UPDATE 1-Canada's Encana to sell Haynesville natgas assets for $850 mln

Tue Aug 25, 2015 6:59am EDT
 
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(Adds details from statement, background)

Aug 25 (Reuters) - Canadian oil and gas producer Encana Corp said on Tuesday it will sell its Haynesville natural gas assets in northern Louisiana for $850 million to GEP Haynesville LLC.

Encana also said it will reduce its gathering and midstream investments by about $480 million on an undiscounted basis by 2020.

Under Chief Executive Doug Suttles, Encana has been focusing on transforming into a major oil producer by concentrating spending on regions rich in high-value gas liquids and oil and selling off natural gas assets.

The company has said it plans to invest in oil-rich shale fields of Permian, Eagle Ford, Duvernay and Montney in 2015.

GEP Haynesville LLC is a joint venture between GeoSouthern Haynesville LP and funds managed by GSO Capital Partners LP.

GSO Capital Partners, a unit of Blackstone Group LP, is a credit-focused alternative asset management firm.

Encana will transport and market GeoSouthern's Haynesville production on a fee for service basis for the next five years, the company said.

The Haynesville natural gas assets include about 112,000 net acres of leasehold, plus additional fee mineral lands.   Continued...