Encana Follows Other Canadian Majors in Foreign Spending Spree
Calgary-based Encana Corporation “is done its transition to a more disciplined company and ready for major growth,” JWN Energy reports, citing remarks by the gas giant’s president and CEO Doug Suttles to investors last week in New York.
The company plans to spend up to $1.8 billion next year to expand production—aiming to increase it by 60% by 2021. At least $850 million and as much as $1 billion of that will go to develop Encana properties in Texas’ Permian Basin. According to Suttles, Encana’s profitability will allow it to fund its development program from cash flow by 2018.
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The company’s moves abroad follow in the footsteps of two other giants of the Canadian oilpatch and downstream fossil sector.
In August, TransCanada Corporation, whose $US12-billion Energy East pipeline is bogged down in controversy and a stalled regulatory process, signed a US$800-million partnership with Sierra Oil and Gas and Mexico’s Grupo TMM to build a 265-kilometre pipeline from a location near Mexico City to the Gulf of Mexico. Last month, it offered US$848 million in cash to complete its acquisition of Columbia Pipeline Partners, “strengthening its grip on a pipeline network that stretches from New York to the Gulf of Mexico,” Business News Network reported.
Early last month, as well, Enbridge announced a $37-billion all-share acquisition of Houston-based Spectra Energy Corporation that will make it North America’s biggest energy infrastructure company.