Canadian natural gas giant Encana says it will cut its workforce by 20 per cent and close its office in Plano, Texas.
At the end of the last fiscal year, Encana had 4,169 employees, so a 20 per cent reduction would work out to just over 800 people.
The Calgary-based company also plans to narrow its production focus to five oil-related projects in North America from as many as 30.
"In order to align our organization with our strategy, we have had to make a number of exceptionally difficult decisions," chief executive Doug Suttles said in a statement.
"The restructuring that is underway reflects our shift from funding about 30 different plays to focusing our resources on five key areas.
Encana said it plans to sell assets and improve its cash flow. It will also create a separate company to own its mineral rights and royalty interests across southern Alberta, the statement said.
An initial public offering will be done by mid-2014.
"Encana intends to retain a significant stake in the new company, which will manage leasing activities in the area currently known as Encana's Clearwater play," the statement said.
Suttles was upbeat about the company's future after the restructuring and layoffs
"I'm excited about Encana's future and encouraged by how our people have rallied as one team to get Encana back to winning," he said in the statement.
"While we have a lot of challenging work ahead of us, I am more confident than ever that we will be successful."
The company also slashed its dividend significantly, cutting it by more than two thirds to seven cents per share. That's down from 20 cents.
Encana shares were up about four per cent to just over $19 on the TSX on Tuesday. But the shares are still down by more than 15 per cent in the past 12 months.
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