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June 2013 Investor Presentation – Encana Corp

Encana Corp · Jun 14, 2013 · 83 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. June 2013 Investor Presentation – Encana Corp – slide 1
    Corporate Presentation June | 2013
  2. June 2013 Investor Presentation – Encana Corp – slide 2
    Doug Suttles ? 30 years experience in oil & gas industry ? Strong track record in strategic and operational delivery ? Formerly COO, BP Exploration & Production ? 2008 recipient of University of Texas Mechanical Engineering…
  3. June 2013 Investor Presentation – Encana Corp – slide 3
    The Path Forward ? Process: ? Continue to operate safely ? Full scale asset review ? Understand internal capabilities ? Bring together a united leadership team ? Assess the macro environment ? Formulate Encana?s go forward…
  4. June 2013 Investor Presentation – Encana Corp – slide 4
    Tremendous Asset Base Leading North American Portfolio of Resource Plays Greater Sierra (inc. Horn River) Duvernay Cutbank Ridge Bighorn Clearwater Jonah Niobrara/Mancos DJ Niobrara Piceance Texas Haynesville Tuscaloosa…
  5. June 2013 Investor Presentation – Encana Corp – slide 5
    Encana?s Strengths Portfolio of Land, Reserves & Production* Land (MM net acres) ? Total land position: ? Fee land (advantaged royalty structure): 10.9 3.6 Reserves & Resources (Tcfe; 100% externally evaluated) ? Proved reserves…
  6. June 2013 Investor Presentation – Encana Corp – slide 6
    2013 Focus 1. Top priority - capital discipline and driving down costs 2. Liquids transition - measured pace of investment; speed of transition contingent upon results 3. Emerging plays - prove commercial success 4. Natural gas -…
  7. June 2013 Investor Presentation – Encana Corp – slide 7
    Exercising Capital Discipline 2012 2013F Capital Investment ($B) 3.5 3.0 ? 3.2 Net Divestitures ($B) 3.7 0.5 ? 1.0 Net Capital Investment ($B) (0.2) 2.0 ? 2.7 Natural Gas (Bcf/d) 3.0 2.8 ? 3.0 Oil (Mbbls/d) 17.6 22 ? 28 NGLs…
  8. June 2013 Investor Presentation – Encana Corp – slide 8
    Dry Gas 21% Oil 25% Liquids Rich Gas 54% Canada 52% USA 48% Peace River Arch 30% Bighorn Clearwater 20% 16% Cutbank Ridge 13% Duvernay 11% Other 10% Haynesville 21% DJ Basin 18% Piceance 22% Emerging Plays…
  9. June 2013 Investor Presentation – Encana Corp – slide 9
    2013F Capital Allocation* 0.0 0.5 1.0 1.5 2.0 2.5 3.0 2011 2012 2013F Oil Liquids Rich Natural Gas Natural Gas Investing in Highest Return Projects *Represents upstream capital only; excludes Corporate & Other capital. 2013F…
  10. June 2013 Investor Presentation – Encana Corp – slide 10
    Capital Discipline Focused on Driving Down Costs ? Fund the most profitable assets ? ~80% of 2013F upstream capital allocated to oil & liquids rich natural gas plays ? ~40% of 2013F operating cash flow from oil and NGLs ? Low cost…
  11. June 2013 Investor Presentation – Encana Corp – slide 11
    Why Third Party Capital Works For Us ? Achieve immediate recognition of value ? Cutbank Ridge Partnership with a Mitsubishi subsidiary ? Duvernay joint venture with a PetroChina subsidiary ? Maintain capital and operating efficiencies…
  12. June 2013 Investor Presentation – Encana Corp – slide 12
    Year 1 Year 2 Year 3 Year 4 How Third Party Capital Benefits Encana Illustrative JV vs. Retained Development Plan* ? Encana capital constant in either case ? Partner capital spent towards Encana?s working interest increases net…
  13. June 2013 Investor Presentation – Encana Corp – slide 13
    Leveraging Third Party Capital Completed Joint Ventures, Partnerships & Farm-outs 550 720 1,110 1,240 730 750 980 1,030 770 1,100 1,760 1,980 0 1,000 2,000 3,000 4,000 5,000 2012 Actual 2013F 2014F 2015F Encana\'s WI…
  14. June 2013 Investor Presentation – Encana Corp – slide 14
    Accelerating Value Cutbank Ridge Partnership (CRP) * PIR - Profit to Investment Ratio (PV9). * Based on Feb 2013 AECO strip pricing. 0 50 100 150 200 250 Capital A-Tax NPV Capital & NPV Comparison Much Less Capital for Similar…
  15. June 2013 Investor Presentation – Encana Corp – slide 15
    Sources of Liquids Growth in 2013 Conservative Approach Allows Time to Evaluate Profitability ? Currently commercial liquids plays ? Driving growth in 2013: ? DJ Basin - oil ? Piceance ? liquids rich gas ? Cutbank Ridge ? liquids…
  16. June 2013 Investor Presentation – Encana Corp – slide 16
    NGL Barrel Composition and Prices 28 ? 32 Mbbls/d in 2013F Product Encana 2013 Price Assumptions (% WTI) % of 2013F Volumes Ethane 10 - 15 30 Propane 30 - 35 25 Butane 70 - 75 15 Condensate 100 - 105 30 Based on 2013 forward…
  17. June 2013 Investor Presentation – Encana Corp – slide 17
    Industry Leading Natural Gas Producer North America?s 3rd Largest Natural Gas Producer ? Technology leader ? Resource Play Hub development model ? Highly efficient, repeatable process ? Leverages economies of scale ? 2013F dry gas…
  18. June 2013 Investor Presentation – Encana Corp – slide 18
    $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 ECA Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 US$/Mcfe Operating Cost Comparison 2012 - Excluding Transportation & Processing Striving to be the most efficient…
  19. June 2013 Investor Presentation – Encana Corp – slide 19
    Advancing Resource Play Hub Development Track Record of Continuous Supply Cost Reductions ? Substantial cost reductions through resource play hub model ? Multi-well pad using fit for-purpose rig ? Cost savings with minimal…
  20. June 2013 Investor Presentation – Encana Corp – slide 20
    Maintaining Financial Strength & Flexibility ? Planning to pay 2013 debt maturity ($500 million) with cash ? $2.9 billion of cash and short term investments as at March 31, 2013 ? ~$5 billion of undrawn bank lines committed until 2015…
  21. June 2013 Investor Presentation – Encana Corp – slide 21
    Converting assets into cash flow Key Messages ? Striving to be North America?s most efficient and profitable developer of natural gas ? Tremendous asset base ? Growing exposure to oil and natural gas liquids ? Ensuring…
  22. June 2013 Investor Presentation – Encana Corp – slide 22
    Canadian Division 2013 Strategic Focus Encana Land (Dec. 31, 2012) Total Canadian Division Net Acres: ~8.0 MM ? Manage KOGAS, Mitsubishi, Toyota and PetroChina joint ventures ? Evaluate Duvernay and other potential liquids-rich…
  23. June 2013 Investor Presentation – Encana Corp – slide 23
    13% 20% 30% 16% 11% 10% Cutbank Ridge Bighorn Peace River Arch Clearwater Duvernay Other 2012 Actual 2013F % Change Natural Gas Production (MMcf/d) 1,359 1,500 ? 1,600 10 ? 18 Liquids Production (Mbbls/d) 19.4 30 ? 35 55 ?…
  24. June 2013 Investor Presentation – Encana Corp – slide 24
    Canadian Division 2013 Liquids Strategy Liquids production (Mbbls/d) 5 0 10 15 20 25 2011 2012 2013F Oil NGLs ? Execute joint venture programs ? Mitsubishi, PetroChina ? Maximize value via liquids production ? Advancing…
  25. June 2013 Investor Presentation – Encana Corp – slide 25
    Peace River Arch Asset Overview Resource ? 602,000 net acres ? Estimated PIIP: 36 Tcf, 1 ? 3 billion bbls ? Well cost: $7 ? $12 million ? EUR per well: 4 ? 16 Bcfe ? Oil gravity: 47 ? 63 API Strategy ? Accelerate liquids…
  26. June 2013 Investor Presentation – Encana Corp – slide 26
    Peace River Arch Historical Production - Improving Liquids Yields Gas production (MMcf/d, NBR) Liquids production (bbls/d, NBR*) 0 3,000 6,000 9,000 12,000 0 50 100 150 200 2008 2009 2010 2011 2012 2013F Liquids Gas *Net…
  27. June 2013 Investor Presentation – Encana Corp – slide 27
    Peace River Arch Montney Oil Granite Wash Liquids Rich Montney Multiple Potential New Plays Under Evaluation
  28. June 2013 Investor Presentation – Encana Corp – slide 28
    Peace River Arch History of Gordondale Development Pouce Gamma Ray Density Resistivity Montney Mid Montney Sexsmith Mid Pouce Belloy ? 2005: Deviated vertical multi-well pads ? 2007: Horizontal wells ? Infill drilling between…
  29. June 2013 Investor Presentation – Encana Corp – slide 29
    Cutbank Ridge Asset Overview Resource ? 982,000 gross acres ? Estimated PIIP: 130 Tcf, 1 ? 2 Bbbls ? Well cost: $5 ? $10 million ? EUR per well: 4 ? 16 Bcfe ? Oil gravity: 45 ? 65 API Strategy ? Increase value through…
  30. June 2013 Investor Presentation – Encana Corp – slide 30
    Montney Supply Cost Evolution Advancing Resource Play Hub Design and Development $0.46 0.46 $0.94 $0.86 $1.50 $0.63 $0.51 $3.20 $0.56 $3.17 $3.15 $2.85 $2.69 $3.40 $4.55 $6.45 $4.10 $2.09 $1.91 0.0 0.5 1.0 1.5 2.0…
  31. June 2013 Investor Presentation – Encana Corp – slide 31
    Improved Completions Results Cutbank Ridge Slickwater/Cluster Perforation Application Gas Rate/100m (Mcf/d) Production Days Pilot Wells Offsets 60% Increase ? 5 well pilot: Improved initial rates compared to offsetting wells
  32. June 2013 Investor Presentation – Encana Corp – slide 32
    0 100 200 300 400 500 600 700 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 0 50 100 150 200 250 Condensate Production (bbls/d) Gas Production (MMcf/d) Flowing Hours Gas Rate (mmcf/d) (MMcf/d ConD Rate (bbl/d) Condensate…
  33. June 2013 Investor Presentation – Encana Corp – slide 33
    Cutbank Ridge Partnership (CRP) ? Partnership with Mitsubishi: ? Encana 60% interest ? Mitsubishi, 40% interest ? 5 development areas: ? Montney: Saturn, Swan and Tumbler Ridge ? Cadomin: Tumbler Ridge ? Doig: Tumbler Ridge ?…
  34. June 2013 Investor Presentation – Encana Corp – slide 34
    Resource ? 414,000 net acres ? Estimated PIIP: 32 Tcf, 1 ? 2 Bbbls ? Well cost: $5 ? $10 million ? EUR per well: 2 ? 12 Bcfe ? Oil gravity: 55 ? 60 API Strategy ? Focus on liquids-rich opportunities ? Continue stacked Cretaceous…
  35. June 2013 Investor Presentation – Encana Corp – slide 35
    0 20 40 60 80 100 CARD. DUNV. CDTT FLHR / WLRCH Bighorn ? Horizontal Inventory # of Wells Estimated Inventory Drilled 2013F Cardium 85 2 1 Dunvegan 115 8 5 Cadotte 215 2 0 Falher/Wilrich 335 44 19 Total 750 56 25 Hz Hz…
  36. June 2013 Investor Presentation – Encana Corp – slide 36
    Bighorn Cost Reductions Cost Reduction Example ? Falher Horizontal Wells 8 4 0 12 16 20 0.0 0.5 1.0 1.5 2.0 2.5 2008 2009 2010 2011 2012 Drilling Completions Equip & Tie-In Intervals Average number Cost per interval ($MM)…
  37. June 2013 Investor Presentation – Encana Corp – slide 37
    Bighorn - Kakwa 13-24-61-6W6 Falher C ? DCT cost: $8.5 MM ? IRR: 55 ? 60 % ? PIR@9%: 1.20 ? 1.35 ? Supply Cost: 0.90 ? 1.10 US$/MMBtu ? Inventory: ~25 wells ? 30 day IP: ? 12.5 MMcf/d gas ? 220bbls/d C 5+ (17 bbls/MMcf) ? 1,037…
  38. June 2013 Investor Presentation – Encana Corp – slide 38
    Bighorn Completion Successes ? Successful stimulation of longer laterals with increased frac stages ? Demonstrated cost reduction ? Repeatable and efficient execution using open hole packers ? Optimizing frac size and spacing to…
  39. June 2013 Investor Presentation – Encana Corp – slide 39
    Resource ? 460,000 gross acres ? Estimated PIIP*: ~9.1 billion BOE ? 50 ? 60 API oil gravity ? 1,020 ? 1,170 Btu/scf average heat content ? 1,000 - 1,600 gross well locations ? 160 ? 330 acre expected well spacing Strategy ?…
  40. June 2013 Investor Presentation – Encana Corp – slide 40
    Duvernay The Encana Advantage ? Encana has captured over half of the high-graded liquids rich gas condensate fairway ? Encana free condensate yield results are top quartile ? Estimate 30 Tcf and 4 billion bbls PIIP on Encana…
  41. June 2013 Investor Presentation – Encana Corp – slide 41
    Duvernay Joint Venture ? PetroChina agreed to invest C$2.18 billion for 49.9% working interest ? C$1.18 billion up front cash ? A further investment of C$1.0 billion during the commitment period (~4 years) ? Estimated C$4.0…
  42. June 2013 Investor Presentation – Encana Corp – slide 42
    Resource ? 4.6 million net acres ? Encana owns mineral rights on 78% of lands ? Average royalty rate of ~7% ? Estimated PIIP: 12 Tcf (CBM), 600 MMbbls Strategy ? Advance conventional oil plays ? Maintain CBM competence Current…
  43. June 2013 Investor Presentation – Encana Corp – slide 43
    Well Parameters ? Inventory: ~ 100 locations ? Well cost: ? Vertical well: $1.3 ? $2.0MM ? Horizontal well : $2.2 ? $3.0MM ? EUR per well: 60 ? 120 Mbbls ? 28 - 32 API oil Current Activity/Results ? 21 net wells on production by…
  44. June 2013 Investor Presentation – Encana Corp – slide 44
    Clearwater Royalty Interest Wells 2012 summary ? Production ? Gas: 35 MMcf/d ? NGL: 1.7 Mbbls/d ? Oil: 4.5 Mbbls/d ? Royalty interest revenue ? $160MM
  45. June 2013 Investor Presentation – Encana Corp – slide 45
    Toyota Tsusho ? Upfront cash of C$100 million ? Agreed to provide capital funding of C$502 million over 7 years: ? 1,488 drilling locations ? 1,606 recompletion locations ? Acquired uniform 32.5% GORR on PDP and Future…
  46. June 2013 Investor Presentation – Encana Corp – slide 46
    KOGAS Farmouts Two Separate Deals ? Deal 1 ? Signed February 26, 2010 ? 38 sections ? $324 million earn-in capital ? KOGAS earned 50% working interest in April 2012 ? Deal 2 ? Signed July 28, 2011 ? 33 sections ? $185 million…
  47. June 2013 Investor Presentation – Encana Corp – slide 47
    Operating cost ($/Mcfe) $0.95-$0.65 at 200 ? 300 MMcf/d Transportation cost ($/Mcfe) $1.68 Royalties 3% Delivery point Premium price to NYMEX Deep Panuke Project First Natural Gas Production Forecast: First Half 2013
  48. June 2013 Investor Presentation – Encana Corp – slide 48
    USA Division 2013 Key Strategies Encana Land (Dec. 31, 2012) Total USA Division Net Acres: 2.9 MM Jonah Piceance Niobrara/ Mancos DJ Niobrara Texas Haynesville Collingwood/Utica Tuscaloosa Mississippian Lime San Juan…
  49. June 2013 Investor Presentation – Encana Corp – slide 49
    5% 21% 18% 22% 5% 29% Jonah Haynesville DJ Basin Piceance Other* Emerging Plays 2012 Actual 2013F % Change Gas Production (MMcf/d) 1,622 1,300 ? 1,400 (20) ? (14) Liquids Production (Mbbls/d) 11.6 20 ? 25 72 ? 116 Core…
  50. June 2013 Investor Presentation – Encana Corp – slide 50
    USA Division Liquids Production Profile 2013 Liquids Growth Strategy ? Complete evaluation of emerging plays ? Milestone approach testing larger completions with defined type curve and cost targets ? Execute existing joint…
  51. June 2013 Investor Presentation – Encana Corp – slide 51
    Williams Fork Resource ? 801,000 net acres ? EUR: 1 ? 4 Bcf /well ? >8,000 gross well locations Strategy ? Continue to execute on existing joint ventures ? Optimize spacing and frac volume ? Reduce drilling and completion costs…
  52. June 2013 Investor Presentation – Encana Corp – slide 52
    DJ Basin Asset Overview Resource ? 49,000 net acres ? Estimated PIIP: 700 million BOE ? Primarily light oil with associated gas/NGLs ? 80% NRI ? 500 gross well locations Strategy ? Accelerate commercial development ? Optimize…
  53. June 2013 Investor Presentation – Encana Corp – slide 53
    Resource ? 184,000 net acres ? NGIP: 80 Tcfe ? > 500 gross producing wells ? 2,200 wells in inventory (1P + 1C) Strategy ? Top value/low risk wells ? Cross Unit laterals > 7,500? ? RPH development ? Continue completion evolution…
  54. June 2013 Investor Presentation – Encana Corp – slide 54
    Haynesville RPH Development Past, Present and Future Cross-unit long lateral resource play hub pads North Louisiana ? Past - 2011/2012 ? 8 wells per section (2 sections) ? 4,620 feet max lateral length ? XP completion design ?…
  55. June 2013 Investor Presentation – Encana Corp – slide 55
    Completion Design 2011 Standard XP XP? Cluster Spacing (feet) 55 55 55 Fluid (kgals/cluster) 90 100 110 Proppant, (klbs/cluster) 90 110 150 Wells/Section 8 - 16 8 6 Well Spacing (acres) 40 - 80 80 108 60 70 80 90 100 110 120…
  56. June 2013 Investor Presentation – Encana Corp – slide 56
    Haynesville Supply Cost Evolution ? Long laterals and RPH development efficiencies expected to deliver $2.50 to $3.00 supply cost in 2013 ? Cross unit drilling rules amended by Louisiana in Q4 2012 ? Continuous completion design…
  57. June 2013 Investor Presentation – Encana Corp – slide 57
    Lake Michigan Lake Huron ECA acreage Collingwood Shale Northern Location MI 25 miles Southern Location Pioneer 1-3 Excelsior 1-25 Excelsior 1-13 Wilmot 1-21 Kendall & Koehler 1-33 Resource ? 429,000 net acres ? Estimated…
  58. June 2013 Investor Presentation – Encana Corp – slide 58
    Resource ? 124,000 net acres ? Estimated PIIP: 8.6 billion BOE ? Primarily light oil ? 75% RI ? ~1,150 gross well locations Strategy ? Establish commerciality through longer laterals and improved completion design ? Accelerate…
  59. June 2013 Investor Presentation – Encana Corp – slide 59
    Resource ? 124,000 net acres ? Estimated PIIP: 8.6 billion BOE ? Primarily light oil ? 75% RI ? ~1,150 gross well locations Strategy ? Establish commerciality through longer laterals and improved completion design ? Accelerate…
  60. June 2013 Investor Presentation – Encana Corp – slide 60
    Mississippian Lime Asset Overview - Osage Mississippian production: >50,000 vertical wells ; ~1,400 horizontal wells Resource ? 81,600 gross/net acres (Osage only) ? Estimated PIIP: 2.5 billion BOE ? Primarily light oil with…
  61. June 2013 Investor Presentation – Encana Corp – slide 61
    Resource ? 168,000 net acres captured in oil window ? Primarily light oil with associated NGLs ? 80% NRI ? ~900 potential net locations Strategy ? Appraise oil window of the Gallup/Mancos formation ? Ramp-up to commercial…
  62. June 2013 Investor Presentation – Encana Corp – slide 62
    BOE 1H Anderson 17H-1, 18H-1 J Jackson 4H-2 Horseshoe Hill 10H-1 7.5 MMBO/Section OOIP Defines Play Core ECA Drilled Completed ECA 2013 Industry Drilled Industry Planned Vertical Penetrations TMS Asset Overview Well Name…
  63. June 2013 Investor Presentation – Encana Corp – slide 63
    Subsurface Learnings ? Longer laterals & enhanced completions delivering improved performance ? Anderson wells establishing type curve ? Established relationship between job size and EUR. Currently testing larger jobs. ? Data…
  64. June 2013 Investor Presentation – Encana Corp – slide 64
    Comprehensive Disclosure of Reserves & Resources Largest Reserves and Resource Life in Encana?s History Encana Reserves and Resources (Tcfe) 1 Estimated reserves Estimated economic contingent resources Resource Play P1 Proved P2…
  65. June 2013 Investor Presentation – Encana Corp – slide 65
    Reserves & Resources Assignment Understanding 1C Economic Contingent Resources Surface locations Proved Developed (PD) wells Proved Undeveloped (PUD) locations Contingent locations 1P 1P 1P 1P 1P 1P 1C 1C 1C 1C
  66. June 2013 Investor Presentation – Encana Corp – slide 66
    High Quality Asset Base 1.16 Tcfe 13.1 13.1 7.6 25.4 3.6 7.6 20.0 3.6 24.4 0 10 20 30 40 50 60 70 0 10 20 30 40 50 60 70 80 90 100 Annualized 2011 Production 2012 Reserves 2012 Reserves & ECR Reserves and…
  67. June 2013 Investor Presentation – Encana Corp – slide 67
    0 20 40 60 80 100 Peak Rate (%) New Plays Commercial Assets Harvest Assets Cutbank Ridge - Montney Horseshoe Canyon CBM Bighorn Horn River ? Two Island Lake Greater Sierra - Jean Marie Horn River - Kiwigana West Cutbank -…
  68. June 2013 Investor Presentation – Encana Corp – slide 68
    Disciplined Risk Management Natural Gas Price Hedging* - Increased Cash Flow Certainty 0.8 1.5 1.5 $4.39 $4.19 $4.37 0.0 0.5 1.0 1.5 2.0 2.5 2013 2014 2015 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 Volume NYMEX Fixed Price…
  69. June 2013 Investor Presentation – Encana Corp – slide 69
    NGL Value Uplift Generic Example $4.34 $4.16 $3.88 $3.47 $3.90 $3.73 $3.12 $0.57 $0.89 $1.29 $1.32 $0.64 $0.91 $1.16 $0.24 $0.48 $4.92 $5.06 $5.20 $5.03 $4.55 $4.66 $4.76 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 Dew…
  70. June 2013 Investor Presentation – Encana Corp – slide 70
    North American Natural Gas Dry Gas, Wet Gas and Associated Gas from Oil Wells 10 20 30 40 50 60 70 80 90 100 110 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Dry Gas Wet Gas Associated Gas…
  71. June 2013 Investor Presentation – Encana Corp – slide 71
    North American Cost of New Supply 2012 Market Deliverability 0 5 10 15 20 25 $0.00 - 0.50 $0.50 - 1.00 $1.00 - 1.50 $1.50 - 2.00 $2.00 - 2.50 $2.50 - 3.00 $3.00 - 3.50 $3.50 - 4.00 $4.00 - 4.50 $4.50 - 5.00 $5.00 - 5.50…
  72. June 2013 Investor Presentation – Encana Corp – slide 72
    North American Natural Gas December 2012 vs. December 2011 Production 3.15 1.36 0.14 0.12 0.12 0.10 0.09 0.08 0.08 0.06 0.01 (0.09) (0.09) (0.09) (0.11) (0.13) (0.14) (0.17) (0.23) (0.23) (0.24) (0.29) (0.32)…
  73. June 2013 Investor Presentation – Encana Corp – slide 73
    North American Natural Gas Demand Ranges by Selected Sector Mexico Exports Industrial (U.S. and Oil Sands) Transport/HHP LNG Export Power 2.5 4.5 1.5 Significant demand growth is possible in the LNG, transportation/HHP and…
  74. June 2013 Investor Presentation – Encana Corp – slide 74
    Projected New Natural Gas Demand Creation Excellent Opportunities Diversified Across Many Sectors Bcf/d Shorter Term…
  75. June 2013 Investor Presentation – Encana Corp – slide 75
    North American Natural Gas U.S. Prior Announced and Forecast Coal Retirements Approximately 56 GW of coal retires in North America by 2025*, with the majority retiring mid decade in accordance with environmental compliance deadlines 8…
  76. June 2013 Investor Presentation – Encana Corp – slide 76
    North American Natural Gas U.S. Prior Announced and Forecast Coal Retirements Approximately 56 GW of coal retires in North America by 2025*, with the majority retiring mid decade in accordance with environmental compliance deadlines 8…
  77. June 2013 Investor Presentation – Encana Corp – slide 77
    Source: Encana Fundamentals, company announcements In 2012, 10 GW of coal-fired capacity retired. An additional 41 GW has announced retirement from 2013-2025. Long-term: Coal Unit Retirements Coal Retirements are a 3.7 Bcf/d Demand…
  78. June 2013 Investor Presentation – Encana Corp – slide 78
    North American Natural Gas Announced Industrial Expansion Expansions, new builds, restarts and relocations from 2013 to 2025 Source: Encana Fundamentals, Company Reports Ammonia 42% Ethylene 19% Metals 13% Methanol 23%…
  79. June 2013 Investor Presentation – Encana Corp – slide 79
    What Makes LNG for Transportation Viable? Illustrative Full Cycle Cost Components ? LNG vs. Diesel Sales and Excise Tax Retailing Distribution *$4.00/MMBtu gas and $100/bbl oil, blended Canada/U.S. analysis; Encana estimates; DGE:…
  80. June 2013 Investor Presentation – Encana Corp – slide 80
    Transforming North American Transportation Strategic with Economic Return on Infrastructure Investment 0 2.5 5 7.5 2012 2015 2018 2021 2024 2027 0 2.5 5 7.5 2012 2015 2018 2021 2024 2027 *Assumes $4.00/Mcf NYMEX gas and…
  81. June 2013 Investor Presentation – Encana Corp – slide 81
    The North American Market is Responding Infrastructure Growth and Recent Industry Announcements 831 825 952 1030 38 36 44 46 0 200 400 600 800 1,000 1,200 2008 2009 2010 2011 CNG LNG Total NGV Station Count Growth Since…
  82. June 2013 Investor Presentation – Encana Corp – slide 82
    2013F ENCANA CORPORATE GUIDANCE US$, U.S. GAAP February 14, 2013 2013F Production (after royalties) Natural Gas (MMcf/d) 2,800 ? 3,000 Oil (Mbbls/d) 22 ? 28 Natural Gas Liquids (Mbbls/d) 28 ? 32 Total Liquids (Mbbls/d) 50 ? 60…
  83. June 2013 Investor Presentation – Encana Corp – slide 83
    Operating Costs ($/Mcfe at 6:1 ratio) Upstream Operating Costs (4) 0.70 Transportation and Processing 1.25 Administrative Expense (4) 0.30 Depreciation, Depletion and Amortization Rate 1.25 2013 Sensitivities (1) ($ millions) Cash…

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