•  
  •  
  •  
  •  
  •  
  • Untitled Document
    Untitled Document

    Encana's C$2.9B Cutbank Ridge deal dominates

    Echoing last month's large deals, the largest deal of the 30-day period from mid-January to mid-February involves an Asian company and a North American unconventional play. This month saw Encana Corp. agree to sell a 40% interest in its Cutbank Ridge Partnership to Japanese global integrated business enterprise Mitsubishi Corp. for roughly C$2.9 billion. The Partnership holds about 409,000 net acres of Encana's undeveloped Montney-formation natural gas lands in the company's Cutbank Ridge resource play in northeast British Columbia.

    The deal fills the void left last year after a $5.4 billion deal by PetroChina to acquire a 50% interest in Encana's Montney shale play asset fell through following a breakdown on terms. This new deal is different in that Mitsubishi will be acquiring a 40% interest in just a portion of the undeveloped acreage, containing 409,000 acres and no production, for C$2.9 billion.

    According to Evaluate Energy's new Shale database, the deal will make Mitsubishi the top Asian acreage holder in the play with 163,600 net acres, ahead of KOGAS with 129,000 net acres and Petronas with approximately 75,000 net acres.

    "The deal is a coup for Encana who have replaced one deal that included producing assets, pipelines and storage facilities for $7,700 per acre (unadjusted), with one that only includes undeveloped acreage for C$17,700 per acre," said Evaluate Energy's Eoin Coyne in a report to OGFJ.

    In another large deal, Apache Corp. agreed to acquire Cordillera Energy Partners III LLC, a privately held company with substantial operations that include approximately 254,000 net acres in the Granite Wash, Tonkawa, Cleveland and Marmaton plays in western Oklahoma and the Texas Panhandle, for $2.85 billion.

    The sellers, including EnCap Investments, other institutional investors and Cordillera management will receive approximately $600 million in Apache common stock subject to customary lock-up provisions. The balance of the consideration, $2.25 billion, will be funded with debt.

    Apache Corp. has expanded on its reputation as a company who can acquire mature assets and extract previously unforeseen value to also include the acquisition of early stage shale resources, noted Coyne. Apache's deal with Cordillera is a "healthy blend of these two strategies. Cordillera owns 254,000 acres in the liquids fairway of the Anadarko basin, an area in which Apache has operated in for over 50 years. The Granite Wash amongst other plays being acquired has several different target zones at differing depths. The conventional zones have a long history of production, but other tight zones which although not technically shale resources, have been opened up by the advances made in horizontal drilling and fracing technologies," he continued.

    More Oil & Gas Financial Journal Current Issue Articles
    More Oil & Gas Financial Journal Archives Issue Articles
    View Oil and Gas Articles on PennEnergy.com

    Most Popular

    Related Articles

    Apache completes sale of Australian operations

    06/08/2015 Apache Corp. has completed the sale of its Australian subsidiary Apache Energy Ltd. to a consortium of private equity funds managed by Macquarie Corporate Holdings Ltd. and Brookfield Asset Managem...

    Apache restructures organization and makes key leadership changes

    06/01/2015

    Apache Corp. is reorganizing its operating regions and making key leadership changes, the company said June 1.

    Apache appoints Rabun to board of directors

    05/14/2015

    Apache Corp. has appointed Daniel W. Rabun to its board of directors.

    Apache completes sale of Kitimat LNG

    04/10/2015 Apache Corp. has completed its sale of its 50% interest in the Kitimat LNG project and related upstream acreage in the Horn River and Liard natural gas basins in British Columbia, Canada, to Woodsi...

    Drastic industry changes

    04/09/2015

    As complexity grows, oil and gas companies must focus on capabilities and flexibility

    Apache agrees to sell Australian operations for $2.1 billion

    04/08/2015 Apache Corp. has an agreement to sell its Australian subsidiary Apache Energy Ltd. to a consortium of private equity funds managed by Macquarie Capital Group Ltd. and Brookfield Asset Management In...

    More Oil & Gas Financial Articles

    Apache completes sale of Australian operations

    Mon, Jun 8, 2015

    Apache Corp. has completed the sale of its Australian subsidiary Apache Energy Ltd. to a consortium of private equity funds managed by Macquarie Corporate Holdings Ltd. and Brookfield Asset Management Inc.

    Apache restructures organization and makes key leadership changes

    Mon, Jun 1, 2015

    Apache Corp. is reorganizing its operating regions and making key leadership changes, the company said June 1.

    Apache appoints Rabun to board of directors

    Thu, May 14, 2015

    Apache Corp. has appointed Daniel W. Rabun to its board of directors.

    Apache completes sale of Kitimat LNG

    Fri, Apr 10, 2015

    Apache Corp. has completed its sale of its 50% interest in the Kitimat LNG project and related upstream acreage in the Horn River and Liard natural gas basins in British Columbia, Canada, to Woodside Petroleum Ltd.

    Drastic industry changes

    Thu, Apr 9, 2015

    As complexity grows, oil and gas companies must focus on capabilities and flexibility

    OGFJ photo of the day


    Click to view slideshow

    Oil & Gas Jobs

    Search More Job Listings >>
    Subscribe to OGFJ