Encana Offering Expected To Raise Over $1B, Includes 107M New Shares

Calgary-based Encana Corp. says it will issue up to 107-million new common shares in an open offering intended to permit it to get more rigs to work in a promising Texas oilfield. The producer says the offering, guaranteed by Credit Suisse Securities (Canada), Inc. also, J.P. Morgan, was required to be valued after marketing.

At Monday’s closing cost of $13.03, it would raise just shy of $1.4 billion and increase Encana’s share total by about 13 percent.

Encana says it will put half of the funds into its 2017 capital budget.

The producer says it will double the number of wells it has in the Permian oilfield of Texas before the year’s over by expanding the number of drilling rigs it employs there. The rest of the proceeds from the share deal are to be utilized to repay debt. Encana says, the financiers will have a 30-day alternative to buy up to 16 million more shares.