Encana Corp. (TSX:ECA) (NYSE:ECA) reports that its wholly owned subsidiary, Encana Oil & Gas (USA) Inc., has reached an agreement with an affiliate of TPG Capital to sell certain natural gas properties in the Jonah field located in Sublette County, Wyoming, for a purchase price of $1.8 billion.
Encana's Jonah field comprises a total productive area of about 24,000 acres and over 1,500 active wells. Estimated year-end 2013 proved reserves for Jonah totaled 1,493 billion cubic feet equivalent (Bcfe). The transaction also includes over 100,000 undeveloped acres adjacent to Jonah known as the Normally Pressured Lance (NPL) area.
The buyer expects to retain the employees currently working in connection with the Jonah field and plans to continue investment in the field and adjacent acreage, which will assist in supporting local employment in the area.
"We look forward to working with the talented Encana team that has made Jonah a successful operation for many years," said Craig Manaugh, president and COO of the new TPG oil and gas platform. "We are also pleased to announce that we will be maintaining the Jonah field office near Pinedale, Wyoming, and opening a Denver, Colorado, office as a result of the transaction."
The sale of Encana's Jonah assets is expected to close in the second quarter of 2014 with an effective date of Dec. 1, 2013. Evercore and Davis Graham & Stubbs LLP advised Encana on this transaction. Vinson & Elkins LLP advised TPG on the transaction.