* Assets located in Wyoming's Jonah field
* Estimated proved reserves 1,493 bln cubic feet equivalent
* Sale also includes over 100,000 undeveloped acres
(Adds details on production and background of properties sold,
joint-venture lands; updates shares)
By Scott Haggett
CALGARY, Alberta March 31 Encana Corp,
Canada's largest natural gas producer, said on Monday it was
selling its properties in Wyoming's Jonah natural gas field to
an arm of private equity firm TPG Capital for $1.8
billion, as part of a plan to shed assets and concentrate its
The sale includes properties producing about 323 million
cubic feet of gas per day, about 12 percent of Encana's natural
gas output in 2013, 1.5 trillion cubic feet of reserves, 24,000
acres of developed lands and 100,000 acres of exploration lands
near the Jonah field called the Normally Pressured Lance area.
The sale is Encana's latest under Chief Executive Doug
Suttles, who is restructuring the company to cut its dependence
on low-value natural gas and focus on five shale fields with
reserves high in oil and valuable natural-gas liquids.
"With the divestment of Jonah, we are unlocking value from a
mature, high-quality asset and allowing our teams to focus on
our five core growth areas and continue with execution of our
new strategy," Suttles said in a statement.
The company said proceeds will be used for normal corporate
purposes, including debt reduction, acquisitions and capital
Part of Encana's Jonah lands were included in a $250 million
joint-venture agreement signed in 2011 with Northwest Natural
Gas Co, a Portland, Oregon-based gas distributor.
Northwest said in a statement it has renegotiated its agreement
with Encana and will retain ownership of some Jonah reserves.
Northwest will no longer drill wells in the field but has
the right to participate in some future wells with TPG under a
joint operating agreement.
Encana is focusing on five shale fields - Montney in British
Columbia, Duvernay in Alberta, the DJ Basin in Colorado, the San
Juan Basin in U.S. Southwest, and the Tuscaloosa Marine Shale in
Evercore and Davis Graham & Stubbs LLP advised Encana on the
deal, while Vinson & Elkins LLP was TPG's adviser.
Encana's shares were down 13 Canadian cents to C$23.57 by
late morning on the Toronto Stock Exchange.
(Additional reporting by Swetha Gopinath in Bangalore; Editing
by Paul Simao)