CORRECTED-Encana may sell Deep Panuke natgas project by year-end - report

Fri Jul 18, 2014 5:07pm EDT

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(Corrects third paragraph to change direction to southeast from southwest)

July 18 (Reuters) - Encana Corp , Canada's largest natural gas producer, may sell its Deep Panuke natural gas project, off the coast of Nova Scotia, by year-end, Bloomberg News reported on its website, citing unidentified sources.

The company is working with financial advisers and could begin a formal sales process within months, with a deal raising as much as $2 billion completed by year-end, Bloomberg reported.

Deep Panuke, 250 kilometers (155 miles) southeast of Halifax, produced 253 million cubic feet of gas per day in the first quarter, its first full quarter of operation after years of construction delays.

The company has long maintained it does not consider the project to be central to its operations and could put Deep Panuke up for sale.

Encana is in the midst of a restructuring to increase production of valuable oil and natural-gas liquids while cutting back on dry natural gas and reducing the number of regions where it operates.

Encana shares were up 36 Canadian cents to C$23.28 at midafternoon on the Toronto Stock Exchange. ($1 = 1.0733 Canadian dollars) (Reporting by Scott Haggett in Calgary, Alberta; Editing by Jeffrey Benkoe)

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