Dec 14 (Reuters) – Canadian oil and natural gas producer Encana Corp , responding to a sharp drop in oil prices, has cut its 2016 capital budget by more than a quarter to $1.5-$1.7 billion.
The company in November said it expected total capital spending of $2.2 billion this year.
The Calgary-based oil producer, which has accelerated its spending in the Permian basin in Texas, said it would direct about half of its capital budget for the next year to Permian.
Brent prices fell below 7 year lows sinking to $38 a barrel on Monday, on growing fears that the global oil glut would worsen in the coming months.
Encana said on Monday it expected to produce an average 340,000-370,00 barrels of oil equivalent per day (boepd) in 2016. Of this, the company's core assets would produce an average 260,000-280,000 (boepd).
The company's four core assets are in Permian and Eagle Ford shale fields in Texas and Montney and Duvernay shale fields in western Canada.
(Reporting by Anet Josline Pinto in Bengaluru; Editing by Ted Kerr and Shounak Dasgupta)
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