Encana to sell Bighorn gas assets for $1.9 billion

Fri Jun 27, 2014 8:11am EDT

President and CEO of Encana Doug Suttles addresses shareholders at the company's annual meeting in Calgary, Alberta, May 13, 2014. REUTERS/Todd Korol

President and CEO of Encana Doug Suttles addresses shareholders at the company's annual meeting in Calgary, Alberta, May 13, 2014.

Credit: Reuters/Todd Korol

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(Reuters) - Encana Corp (ECA.TO) (ECA.N) said it would sell its Bighorn gas properties in Alberta to Apollo Global Management LLC (APO.N) for about C$2 billion ($1.9 billion) as it focuses on more-lucrative oil and natural-gas liquids (NGLs).

The sale to Apollo-controlled Jupiter Resources includes about 360,000 net acres comprising Encana's working interests in all pipelines and production facilities as well as service arrangements.

The Bighorn properties produced 319 million cubic feet equivalent of liquids-rich natural gas per day (after royalties) in the first quarter, Jupiter said.

Total net proved reserves of the properties at the end of 2013 were about 1,100 billion cubic feet equivalent (Bcfe), with about three quarters natural gas.

Canada's largest natural gas producer is selling off natural gas properties while adding oil and NGLs assets to boost its earnings after years of weak prices for the fuel.

In March, the company sold its properties in Wyoming's Jonah natural gas field to an arm of private equity firm TPG Capital [TPG.UL] for $1.8 billion. The company also sold about 90,000 net acres in east Texas in April for $530 million to an undisclosed buyer.

Shares of the Calgary, Alberta-based company closed at C$25.58 on the Toronto Stock Exchange on Thursday. They have gained about 33 percent in the last six months.

(Reporting By Narottam Medhora in Bangalore; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)

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