The company announced today it will sell 40 per cent of its shale gas assets in the region to a group led by Inpex Corporation, a Japanese oil and gas company. The deal is expected to be finalized in the first quarter of 2012.
Nexen will remain the operator of the shale gas fields in the Horn River, Cordova and Liard basins northeast of Fort Nelson.
The deal comes as Nexen reveals its 2012 production and capital investment plans. The company states it will spend between $2.7 billion and $3.2 billion on capital projects next year. It expects overall production before royalties to be between 185,000 and 220,000 barrels of oil equivalent (boe), remaining relatively flat compared to this year’s production, which to date has been approximately 206,000 boe.
The deal with the Japanese firm continues a trend that has seen companies from Japan, South Korea and China invest in natural gas production in the Northeast, drawn by the potential for liquefied natural gas (LNG) to be shipped from British Columbia’s west coast to those energy-hungry markets.