Encana makes 'bold' move on Texas shale

CALGARY, Alberta, May 7 (UPI) -- Canadian energy company Encana said Wednesday it will pay around $3.1 billion to acquire acreage at the center of the Eagle Ford shale basin in Texas.

"Gaining a position in a world class, oil-rich resource play like the Eagle Ford accelerates the transition of our portfolio and underscores our investment focus on high margin assets," Encana President and Chief Executive Officer Doug Suttles said in a statement.

Encana's subsidiary, Encana Oil & Gas U.S.A. Inc., announced it acquired 45,500 acres of land in Texas from Freeport-McMoRan. Encana said the acreage produced around 53,000 barrels of oil equivalent per day during the first quarter of the year.

The Canadian company says the deal, which it described as a "bold strategic move," will almost double its current oil production capacity.

The U.S. Energy Information Administration said in an April report on Eagle Ford the shale basin in Texas saw oil production increase by 31,000 barrels per day from March.