CALGARY, Alberta, Aug. 25 (UPI) -- In an effort to cut debt, Canadian energy company Encana Corp. said Tuesday it was selling its shale natural gas assets in Louisiana for $850 million.
Encana said it was unloading its assets in the Haynesville shale basin to GEP Haynesville, LLC, a joint venture formed by fund manager GSO Capital Partners and GeoSouthern Haynesville. The Canadian company said it would use the cash from the sale, as well as savings from the footprint reduction, to cut debt.
"By further focusing our portfolio, we are making Encana more efficient as we proceed through the second half of 2015 and into 2016," Encana President and Chief Executive Officer Doug Suttles said in a statement. "This transaction delivers significant proceeds that we'll use to strengthen our balance sheet."
Encana in February said it was reducing its capital investment plans for the year by $700 million to about $2.1 billion. About 80 percent of new spending would target the four key U.S. shale basins outside of Haynesville.
Second quarter production for Encana increased more than 5 percent from the previous quarter, driven in large part by the Permian and Eagle Ford basins in Texas.
In July, the Canadian company said it was basing its future growth expectations on oil priced at $50 per barrel for West Texas Intermediate, the U.S. benchmark. WTI traded Tuesday below $40 per barrel.