Encana Oil & Gas (USA) Inc. completed its acquisition of about 45,500 net acres in Atascosa, Karnes and Wilson counties in South Texas from Freeport-McMoRan, Encana Corp. (TO: ECA.TO, NYSE: ECA) said June 20.
The transaction was worth $3.1 billion, Encana Corp. said.
The Eagle Ford acreage produced about 53,000 barrels of oil equivalent per day in the first quarter of 2014, Encana Corp. said, noting that the area might have more than 400 drilling locations.
The deal will benefit the year’s cash flow, Encana Corp. said, adding that it nearly doubles the company’s current oil production and supports its commodity portfolio. The transaction’s effective date was April 1, the company said. Scotia Waterous advised Encana on the deal, according to a May 7 press release from Encana Corp.
"This acquisition fully aligns with the strategy we announced last November; it will significantly boost our oil and liquids output, improve cash flow and enhance our portfolio of world class resource plays," said Doug Suttles, Encana Corp.’s president and CEO.
Additionally, Encana Oil & Gas, the company’s wholly owned subsidiary, also closed on most of the properties it sold in Leon and Robinson counties in East Texas, Encana Corp. noted.
The subsidiary has received about $427 million, and the total anticipated purchase price is about $530 million, Encana Corp. said. The whole transaction is scheduled to close in this year’s third quarter, the company added.
Calgary, Alberta-based Encana Corp. produces natural gas, oil and NGL across North America.
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