Penn West Petroleum Ltd (PWT.TO) (PWE.N), one of Canada's biggest conventional oil producers, said it aimed to sell up to $2 billion of assets before 2015 as part of a plan to focus on projects centered on the Cardium field in Alberta.
Struggling with weak gas prices, Penn West has undertaken a series of steps, including layoffs and a dividend cut, since June when former Marathon Oil (MRO.N) executive David Roberts was appointed chief executive.
Penn West said on Wednesday it would focus on light-oil projects in Alberta's Cardium, Viking and Slave Point fields as it strived to increase production of liquids to about 80 percent of total output by 2018.
Penn West's shares were down 3.3 percent at C$11.25 in early trading on the Toronto Stock Exchange.
The company has already lined up buyers for about $485 million of assets in deals expected to close before the end of the year, Penn West said.
Penn West also trimmed the high end of its output forecast for 2013, saying in now expected to produce 135,000 to 137,000 barrels of oil equivalent (boe) per day, compared with its earlier estimate of 135,000-145,000.
Average daily production in 2014 is expected to be 105,000-110,000 boe, the majority being oil and natural gas liquids, Penn West said.
Encana Corp (ECA.TO), Canada's largest natural gas producer, said on Tuesday it would cut about 20 percent of its workforce, slash its dividend, and focus future spending on just five regions rich in oil and gas liquids.
Penn West said its capital budget for 2014 would be $900 million, 40 percent of which would be spent on Cadmium. The budget for this year could be below its previous estimate of $900 million, the company said.
Penn West reported a net profit of C$27 million ($25.9 million), or 6 Canadian cents per share, for the third quarter, compared with a loss of C$67 million, or 14 Canadian cents per share, a year earlier.
Penn West shares have hardly budged over the past 12 months. The Toronto exchange's main energy index has risen 3.7 percent in the same period. ($1 = 1.0447 Canadian dollars)
(Reporting by Scott Haggett and Garima Goel; Editing by Saumyadeb Chakrabarty, Maju Samuel and Ted Kerr)