Encana president and CEO Doug Suttles addresses the company’s annual meeting in Calgary, on April 30, 2019. THE CANADIAN PRESS/Jeff McIntosh

Encana president and CEO Doug Suttles addresses the company’s annual meeting in Calgary, on April 30, 2019. THE CANADIAN PRESS/Jeff McIntosh

Encana moves headquarters from Calgary to U.S., changes name to Ovintiv

CEO says changes won’t result in layoffs or divert investment strategies in Alberta and B.C.

Encana Corp., one of Canada’s oldest and largest energy companies, is moving its corporate headquarters from Calgary to the United States to bolster its access to deep-pocketed investors.

The company, which is also changing its name to Ovintiv Inc., says having a U.S. address will expose it to increasingly larger pools of investment in U.S. index funds and passively managed accounts.

On a conference call on Thursday morning, CEO Doug Suttles insisted the name and “corporate domicile” changes will not affect any Canadian staff, result in any layoffs or divert investment strategies in oil and gas formations in Alberta and B.C.

“Make no mistake, we have a long and proud history in Canada and our assets here are world class,” he said.

“Our returns in Canada continue to be every bit as strong as the rest of our portfolio. We will continue to make profitable investments in the Montney and the Duvernay and manage these assets out of the Calgary office. We do not expect any impact on our Canadian workforce, either in the office or the field.”

Encana’s Canadian address means it isn’t included in stock market indexes with its U.S. peers and therefore doesn’t attract dollars from growing ranks of passive investors, said chief financial officer Corey Code on the call.

“We estimate today that less than 10 per cent of our ownership is comprised of passive accounts, far less than the 30 per cent average for our U.S. peers,” he said.

Analysts said the move is not surprising given Encana’s increased focus on oil and natural gas liquids plays in the United States over the past decade, culminating in its US$5.5 billion all-shares acquisition of U.S. rival Newfield Exploration Co. announced a year ago.

“I am not surprised at all by the move,” said Jennifer Rowland, a U.S.-based analyst with Edward Jones.

“Post the Newfield deal, 60 per cent of Encana’s production is in the U.S. and two of its key growth drivers are in the U.S. … Plus CEO Suttles doesn’t live in Canada; he lives in Denver.”

Alberta Energy Minister Sonya Savage had a similar message. “I am troubled by news that Encana is formally relocating its headquarters to the United States,” she said, in a tweet. “Sadly, I cannot say I’m surprised, as Encana has been shifting its efforts to the US for years, in large part due to harmful policies in Canada.”

RELATED: No government can bring back Alberta oil boom, experts say

Analyst Phil Skolnick of Eight Capital Research said the headquarters move is bound to lead to speculation about a sale of Canadian operations.

“It will beg the question of whether or not ECA will eventually sell or spin out its Canadian assets. We believe in this current market, this is not in the works,” he said in a report.

The company’s shares sank on the news, falling 49 cents, or 8.86 per cent, to $5.04 in midmorning trading on the Toronto Stock Exchange.

Dan Healing, The Canadian Press

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Alberta has 1,910 active cases of COVID-19 as of Wednesday. Red Deer is reporting five active cases, with 108 recovered. (File photo)
Red Deer reports 25th COVID-19 death

415 new cases identified provincially Saturday

Alberta Health reported two new COVID-19 deaths in Red Deer Friday. (Image courtesy CDC)
Two more deaths linked to Olymel outbreak in Red Deer

Province reported 356 additional COVID-19 cases Friday

Black Press file photo
Wetaskiwin RCMP execute search warrant; illegal drugs seized

Two Wetaskiwin residents have been charged with possession and trafficking of Methamphetamine.

Alberta Premier Jason Kenney speaks during a news conference in Edmonton on Feb. 24, 2020. It’s budget day in the province, and Kenney’s United Conservative government is promising more help in the fight against COVID, but more red ink on the bottom line. THE CANADIAN PRESS/Jason Franson
Alberta’s budget promises more help for COVID-19 with a hard deficit

Annual spending on debt interest is closing in on $3 billion

Emily Keeping of Wetaskiwin, Alta., was last seen at 4:20 p.m. on Feb. 25, 2021 at the FasGas on 49 St and 50 Ave in Wetaskiwin. Supplied/ Wetaskiwin RCMP.
UPDATE: Wetaskiwin RCMP seek assistance in locating missing 11-year-old

Emily Keeping was last seen on Feb. 25, 2021 at the FasGas on 49 St and 50 Ave in Wetaskiwin.

A helicopter flies past a mountain near McBride, B.C., on Saturday January 30, 2016. THE CANADIAN PRESS/Darryl Dyck
Avalanche warning for backcountry users in North and South Rockies

Avalanche Canada is urging backcountry users to always check their regional avalanche forecasts

Supporters pray outside court in Stony Plain, Alta., on Wednesday, Feb. 24, 2021, as a trial date was set for Pastor James Coates of GraceLife Church. He is charged with holding Sunday services in violation of Alberta’s COVID-19 rules and with breaking conditions of his bail release. THE CANADIAN PRESS/Jason Franson
Trial date for jailed Alberta pastor charged with breaking COVID-19 health orders

The court says it will reconvene with lawyers on March 5 for a case management plan by teleconference

A pharmacist prepares a COVID-19 vaccine at Village Green Retirement Campus in Federal Way on Jan. 26. (Olivia Sullivan/Sound Publishing)
Canada approves use of AstraZeneca’s COVID-19 vaccine

The country joins more than a dozen others in giving the shot the green light

Sylvan Lake's Winter Village lured many visitors to the town this winter. The town has launched a new contest to attract a new business.
(Black Press file photo)
Sylvan Lake offering rent-free storefront space to lure new businesses

Winning business proposal will get a storefront space rent-free for a year

NDP leader Jagmeet Singh holds a press conference on Parliament Hill in Ottawa on Wednesday, Feb. 24, 2021. THE CANADIAN PRESS/Sean Kilpatrick
NDP will not trigger election as long as pandemic continues: Singh

‘“We will vote to keep the government going’

Mike Ammeter (Photo by Rebecca Hadfield)
Sylvan Lake man elected chair of Canadian Canola Growers Association

Mike Ammeter is a local farmer located near the Town of Sylvan Lake

Students and staff at Gateway Christian School wore pink Wednesday in support of Pink Shirt Day, a worldwide anti-bullying initiative that was started in 2007. (Photo courtesy of Red Deer Public Schools)
Students, central Alberta community celebrate Pink Shirt Day

Mayor of Sylvan Lake Sean McIntyre supports anti-bullying cause

Most Read