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Encana subsidiary completes C$165M sale of Arkoma Basin gas assets

Encana Corp. subsidiary Newfield Exploration Mid-Continent Inc. completed the divestment of its natural gas assets in the Arkoma Basin in Oklahoma to an unnamed buyer for C$165 million.

The Arkoma assets comprised about 140,000 net acres of leasehold and roughly 77 MMcfe/d of production, of which 98% is natural gas, according to an Aug. 27 news release. Newfield Exploration Mid-Continent is a subsidiary of Newfield Exploration Co., which Encana purchased in a US$5.5 billion deal in February.

Encana plans to use the proceeds from the transaction to cut its debt. Following the deal closing, the company's full year pro forma production guidance was unchanged at 560,000 barrels of oil equivalent per day to 600,000 boe/d. Encana is engaged in the exploration and production of oil, gas and NGLs, with assets in shale plays that include the Montney and Duvernay shales in British Columbia and Alberta.

CIBC Griffis & Small provided advisory services to Encana, and Davis Graham & Stubbs LLP was legal counsel.