Encana Corp. has agreed to sell the majority of its Clearwater coalbed methane assets (CBM) in Alberta, Canada, to Ember Resources Inc. for US$541 million.
Ember is set to acquire 1.2 million net acres and more than 6800 producing wells. The assets yielded 180 million ft3/day of gas-equivalent in 2Q14.
The purchase increases Ember's total land position in the Horsehoe Canyon CBM fairway to 2.2 million net acres, and raises combined gross production to 290 million ft3/day.
Ember, based in Calgary, specialises in CBM.
“This acquisition establishes Ember as the leading producer of coalbed methane in Canada,” said Doug Dafoe, Ember President and CEO. “This is an exciting time for our company and we look forward to working with the talented team that has made Encana successful in this area for so many years.”
Encana will retain 1.1 million net acres in Clearwater, including 480,000 net acres along the eastern edge of the Horseshoe Canyon fairway.
The sale advances Encana's plan to deemphasise gas production in favour of increasing output of more-lucrative oil and NGL.
"We are unlocking additional value from non-core dry gas assets as we focus on liquids rich growth areas," said Doug Suttles, president and CEO of Encana.
In recent months, traditionally gas-weighted Encana has acquired leasehold in the oil-rich Eagle Ford shale and Permian basin.
The sale to Ember is expected to close in the 1Q15, pending regulatory approval.
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/cbm/15122014/encana-corp-will-sell-coalbed-methane-assets-cbm169/