CALGARY — Bonavista Energy Trust (TSX:BNP.UN) is buying some of EnCana Corp.’s (TSX:ECA) Central Alberta natural gas properties for $694 million.
“It fits like a glove,” said Bonavista chief executive officer Keith MacPhail in an interview.
“The opportunity dovetails in with the single largest area in play that we’re working on in Central Alberta” at Willesden Green, southwest of Edmonton.
In a separate release, EnCana, Canada’s biggest natural gas producer, said the parcel includes about 165,500 net hectares with current production of about 60 million cubic feet equivalent per day after royalties.
The properties are located west of Red Deer, between Caroline nd Pigeon Lake.
“This sale reflects our ongoing efforts to high-grade our portfolio of producing assets and it represents a substantial portion of our 2009 divestitures target of between US$500 million and $1 billion,” stated EnCana CEO Randy Eresman.
“We continue to look for other opportunities for divestiture and acquisitions to improve the long-term value creation capacity of our extensive North American unconventional resource portfolio.”
The deal is slated to close Aug. 21.
Bonavista said the acquired assets are in an area that has significant exposure to the recently emerging resource plays in the Glauconite, Rock Creek, Cardium, Viking and Notikewin formations of Central Alberta.