Canadian gas giant Encana Corp has signed a deal which will net the company US$ 2.9 billion from Mitsubishi Corp in exchange for a 40% share in the Cutbank ridge partnership.
The Cutbank ridge partnership controls approximately 409,000 acres of undeveloped gas lands owned by Encana. Mitsubishi’s first move will be to spend C$ 1.45 billion on development in the region, with an additional C$ 1.45 billion to be set aside for future capex in the field.
Encana was keen to make it clear that “This transaction does not include any of Encana’s current Cutbank Ridge production of about 600 million ft3 of natural gas per day, processing plants, gathering systmems or Encana’s Alberta landholdings.”
The company went on to claim that the lands held by the partnership had “proven undeveloped reserves of approximately 900 billion ft3 of natural gas equivalent.”
This most recent sale and others made by Encana in North America have been attributed to low natural gas prices.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/17022012/encana_in_cutbank_ridge_deal/