take a closer look Encana Corporation CAPP Investment Symposium 2011 Mike Graham Executive Vice-President & President, Canadian Division June 13 2011
Leading North American Resource Play Company Our Strong Foundation Vast North American focused land position Large, low cost, diversified production base Huge inventory of reserves and resources Highly economic development…
Encana Corporation Vast Land Position Major Established Plays: 11.7 million net acres Horn River Greater Sierra Total Production MMcfe/d Cutbank Ridge 2010 Actual 3,321 Bighorn 2011 Forecast 3,475 3,525 CBM Deep Panuke…
Leading North American Resource Play Company Q1 2011 North American Natural Gas Production Encana 2010 annual growth per share: 12% MMcf/d 4,500 4,000 3,500 US P ro ductio n CDN P ro ductio n 3,000 2,500 2,000 1,500 1,000…
Our Strategy Provide comprehensive disclosure of reserves and resources Accelerate pace of development Attract third party investments in undeveloped reserves and resources Advance resource play hub design and development…
Our Strategy Comprehensive Disclosure of Reserves and Economic Contingent Resources (ECR) (Tcfe) Years 90 Technical Certainty Both reserves and ECR are 100% 90% 70 evaluated by IQREs* 80 50% Chart illustrates implied RLI based 10%…
Our Strategy Accelerate Pace of Development Huge inventory provides basis for developing resource at a quicker pace Growth rate limited by manpower, infrastructure, services and investment capital Assets capable of a very high…
Our Strategy Attract Third Party Investments Immediate recognition of hidden value Achieves targeted reduction in resource inventory Enhances financial flexibility Creates strategic partnerships Aligns with goal to expand…
Proposed PetroChina Joint Venture Terms of Co-operation Agreement R20 R15 R10 R5W6 Sale of 50% interest in Area of Mutual Interest T83 Cutbank Ridge business Progress/Sneddon Dawson for C5.4 billion T80 Drafting Joint Operating…
Potential Oil Opportunities Joint Venture Arrangements Deliver Royalties Several joint venture arrangements in place 4 - 40% royalty to Encana Bakken/Exshaw 1,800+ sections Viking 200+ sections Cardium 200+ sections
Encana Corporation Continuous Portfolio Highgrading 2009 50 deals for total value of 1.3 billion 10 active joint ventures Divestitures of 1,075 million Acquisitions of 260 million 2010 70 deals for total value of 1.6 billion 15…
Our Strategy Advance Resource Play Hub Design and Development Concentrated resource + Pad drilling + Manufacturing process Represents 4-6 square miles of reservoir accessed from = Resource Play Hub a single surface location.
Evolution of the Montney Completions Advance Resource Play Hub Design and Development Year 2006 2007 2008 2009 2010 Profile Horizontal Horizontal 200 Technique Perf and Plug Well Count Perf and Plug 150 Open Hole Packers Open…
Our Strategy Advance Resource Play Hub Design and Development Montney Performance History MM /MMBtu 3.5 6.45 7 3.0 Cost/Interval* Supply Cost** 6 4.55 2.5 5 DCT costs / interval 4.10 3.20 NYMEX 2.0 3.40 3.17 4…
Our Strategy Advance Resource Play Hub Design and Development Pad drilling Minimal surface impact Highly efficient Potential for even lower future costs Concurrent drilling and completions operations
The Evolution of the Horn River Advance Resource Play Hub Design and Development 16 Wells 280m Spacing 12 Wells 500m Spacing 10 Wells 800m Spacing 2010 2011F Future Spacing One pad accesses One pad accesses One pad accesses 4…
Our Strategy Increase Exposure to Oil and Natural Gas Liquids Focusing more capital into higher liquids areas of existing developments Extracting more natural gas liquids from higher BTU streams Expanding dry gas developments into…
Our Strategy Increase Exposure to Oil and Natural Gas Liquids More than 1.7 million acres with liquids rich drilling opportunities Montney Deep Basin Duvernay Alberta Bakken Collingwood Niobrara DJ As at December 31,…
Duvernay Exciting New Liquids Opportunity Swan Hills 065 190,000 net acres at ECA Fox Creek Simonette and Westlock 060 Whitecourt Barrhead Kaybob 5.2 MMcf/d / 300 bbls/d 2.1 MMcf/d w 75 bbls/MMcf Recent land 055 sales have shown…
Bighorn The Next Phase Horizontal Drilling Resthaven Falher F Hz Future Development Target thick sections of the stack Dunvegan, Falher, Cadotte 20 Bcf/Section OGIP Drill longer horizontals Increase intervals/well Increase…
CBM Development Strategy Pad Drilling 2011 type well: 200m M IRR SC* PIR(0) Single well 345 20% 3.80 1.80 4-well pad 260 30% 3.00 2.70 Shifting strategy to PAD HSCN style drilling with potential per well savings of 30%…
Deep Panuke Project First Natural Gas Production Forecast: Q4 2011 Leaving the Dry Dock Towing to Transport Vessel Positioning over Transport Vessel Ready to Sail to Nova Scotia Photos courtesy of SBM Offshore
Kitimat LNG Project Encana 30% Interest Diversifying Markets Building Demand Partners Apache (40%, operator) Encana (30%) EOG (30%) 1,400 MMcf/d (10 MMT*) export capacity Pending final investment decision Other North American…
Encana Historical Supply Cost Proven Track Record of Lowering Cost Structures /MMBtu Encana Portfolio Supply Cost Demonstrated 8 reduction in capital Upper Quartile Lower Quartile Capital Weighted weighted portfolio 7 average…
Take a Closer Look Strategically Positioned to Excel We are The leading North American resource play company Pursuing the greatest long-term value creation for shareholders Committed to responsible financial stewardship We…
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