Encana posts big loss, to split U.S. asset sale package

Encana posts $1.24-billion quarterly loss by The Canadian Press, October 24, 2012, Calgary Herald
Encana and other producers have been grappling with a North American oversupply of natural gas…. Since it spun off its oil and refinery assets into Cenovus Energy Inc. (TSX:CVE) in 2009, Encana has been focused exclusively on developing natural gas. With prices of that commodity remaining dismally low, Encana’s pure-play status has been particularly challenging. Encana has been looking at partnership deals, drilling for more lucrative natural gas liquids, tapping export markets and asset sales in order to get by in the gloomy market. It’s also a partner in a project to build a liquefied natural gas export terminal in the northern West Coast port of Kitimat, B.C. U.S. firms Apache Corp. and EOG Resources are also involved. … Encana launched an internal probe in June after allegations surfaced that it and a U.S. rival colluded to suppress land prices in Michigan. In September, Encana said its board of directors found no evidence the company and Chesapeake Energy discussed ways to avoid bidding against one another for land leases 2010. Probes by the U.S. Department of Justice and Michigan’s attorney general are ongoing and Encana says it’s co-operating. [Emphasis added]

Encana posts big loss, to split U.S. asset sale package by Thyagaraju Adinarayan and Scott Haggett; Editing by Sreejiraj Eluvangal and Peter Galloway, October 24, 2012, Reuters
The company, which posted a big third-quarter loss on $1.19 billion in noncash charges on Wednesday, said it has opted to split its Eaglebine, Tuscaloosa Marine Shale and Mississipian Lime properties into three separate investment packages rather than trying to find a single partner to develop them. “There are significant assets available for joint venture in both the Canadian and U.S. marketplace,” Randy Eresman, the company’s chief executive, said on a conference call. “We’ve been advised that a combined Tuscaloosa Marine Shale, Eaglebine and Mississipian Lime package may be too large for most interested parties at this time. So we are allowing the plays to be bid on individually.” … The company reported a net loss of $1.24 billion, or $1.69 a share, for the third quarter, compared with a profit of $459 million, or 62 cents a share, in the year-before period. … Encana faces investigations by U.S. federal and Michigan state authorities over allegations that it colluded with Chesapeake Energy Corp to lower the cost of land over a promising shale oil and gas field in Michigan. It did not comment on the state of the investigations on Wednesday. [Emphasis added]

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