TOP TIER RESOURCE ? 95% of 2016F capital allocated to core four ? 2016 program focused on core acreage in each asset OPERATIONAL EXCELLENCE ? 10-15% D&C cost efficiencies ? Rapid application of innovations across portfolio ?…
? Significant flexibility to adjust capital in 2016 ? Over 90% of capex is discretionary with minimal supply chain commitments ? Continuing to drive efficiencies across portfolio ? 2016F capital down ~$600 million ? 2016F production…
? Expect core four to maintain scale at ~270 MBOE/d Ford, Duvernay & Montney) ? ~12% y-o-y growth ? 2016F program is load-leveled throughout the year ? Core four to generate over 75% of 2016 production ? Up from 33% in 2014 ? Key…
? 2016 program funding ? Combination of expected cash flow & existing credit facilities ? Committed to maintaining investment grade credit rating ? Mid-BBB ratings from Moody?s, S&P and DBRS ? Actively managing balance sheet ?…
1. Well spacing in three dimensions in complex reservoirs 2. Targeting the best pay with advanced reservoir characterization & geosteering 3. Optimizing completions intensity 4. Full life production management 5. Design & logistics…
permian eagle ford duvernay montney capital D&C target well cost well pad vertical 2016
? Top tier asset ? Acreage situated in northern/central sweet spot of the Midland Basin ? Heavily weighted to liquids (~80% of production) ? Stacked resource potential ? Productive intervals spanning over 5,000? of stratigraphy ?…
? Top tier operator after less than a year ? Culture of innovation and operating excellence ? Production up 50% from acquisition ? Enhancing capital efficiency ? Achieving 10 fracs / day ? Fit-for-purpose drilling rigs ? Increased…
? Grow production with 3-5 horizontal rigs ? Maintain land position through vertical drilling program ? Focus on the best rock ? D&C cost target* of $5.9 MM/well
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? Largely contiguous position in the Karnes Trough ? Most active and profitable trend in the Eagle Ford ? Heavily weighted to liquids (85% of production) ? Well inventory improvement ? Graben area success ? Stacked pay and infill…
? Cost reduction achievements ? 33% decrease in D&C costs since acquisition ? Completion days dropped 42% to 3.5 days/well ? Production growth ? 33% increase in production since acquisition ? 30-60% improvement in type curves ?…
? Maintaining production 50-60 MBOE/d ? Enhancing well inventory ? Optimizing completion design for Graben wells ? Confirm chevron downspacing for undeveloped acreage ? Uphole potential ? Upper Eagle Ford results in 2016 ? D&C cost…
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? Encana holds 1/3 of high-graded liquids fairway in the play ? Core fairway in Simonette ? Some of the highest EUR wells in North America* ? Liquids-rich gas and condensate resource play ? >1,000 horizontal well inventory ?…
? Industry-leading operating efficiencies ? Dual rig/dual frac crews per pad ? Water and road infrastructure allowing for year-round operations ? Innovation at work ? Reducing 8 well pad cycle times to ~ 6 months ? Dual drilling…
? Brion (formerly Phoenix, a subsidiary of PetroChina) agreed to invest C$2.18 billion for 49.9% working interest ? C$1.18 billion up front cash in 2012 ? Further investment of C$1.0 billion during the commitment period ? JV carry…
? Drill to fill in 2016 ? Equally weighted program between North and South Simonette ? 10-29 Plant phase 1 start up in Q1 2016 ? 10,000 bbls/d and 50 MMcf/d gross capacity ? D&C cost target* of $9.5 MM/well
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? Large contiguous land position ? Encana acreage in most proven region of the fairway ? Massive running room and scale ? Diverse product mix ? ~5,000 horizontal well inventory ? >1,500 oil and condensate wells in inventory ? Highly…
? Competitive to the Marcellus in well deliverability, cost and economics ? Expecting 50,000 bbls/d of liquids by end of 2018 ? Liquids growth outpaces gas ? Innovation at work ? After a decade of developing, still continues to…
? Partnership with a subsidiary of Mitsubishi ? Encana: 60% interest ? Mitsubishi: 40% interest ? Development areas ? Montney: Tower, Dawson North, Dawson South and Tumbler Ridge ? Cadomin ? Steeprock Doig ? Investment structure…
? Fill existing infrastructure to maintain production ? Development focused in the liquids rich zones and acreage ? Maintain highest quality land position in Alberta ? D&C cost target* of $7.7 MM/well
Dawson South Tower Saturn IP 30 EUR Lateral Condensate Montney
? Capital allocated to deliver quality returns ? Continue to expand margins ? Continue to drive corporate and operating efficiencies ? Significant flexibility ? Proactively managing the balance sheet
? ~$1.3 billion debt repayment in April 2015 ? Debt redemption to save ~$200 million in future interest expense ? Financial flexibility with no debt maturities until 2019
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