Deal insight

Encana makes decisive move into tight oil with US$3.1 bn Eagle Ford deal

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Report summary

Encana is to acquire 45,500 net acres in the core of the Eagle Ford for US$3.1 billion. Freeport-McMoRan Copper & Gold (FCX) is the seller. The acreage lies primarily in the Karnes Trough sub-play, at the core of this leading tight oil play. Current production is 53,000 boe/d (75% oil, 11% NGL and 14% gas), and we model a further 300 drilling locations. We value the portfolio at US$3.9 billion (NPV10, discounted to April 2014).

What's included

This report contains

  • Document

    Encana makes decisive move into tight oil with US$3.1 bn Eagle Ford deal

    PDF 938.43 KB

Table of contents

  • Executive summary
  • Transaction details
  • Upstream assets
    • Modelling assumptions
    • Precedent transactions
    • Operational efficiency
    • Downspacing
    • Additional potential horizons
    • Liquids price
    • Encana
    • Freeport-McMoRan Copper & Gold
  • Oil & gas pricing and assumptions

Tables and charts

This report includes 10 images and tables including:

Images

  • Executive summary: Image 1
  • Karnes Trough sub-play wells: average IP30 rates by operator
  • FCX Eagle Ford acreage

Tables

  • Upstream assets: Table 1
  • Oil & gas pricing and assumptions: Table 1
  • Oil & gas pricing and assumptions: Table 2
  • Deal analysis: Table 1
  • Deal analysis: Table 2
  • Deal analysis: Table 3
  • Deal analysis: Table 4

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