Boston, MA 05\/08\/2014 (wallstreetpr) \u2013\u00a0The leading Canadian natural gas producer Encana Corporation (USA) (NYSE:ECA)<\/b> recently announced plans to acquire more shale land to improve its oil production. However, the CEO Doug Suttles made a clarification that is worth taking note.<\/p>\n
\u00a0The CEO said that while the company is keen on doubling oil output with the announced $3.1 billion deal with Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX)<\/b> in Texas, earlier laid out investment plans will not be altered. It was important the CEO made that point known to investors to allay fears that the company might be negating from earlier stated stance.<\/p>\n
\u00a0Furthermore, the clarification also serves to show investors that financing the property acquisition from Freeport-McMoRan will not lead to debt issuance or share dilution. The company made it clear that the move to double crude oil production by acquiring property in the oil-rich Eagle Ford Shale is in the best interest of the shareholders. As such, the company plans to fund the acquisition with its cash and the proceeds from the previously declared transactions. The transactions include divestment of certain natural gas assets as the company shifts to focus more on crude oil production.<\/p>\n
Shift in strategy<\/b><\/p>\n
In addition to the Texas shale deal, Encana Corporation (USA) (NYSE:ECA) is considering other acquisition opportunities that can complement its powerful and ambitious switch of strategy from natural gas to crude oil.\u00a0 The Freeport-McMoRan deal that will give Encana about 45,500 net acres will close later in 2Q2014.<\/p>\n
Core play<\/b><\/p>\n
The purchase of the shale property in Texas will not only lend support to Encana Corporation (USA) (NYSE:ECA)\u2019s efforts to significantly boost oil output to create value for the shareholders, but will also bring the company\u2019s core play to six. The Eagle Ford land purchase will be in Atascosa and, Wilson and Karnes counties of south Texas. The property produced 53,000 barrels per-day of oil equivalent.<\/p>\n
Encana Corporation (USA) (NYSE:ECA) has five other key plays at Duvernay in Alberta, Montney in British Columbia, San Juan Basin in the U.S. Southwest, Tuscaloosa Marine Shale in the U.S. South and DJ Basin in Colorado.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 05\/08\/2014 (wallstreetpr) \u2013\u00a0The leading Canadian natural gas producer Encana Corporation (USA) (NYSE:ECA) recently announced plans to acquire more shale land to improve its […]<\/p>\n","protected":false},"author":12,"featured_media":18637,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[2236],"tags":[4493,2174,704,950],"stock_ticker":[],"class_list":["post-21553","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-encana-corporation-usa-nyseeca","tag-freeport-mcmoran-copper-gold-inc-nysefcx","tag-nyseeca","tag-nysefcx","entry"],"acf":[],"yoast_head":"\n