PetroChina Buys Major Shale Stake from Encana

After nine months of talks, Encana Corp said on Wednesday it will sell half of a prolific British Columbia shale gas project to state owned PetroChina for C$5.4 billion.

Encana, one of North America's largest gas producers, and PetroChina have agreed to form a 50-50 joint venture to develop the Cutbank Ridge lands in northeastern B.C.

PetroChina's stake represents current daily production of about 255 million cubic feet equivalent per day, proven reserves of about 1.0 trillion cubic feet of natural gas equivalent and about 257,000 net hectares of land located between the British Columbia and Alberta boundary.

This deal represents the largest Chinese investment in a Canadian energy asset surpassing Sinopec Corp's $4.65 billion acquisition of ConocoPhillips' stake in the Syncrude Canada oil sands venture last year.