Canadian oil and gas producer Encana Corp (ECA.TO) (ECA.N) posted a better-than-expected fourth-quarter profit on Thursday and said production rose 4 per cent.

Calgary, Alberta-based Encana, which produces gas and light oil, has benefited from whittling down its operations to focus on its four core North American assets: acreage in Montney and Duvernay in Western Canada and assets in the prolific Eagle Ford and Permian shale fields in Texas.

Production from core assets jumped 32 per cent to 313,200 barrels of oil equivalent per day (boe/d).

The company said on Thursday total quarterly production increased to 335,200 boe/d, from 321,500 boe/d a year earlier. It realized US$52.94 per barrel of oil production, compared with US$50.78 a year ago.

The company also announced a buyback of up to US$400 million worth in shares.

"We have further demonstrated our confidence in our five-year plan and our commitment to shareholder returns with the announcement of our share repurchase program which we plan to fund with cash on hand," Chief Executive Officer Doug Suttles said in a statement.

The company's net loss narrowed to US$229 million - and reflected a non-cash deferred tax charge primarily due to a fall in tax rates in 2017 related to the U.S. tax reform - from US$281 million, a year earlier.

Encana expects to spend between US$1.8 billion and US$1.9 billion in 2018, up from US$1.6 billion to US$1.8 billion it had forecast for 2017.

Last month the company said it plans to invest nearly 70 per cent of this budget to boost production in Permian and Montney, as oil investors pressure producers to improve production without significantly increasing capital budgets.

Encana said it expects production for 2018 to be between 360,000 boe/d and 380,000 boe/d. Total production in 2017 was 313,200 boe/d.

Excluding one-time items, the company earned 12 cents per share in the fourth quarter, above analysts' average estimate of 10 cents per share, according to Thomson Reuters I/B/E/S.