CALGARY – Encana Corp. says it will issue up to 107 million new common shares in a public offering designed to allow it to put more rigs to work in a promising Texas oilfield.
After markets closed Monday, the Calgary-based producer said the offering, underwritten by Credit Suisse Securities (Canada), Inc. and J.P. Morgan, was priced at US$9.35 per share.
That means it would raise just more than US$1 billion.
It would also increase Encana’s (TSX:ECA) share total by nearly 13 per cent.
Encana said it will put about half of the funds on its 2017 capital budget. The company said it will double the number of wells it has in the Permian oilfield of Texas by the end of the year by increasing the number of drilling rigs it employs there.
The remaining proceeds from the share sale are to be used to repay debt.
The underwriters will have a 30-day option to purchase just over 16 million more shares, Encana said.
Note to readers: This is a corrected story. A previous version said the issuing of shares would raise under US$1 billion and that Encana’s closing stock price was US$9.35.