Encana Posts Hefty 3Q Loss on $1.2B Charge

Encana Corp. said Wednesday it took a hefty third-quarter impairment charge as a result of low natural-gas prices, its second such charge in as many quarters, resulting in a $1.24 billion net loss for the period.

The natural gas-focused company, based in Calgary, Alberta, recorded a $1.19 billion non-cash impairment charge in the latest quarter, again marking down the value of its natural-gas assets as prices dipped. It took a similar charge in the second quarter.

Encana said third-quarter operating earnings, which exclude the impairment charge and other items, fell to $263 million, or 36 cents a share, from $389 million, or 53 cents a share. Results beat the Thomson Reuters mean estimate for a profit of 26 cents a share.

Encana said natural-gas prices hit their lowest levels in a decade during the first half of the year, leading it to shut in or curtail about 500 million cubic feet a day of production.

The company's third-quarter production averaged 2.9 billion cubic feet a day of natural gas, down 14% from a year earlier, due partly to voluntary capacity reductions. It said production volumes have now been restored and it expects to meet its full-year guidance for production of 3 billion cubic feet a day.

Encana said its realized natural gas prices in the latest quarter totaled $4.91 per thousand cubic feet, down from $5.01 a year earlier.

Cash flow of $913 million, or $1.24 a share, was down from $1.18 billion, or $1.60 a year earlier.

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 : $50.47/BBL 0.98%
Light Crude Oil : $49.72/BBL 1.09%
Natural Gas : $2.76/MMBtu 1.09%
Updated in last 24 hours