ENCANA TO BUY EXPLORATION CO. LANDS IN TEXAS FOR US$80M

EnCana Corp., Canada’s largest company by market value, agreed to buy southwest Texas land stakes from Exploration Co. for US$80-million to boost onshore natural- gas reserves. The purchase includes about 3% of reserves and 20% of production at Exploration Co., the San Antonio-based seller said yesterday in a statement. Calgarybased EnCana will acquire interests in about 670,000 acres in the Maverick Basin block of southwest Texas, Exploration Co. said. EnCana is expanding land holdings in North America as the company tightens its focus on large, underground gas deposits that were deemed too difficult and expensive to tap before fuel prices soared. Exploration Co., which expects to close the sale by Sept. 30, said it will use proceeds to reduce debt and buy back preferred stock. EnCana has sold or agreed to sell more than US$5-billion worth of assets in Ecuador, the U.K. and the Gulf of Mexico in the past year as chief executive Gwyn Morgan, pictured, focuses on what he calls “resource plays.” The company is drilling thousands of wells in Texas, Colorado, Wyoming and British Columbia, in some cases fracturing hundreds of

feet of rock. Advances in technology

and high prices

made such projects

viable. U.S. gas futures have more

than doubled in the

past year and last

week touched a

record high in New

York. Shares of En-

Cana, the largest producer of North American gas, fell 3¢ to $ 65.50 on Toronto Stock Exchange. Before yesterday, the stock had jumped 92% this year. Exploration Co. rose US22¢, or 4.2%, to US$5.47 on the Nasdaq Stock Market. EnCana spokesman Alan Boras said the company will fund the purchase from Exploration Co. with cash on hand. EnCana will drill a few wells to determine whether it can develop a resource play similar to projects the company has near Fort Worth and in eastern Texas, he said.