Encana Posts Large 2Q Loss on $1.7B Impairment Charge

Encana Corp. posted a hefty second-quarter net loss after recording a $1.7 billion non-cash, after-tax impairment charge mainly from the decline in natural-gas prices, and said further impairment charges are likely given the current pricing environment.

The Calgary, Alberta-based company, a major gas producer, said it lost $1.48 billion, or $2.01 a share, compared with a year-earlier profit of $383 million, or 52 cents.

It said operating earnings came in at 27 cents a share in the latest period. The Thomson Reuters mean estimate was for earnings of 19 cents a share.

Revenue tumbled to $731 million from $1.99 billion, and fell well below the $1.48 billion that analysts were expecting.

Encana said its commodity-price hedging program contributed to a realized natural gas price of $4.79 per thousand cubic feet during the quarter, keeping cash flow on track with its expectations for the year. Cash flow was $794 million in the quarter.

It said it's continuing to work on a strategic shift which targets accelerated development of oil and liquids-rich natural-gas plays.

Encana also said it opened data rooms during the quarter for three investment opportunities with respect to its Alberta Duvernay asset, a group of U.S. liquids-rich plays and an about 10% stake in the Cutbank Ridge Partnership. It said Wednesday there has been "strong interest" from potential partners.

Copyright (c) 2012 Dow Jones & Company, Inc.


Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies

Our Privacy Pledge

Most Popular Articles

From the Career Center
Jobs that may interest you
United States Houston: Account Rep, Bus Dev, Sr
Expertise: Business Development|Sales
Location: Houston, TX
Business Development Manager
Expertise: Business Development|Construction Manager|Sales
Location: Tempe, AZ
SXL- Manager, Business Development
Expertise: Business Development
Location: Newtown Square, PA
search for more jobs

Brent Crude Oil : $49.98/BBL 1.59%
Light Crude Oil : $49.18/BBL 1.56%
Natural Gas : $2.73/MMBtu 1.44%
Updated in last 24 hours