CPP Investment Board (CPPIB) and The Broe Group have formed a joint venture to buy oil and gas assets in Colorado from Encana for US$900 million.
The deal includes 51,000 acres of land in northeastern Colorado in the Denver Julesburg (DJ) Basin.
During the first half of 2015, the assets produced an average of 52 million cubic feet per day of natural gas and 14,800 barrels per day of crude oil and natural gas liquids.
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“The DJ Basin is one of the leading oil and natural gas plays in North America and Encana’s assets and operations have long been regarded as top-tier by industry standards,” says Avik Dey, managing director, head of Natural Resources, CPPIB. “This investment offers attractive economics and aligns well with our strategy for the energy sector.”
CPPIB will own a 95% interest in the entity and The Broe Group will own a 5% interest.
The transaction is subject to customary regulatory approvals and closing conditions and is expected to close in the fourth quarter of 2015.
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