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Calgary-based Encana Corp. (TSX:ECA) is selling some assets in northwestern Alberta to Birchcliff Energy Ltd. (TSX:BIR) for $625 million.

The company said Tuesday that the sale includes wells producing 25,200 barrels of oil equivalent a day, along with pipelines and other infrastructure, on about 22,000 hectares of land.

CEO Doug Suttles said the transaction will strengthen Encana’s balance sheet and provide financial flexibility.

Encana said the deal also means it can avoid future spending commitments of $100 million on the property, allowing it to focus on core areas in Canada and the United States.

Birchcliff, also based in Calgary, plans to partially fund the purchase by selling $530 million worth of shares to underwriters, who will then sell them to the public. It said its major shareholder, Toronto billionaire Seymour Schulich, has agreed to buy an additional $19 million in shares.

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READ MORE: Encana to cut work force by another 20%

Encana has announced the sale of nearly US$3 billion in assets since the end of 2014 and paid off about US$2 billion in debt. It has reduced its workforce by about half to 1,600 since 2013.