Encana closes $3.1 billion Texas deal

Encana Oil & Gas Inc. (NYSE: ECA) (TSX: ECA) said Friday it completed a $3.1 billion acquisition announced by the company last month of approximately 45,500 net acres in south Texas from Freeport-McMoRan.

The acreage in the Eagle Ford shale produced approximately 53,000 barrels of oil equivalent per day in the first quarter of 2014 and has an estimated drilling inventory of more than 400 locations. Encana also drills oil and gas wells in Weld County.

The deal approximately doubles the company’s current oil production, enhancing the company’s efforts to balance its oil and natural-gas production. The transaction had an effective date of April 1.

The acquisition “will significantly boost our oil and liquids output, improve cash flow and enhance our portfolio of world-class resource plays,” Encana CEO Doug Suttles said in a statement.

Encana also said Friday that it closed on the majority of previously announced sale of property in east Texas. The company has received approximately $427 million of a total anticipated purchase price of approximately $530 million. The company expects to close the balance of the transaction in the third quarter of 2014.

Encana said it would update its estimated 2014 production when it announces of its second-quarter earnings on July 24.

Encana shares closed less than 1 percent down at $24.53.

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