The Successful Investor Hotline – Friday, September 12, 2014

Article Excerpt

ENCANA CORP., $24.89, Toronto symbol ECA, announced this week that it will sell its remaining 54% stake in PriarieSky Royalty Ltd. (Toronto symbol PSK) to a group of underwriters. The company recently set up PrairieSky as a new firm to hold its Clearwater properties in southern Alberta. PriarieSky owns the oil and natural gas rights to 5.2 million acres. It does not drill wells or explore for new reserves. Instead, it collects royalties from other oil and gas producers. Encana will receive $2.6 billion when it completes the sale later this month. That’s equal to 14% of its $18.6-billion market cap. The company will probably use the cash to keep expanding its oil and natural gas liquids operations, which cuts its exposure to weak gas prices. Encana recently paid $3.1 billion U.S. for shale oil wells in Texas’s Eagle Ford area. Encana is a buy. Encana was recently covered in the September 2014 issue of The Successful Investor. Click here to access it. Encana was recently…