly half a million acres of natural gas-weighted property in west-central Alberta to Bonavista Energy Trust for $632 million.
The 409,000 net acres to be sold to Bonavista are 80% weighted to gas and currently produce about 60 MMcfe/d after royalties, EnCana said. The properties are considered noncore.
The transaction includes properties known as the Hoadley trend, which covers an area west of Red Deer, AB, running from Caroline north to the Pigeon Lake area just south of Edmonton.
“This sale reflects our ongoing efforts to high-grade our portfolio of producing assets, and it represents a substantial portion of our 2009 divestiture target of between US$500 million and $1 billion,” said EnCana CEO Randy Eresman. “We continue to look for other opportunities for divestitures and acquisitions to improve the long-term value creation capacity of our extensive North American unconventional resource portfolio.”
The sale, with an effective date of April 1, 2009, is expected to close by the end of September. Tristone Capital was EnCana’s financial adviser.
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