CALGARY — Encana Corp. (TSX:ECA) is exiting Louisiana through a proposed deal worth more than US$1.2 billion in cash and savings.
The Calgary-based oil and gas producer will receive US$850 million cash and reduce its commitments by about US$480 million through the sale of its Haynesville natural gas assets in northern Louisiana, under an agreement announced Tuesday.
The buyer is GEP Haynesville LLC (GeoSouthern), a joint venture formed by GeoSouthern Haynesville LP and funds managed by GSO Capital Partners LP.
Encana will transport and market GeoSouthern's Haynesville production on a fee for service basis for the next five years.
It has been sharpening its focus on four strategic areas — two in the southern United States and two in Western Canada.
"This is another step in advancing our strategy," Encana president and CEO Doug Suttles said in a statement.
"By further focusing our portfolio, we are making Encana more efficient as we proceed through the second half of 2015 and into 2016."
The Haynesville deal is expected to close in the fourth quarter and become effective Jan. 1, after certain conditions are met.
The Canadian Press