CORRECTED-UPDATE 1-Canadian Natural to buy some of Devon's Canadian gas assets
(Corrects currency in paragraphs 1 and 4 to C$ from US$)
Feb 19 (Reuters) - Canadian Natural Resources Ltd , the country's largest independent oil producer, said on Wednesday it would buy some of Devon Energy Corp's liquids-rich natural gas assets in Canada for C$3.13 billion ($2.86 billion).
The deal, which will immediately add to Canadian Natural's earnings and cash flow, excludes Devon's Horn River assets in northern British Columbia and heavy oil properties in Alberta.
Canadian Natural said the acquired royalty revenue would either be folded into a new vehicle to provide steady cash flow to existing shareholders or be sold off later this year.
The royalty revenue from the deal is expected to earn Canadian Natural about C$75 million in cash flow during 2014. The cash flow from the combined portfolio is expected to be between C$140 million and C$150 million this year.
Devon said in November it planned to sell all of its Canadian gas assets, hit by years of low prices.
Natural gas prices, which have risen recently due to cold weather in North America, have been weak over the past few years because of a flood of production from shale fields.
Before royalties, the properties being acquired produce the equivalent of about 383 million cubic feet of natural gas per day (mmcf/d), 10,800 barrels per day (bpd) of light crude oil and 12,000 bpd of natural gas liquids.
Under the agreement, Canadian Natural will also buy six natural gas plants, with gross processing capacity of more than 1,000 mmcf/d.
The deal comes more than a month after Canadian Natural dropped plans to sell some of its shale gas-rich Montney properties, which straddle the border of northern Alberta and British Columbia, after failing to attract a suitable offer. ($1 = 1.0957 Canadian dollars) (Reporting by Ashutosh Pandey in Bangalore; Editing by Saumyadeb Chakrabarty)
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