Encana makes $1.8bn Bighorn sale

Canada’s Encana has agreed to sell its Bighorn gas assets in Alberta to compatriot Jupiter Resources for C$2 billion ($1.8 billion).

Chief executive Doug Suttles said the sale was aimed at “unlocking value from our portfolio as we focus on developing our core growth plays and extracting additional value from our base assets”.

Suttles added: “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, which had been rumoured to be in the works earlier this month, includes around 360,000 net acres of land with total net proved reserves of around 1100 billion cubic feet equivalent, three-quarters of which is gas.

Working interests in all pipelines, facilities and service arrangements are also part of the deal.

The properties produced 319 million cubic feet of equivalent after royalties in the first quarter.

Jupiter Resources chief executive Simon Bregazzi said that Bighorn was “one of North America’s premier liquids-rich natural gas projects in an area that has generated some of Canada’s most prolific well results in recent years”.

The Calgary-based private has the backing of funds managed by affiliates of Apollo Global Management.

The sale is expected to close in the third quarter subject to approvals and customary conditions.

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