"This transaction advances our strategy by unlocking value from our portfolio as we focus on developing our core growth plays and extracting additional value from our base assets," says Doug Suttles, Encana President & CEO. "Bighorn is a high quality asset that has not been receiving significant investment in 2014. Going forward, it should serve as an excellent foundational asset for Jupiter Resources."
The sale includes approximately 360,000 net acres of land along with Encana's working interests in all pipelines, facilities and service arrangements. Total net proved reserves at the end of 2013 (on an SEC basis) were approximately 1,100 billion cubic feet equivalent (Bcfe), with about three quarters of those reserves being natural gas.
The transaction is subject to satisfaction of normal closing conditions, as well as regulatory approvals, and is expected to close by the end of the third quarter of 2014 with an effective date of May 1, 2014. RBC Capital Markets and Burnet, Duckworth & Palmer LLP acted as financial and legal advisors, respectively, to Encana on this transaction.
Encana plans to update its 2014 guidance, which will consider the impact of all completed transactions to date, in conjunction with the announcement of its second quarter earnings on July 24, 2014.