* Sale of Canadian, Colombian assets still on track
* Shares up 4 pct on better-than-expected results
SAN FRANCISCO, Oct 27 (Reuters) - Nabors Industries Ltd (NBR.N) said on Wednesday a planned initial public offering of oil and gas joint venture NFR Energy was not feasible at current U.S. gas prices, which the CEO said were "horrible."
Nabors, the world's largest land-rig contractor, had been planning to float NFR, a $1 billion JV with private equity firm First Reserve Corp that has been buying U.S. oil and gas acreage since 2006, by the first half of 2011.
Nabors Chief Executive Gene Isenberg said NFR was showing a profit thanks largely to its good hedging program, and the company continued to contemplate and prepare for an IPO.
"(But) it won't be feasible until the gas price gets better, I don't know how much better," Isenberg told investors on a conference call to discuss Nabors' third-quarter results, adding that the current natural gas price was "horrible."
He said the ratio between oil and gas prices looked more likely to contract than expand, which could be helped by some catalyst to drive up natural gas prices such as the U.S. Environmental Protection Agency tightening regulations that would prompt more utilities to switch away from burning coal.
"Maybe in our business you've got to be optimistic," said Isenberg, 80, who over the past three years took home a total of $147 million in salary and bonus. "But I'm not still personally buying any gas futures."
Nabors shares rose nearly 5 percent on Wednesday after the company reported a better-than-expected rise in quarterly profits before one-time items. [ID:nN26166308]
Isenberg said on the call that the impact of the Gulf of Mexico oil spill and moratorium on its offshore operations likely added up to about $36 million for all of 2010.
Including the NFR IPO and planned sales of exploration and production assets in Colombia and Canada, Nabors aimed to raise about $2 billion, using some of it to pay down debt piled up with its acquisition last month of Superior Well Services.
The company has heard from more potential buyers than it anticipated for those assets, and Isenberg said the Colombia assets were very likely to be sold by the end of this year.
He has said before that international gas companies were likely buyers of its assets in the British Columbia shale, naming Korea Gas Corp (036460.KS), Britain's BG Group Plc BG.L and Japanese trading companies as possibilities.
Shares of Bermuda-based Nabors were up 4.1 percent at $20.23 on the New York Stock Exchange on Wednesday afternoon. The stock is still down 7 percent so far in 2010, compared with an 8 percent rise for the Philadelphia Stock Exchange oil service index .OSX. (Reporting by Braden Reddall, editing by Matthew Lewis)