Debt-ridden oil producer Ovintiv to sell Eagle Ford assets for $880 million

(Reuters) – Debt-ridden Ovintiv Inc said it had agreed to sell its Eagle Ford assets in Texas to Validus Energy for $880 million, as the oil and gas producer seeks to shore up its finances following a tumultuous year for the energy industry.

Ovintiv, formerly known as Encana, moved its headquarters from Canada to the United States last year in the hopes of better access to capital. But a crash in oil prices pushed away investors from the shale industry and forced companies to look at asset sales and mergers for survival.

Reuters had exclusively reported in November that Ovintiv was looking to sell its Eagle Ford acreage.

Ovintiv said on Wednesday, with the sale, the company has exceeded its divesture target and anticipates year-end 2021 debt to be below $5 billion.

It also expects to achieve its $4.5 billion debt target in the first half of 2022.

Ovintiv said the winter storms in Texas and Oklahoma only impacted the first quarter, and it expects crude and condensate volumes to average in the range of 196,000 – 200,000 thousand barrels (MBbls) of oil per day.

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