Ovintiv
| Company type | Public company |
|---|---|
| Industry | Oil and gas |
| Predecessor | Encana |
| Founded | 2020 |
| Headquarters | Denver , United States |
Area served | North America |
Key people | Brendan M. McCracken (President), Peter A. Dea (Board Chairman) |
| Products | Petroleum, natural gas, natural gas liquids |
Ovintiv Inc. is an American oil and gas enterprise headquartered in Denver. Formed in 2020 through the reorganization of its Canadian predecessor, Encana, Ovintiv specializes in the extraction of petroleum, natural gas, and natural gas liquids.
History
On January 24, 2020, after receiving shareholder consent, Ovintiv finalized its relocation of corporate domicile from Canada to the United States. Ovintiv Canada ULC still operates an office based in Calgary.
In June 2020, the company announced a 25% reduction in its workforce as a strategic response to the downturn in oil demand, affecting operations throughout North America.
Hydrocarbon production
During 2021, the company’s average daily production consisted of 26% crude oil, 25% natural gas liquids, and 49% natural gas. Geographically, 56% of output was generated in the United States while the remaining 44% came from Canadian operations.
List of notable sales, mergers and acquisitions
In October 2004, EnCana divested its UK division, including a 43% interest in the Buzzard oil field, selling it to Nexen for $2.1 billion USD.
January 2007 saw the sale of Chad-based assets to China National Petroleum Corporation for $202.5 million. Subsequently in May of that year, it disposed of assets located in the Mackenzie River delta.
In 2009, EnCana separated its oil segment by creating Cenovus Energy as an independent entity.
A planned $45 million transaction involving its Pavillion gas field in Wyoming collapsed in late 2011. That same year, most natural gas holdings within the Barnett Shale were sold off.
In February 2012, Mitsubishi purchased a 40% interest in the Cutbank Ridge Partnership for roughly C$2.9 billion, covering approximately 409,000 net acres of Montney Formation natural gas properties situated in northeast British Columbia. Concurrently, EnCana sold Cutbank Ridge midstream infrastructure to Veresen for C$920 million.
June 2014 featured the sale of Bighorn assets in Alberta to Jupiter Resources for US$1.8 billion. That year also included EnCana’s acquisition of Athlon Energy for $7.1 billion and purchase of assets within the Eagle Ford Group from Freeport-McMoRan valued at $3.1 billion. Additionally, Jonah Energy LLC acquired operations related to the company’s Jonah Field in Wyoming.
In August 2015, EnCana exited the Haynesville Shale by selling assets for $850 million to affiliates of GSO Capital Partners and GeoSouthern Energy. By December 2015, due to declining energy prices, the company reduced both dividends and capital expenditure budgets.
July 2016 witnessed the sale of Denver Basin properties for $900 million; this was followed by a $735 million divestiture of Piceance Basin assets in June 2017.
Production at Nova Scotia’s offshore facility Deep Panuke ceased in May 2018; the platform was dismantled and recycled by 2020.
In December 2018, San Juan Basin assets were sold for $480 million.
February 2019 marked EnCana’s acquisition of Newfield Exploration, broadening its resource base across North America.
Major land assets
Ovintiv possesses approximately 1.3 million net acres within Canada, including around 773,000 net acres that remain undeveloped. Its Canadian portfolio is concentrated primarily within the Montney Formation, featuring a partnership with Mitsubishi focused on developing Cutbank Ridge located in Wheatland County, Alberta, alongside holdings in the Horn River Formation.
In February 2022, Ovintiv integrated its former subsidiary EWL Management Limited, thereby acquiring ownership over five decommissioned mines in Ontario: Coldstream Copper Mine, Gordon Lake Mine, as well as uranium mines including Greyhawk Mine, Dyno Mine, and Madawaska Mine, with ongoing rehabilitation efforts at Madawaska Mine aimed at regulatory compliance.
Within the United States, Ovintiv controls roughly 929,000 net acres with about 152,000 acres undeveloped. Principal operational regions encompass the Permian Basin, Anadarko Basin, Uinta Basin, and the Bakken formation.
Alleged collusion and bid manipulation with Chesapeake Energy
From 2008 to 2010, the company secured 250,000 net acres in the Collingwood-Utica Shale gas region, located within the Middle Ordovician Collingwood formation of the Michigan Basin, at an average price of $150 per acre. In May 2012, it purchased oil and gas rights for 2,156 acres at a Michigan Department of Natural Resources auction for approximately $185 per acre—representing an 88% decrease compared to prices two years prior.
In July 2012, Reuters disclosed emails exchanged between the company and Chesapeake Energy that suggested an arrangement to divide state land leases by Michigan counties to suppress auction prices during October 2010. Subsequently, a private landowner initiated a lawsuit against both firms in 2013, alleging bid rigging. This prompted investigations by the Department of Justice, Michigan state authorities, the IRS, and the SEC.
While the DOJ eventually dismissed its case, Michigan’s Attorney General continued legal proceedings. The company paid a settlement fine amounting to $5 million, whereas Chesapeake contributed $25 million towards a fund compensating affected parties.
Unsuccessful lawsuit by neighboring landowners to halt drilling
In 2013, two landowners adjacent to a drilling unit filed suit against the Michigan Department of Environmental Quality (DEQ) and Encana, citing potential damage due to proximity. In October 2013, the Ingham County Circuit Court issued an injunction preventing Encana from drilling until an administrative hearing was conducted with DEQ’s supervisor of wells concerning part 12 of DEQ’s oil and gas regulations. By May 2014, the supervisor ruled that the petitioners lacked legal standing as they did not own property within the drilling unit boundaries and subsequently dismissed the lawsuit.
Alleged overuse of water resources for hydraulic fracturing
In November 2013, Ecojustice, Sierra Club, and Wilderness Committee filed a lawsuit against British Columbia’s Oil and Gas Commission (OGC), challenging Encana’s repeated acquisition of short-term water permits which they claimed violated provincial water legislation. The Supreme Court upheld OGC’s practice of issuing recurring short-term water approvals in October 2014.
Water contamination concerns in Wyoming
During spring 2008, residents of Pavillion, Wyoming reported deteriorating well water quality to the United States Environmental Protection Agency (EPA). Encana was identified as the leading natural gas producer in the area. By 2009, the EPA detected hydrocarbon pollutants in local drinking water wells.
Pipeline explosions incidents
Between October 2008 and January 2009, five explosions occurred targeting Encana pipelines in Pouce Coupe, British Columbia. Reports indicated these incidents were caused by a disgruntled community member worried about risks associated with sour gas containing hydrogen sulfide. Encana faced a CAD $250,000 penalty under Canada’s Environmental Emergency Act.
Encana’s hydraulic fracturing activities in the United States are featured in the 2010 documentary Gasland, which alleges contamination of groundwater, air, and soil linked to fracking operations.
Deep Panuke offshore project
The Deep Panuke offshore development near Nova Scotia encountered opposition in 2006 when proposed as a smaller-scale project involving increased discharge into ocean waters. Encana also requested a "streamlined regulatory process" that would bypass public hearings, attracting regulatory scrutiny.
History of Legal Infractions
From 2007 through 2019 in British Columbia, Ovintiv faced 19 charges for violations of provincial laws—more than any other entity—and was subject to the largest cumulative penalties.
President
Michael G. McAllister, January 24 – June 30, 2020 Brendan M. McCracken, December 1, 2020 – present
Board Chairman
Clayton H. Woitas, January 24 – June 30, 2020 Peter A. Dea, June 30, 2020 – present