Encana completes sale of non-core San Juan asset; reaffirms commitment to $1.25 billion share buyback in 2019
27 Dicembre 2018 - 11:00PM
TSX, NYSE: ECA Encana Corporation (Encana)
announced today that its wholly-owned subsidiary, Encana Oil &
Gas (USA) Inc., has completed the previously announced sale of its
San Juan asset in New Mexico to Denver-based DJR Energy.
“This transaction continues our track record of
unlocking value from non-core assets,” said Doug Suttles, Encana
President & CEO. “The proceeds from this sale add to our
financial strength and strongly support our commitment to our $1.25
billion share buyback and 25 percent increase to the dividend in
2019.”
Following the expected close of its announced
strategic combination with Newfield Exploration Company (Newfield),
Encana is committed to completing a $1.25 billion share buyback in
2019. Encana’s planned share buyback and previously announced 25
percent increase to its dividend following closing of the
transaction with Newfield, highlight the quality of its business
and commitment to return capital to shareholders.
The sale of Encana’s non-core San Juan asset
includes approximately 182,000 net acres and represents the
company’s total land position in the play. In 2017, the asset
delivered average production of approximately 5,400 barrels of oil
equivalent per day including 3,900 barrels per day of liquids. The
transaction has an effective date of April 1, 2018.
Encana’s planned share buyback is subject to
receipt of regulatory approvals, stock exchange rules and
securities laws and may be made through purchases in the open
market or other permitted means.
Encana CorporationEncana is a
leading North American energy producer that is focused on
developing its strong portfolio of resource plays, held directly
and indirectly through its subsidiaries, producing oil, natural gas
liquids (NGLs) and natural gas. By partnering with employees,
community organizations and other businesses, Encana contributes to
the strength and sustainability of the communities where it
operates. Encana common shares trade on the Toronto and New York
stock exchanges under the symbol ECA.
IMPORTANT INFORMATION FOR INVESTORS AND
SHAREHOLDERS - This communication is not intended to and
does not constitute an offer to sell or the solicitation of an
offer to subscribe for or buy or an invitation to purchase or
subscribe for any securities or the solicitation of any vote or
approval in any jurisdiction, nor shall there be any sale, issuance
or transfer of securities in any jurisdiction in contravention of
applicable law.
In connection with the proposed transaction
between Encana and Newfield, Encana has filed with the U.S.
Securities and Exchange Commission (the “SEC”) a registration
statement on Form S-4 that includes a preliminary Joint Proxy
Statement of Encana and Newfield that also constitutes a
preliminary Prospectus of Encana (the “Joint Proxy
Statement/Prospectus”). Encana and Newfield plan to mail to their
respective shareholders the definitive Joint Proxy
Statement/Prospectus in connection with the transaction. INVESTORS
AND SECURITY HOLDERS OF ENCANA AND NEWFIELD ARE URGED TO READ THE
JOINT PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED
OR TO BE FILED WITH THE SEC CAREFULLY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ENCANA,
NEWFIELD, THE TRANSACTION AND RELATED MATTERS. Investors and
security holders will be able to obtain free copies of the
definitive Joint Proxy Statement/Prospectus (when available) and
other documents filed with the SEC by Encana and Newfield through
the website maintained by the SEC at www.sec.gov. Investors will
also be able to obtain free copies of the definitive Joint Proxy
Statement/Prospectus (when available) and other documents filed
with Canadian securities regulatory authorities by Encana, through
the website maintained by the Canadian Securities Administrators at
www.sedar.com. In addition, investors and security holders will be
able to obtain free copies of the documents filed with the SEC and
Canadian securities regulatory authorities on Encana’s website at
www.encana.com or by contacting Encana’s Corporate Secretary.
Copies of the documents filed with the SEC by Newfield will be
available free of charge on Newfield’s website or by contacting
investor relations.
PARTICIPANTS IN THE MERGER SOLICITATION
- Encana, Newfield and certain of their respective
directors, executive officers and employees may be considered
participants in the solicitation of proxies in connection with the
proposed transaction. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the
solicitation of the shareholders of Encana and the stockholders of
Newfield in connection with the transaction, including a
description of their respective direct or indirect interests, by
security holdings or otherwise, will be included in the definitive
Joint Proxy Statement/Prospectus described above when it is filed
with the SEC and Canadian securities regulatory authorities.
Additional information regarding Encana’s directors and executive
officers is also included in Encana’s Notice of Annual Meeting of
Shareholders and 2018 Proxy Statement, which was filed with the SEC
and Canadian securities regulatory authorities on March 23, 2018,
and information regarding Newfield’s directors and executive
officers is also included in Newfield’s 2018 Proxy Statement, which
was filed with the SEC on March 29, 2018. These documents are
available free of charge as described above.
ADVISORY REGARDING OIL AND GAS
INFORMATION - The conversion of natural gas volumes to
barrels of oil equivalent (BOE) is on the basis of six thousand
cubic feet to one barrel. BOE is based on a generic energy
equivalency conversion method primarily applicable at the burner
tip and does not represent economic value equivalency at the
wellhead. Readers are cautioned that BOE may be misleading,
particularly if used in isolation.
ADVISORY REGARDING FORWARD-LOOKING
STATEMENTS - This communication contains certain
forward-looking statements or information (collectively, FLS)
within the meaning of applicable securities legislation, including
the United States Private Securities Litigation Reform Act of 1995.
FLS include: financial strength of the company; commitment to
capital returns to shareholders; timing of closing of the Newfield
transaction; expectation that closing conditions, including
shareholder approvals, will be satisfied; anticipated share buyback
following closing, receipt of regulatory approvals, timing of
completion, form of purchases and funding thereof; and planned
increase to dividend following closing. Readers are cautioned
against unduly relying on FLS which, by their nature, involve
numerous assumptions, risks and uncertainties that may cause such
statements not to occur, or results to differ materially from those
expressed or implied. These assumptions include: assumptions
contained in Encana’s corporate guidance and five-year plan;
ability to satisfy closing conditions, regulatory and shareholder
approvals; assumed number of issued and outstanding shares of
Encana and Newfield; future commodity prices and differentials;
data contained in key modeling statistics; effectiveness of
Encana's drive to productivity and efficiencies; results from
innovations; enforceability of transaction agreements; and
expectations and projections made in light of, and generally
consistent with, Encana's historical experience and its perception
of historical trends, including with respect to the pace of
technological development, benefits achieved and general industry
expectations. Risks and uncertainties that may affect these
business outcomes include: integration of Encana and Newfield;
ability to recognize anticipated benefits from the combination of
Encana and Newfield; ability to obtain required approvals for the
transaction and timing thereof; risk that the conditions to the
transaction are not satisfied on a timely basis or at all; risks
relating to the value of the Encana common shares to be issued in
connection with the transaction; disruption to Encana’s and
Newfield’s respective businesses as a result of the transaction;
variability and discretion of Encana's board of directors to
declare and pay dividends, if any; variability in the amount,
number of shares and timing of purchases, if any, under the share
buyback; commodity price volatility; counterparty and credit risk;
impact of a downgrade in a credit rating and access to sources of
liquidity; risks inherent in Encana’s corporate guidance and
five-year plan; failure to achieve cost and efficiency initiatives;
and other risks and uncertainties impacting Encana's business, as
described in its most recent Annual Report on Form 10-K and
Quarterly Report on Form 10-Q and as described from time to time in
Encana’s other periodic filings as filed on SEDAR and EDGAR.
Although Encana believes the expectations
represented by such FLS are reasonable, there can be no assurance
that such expectations will prove to be correct. Readers are
cautioned that the assumptions, risks and uncertainties referenced
above are not exhaustive. FLS are made as of the date of this news
release and, except as required by law, Encana undertakes no
obligation to update publicly or revise any FLS. FLS contained in
this news release are expressly qualified by these cautionary
statements.
Further information on Encana Corporation is
available on the company’s website, www.encana.com, or by
contacting:
Investor contact: |
Media contact: |
Corey
Code |
Simon
Scott |
Vice-President, Investor Relations |
Vice-President, Communications |
(403)
645-4606 |
(403)
645-2526 |
|
|
Patti
Posadowski |
Jay
Averill |
Sr.
Advisor, Investor Relations |
Director, External Communications |
(403) 645-2252 |
(403) 645-4747 |
SOURCE: Encana Corporation