ENCANA CORPORATION Strategic Combination with Newfield Exploration Co. Creating a Leading Multi-Basin Company November 1, 2018
STRATEGIC COMBINATION WITH NEWFIELD EXPLORATION Transaction Creates Leading Multi-Basin Company Transaction Overview Core-of-the-Core Positions in 3 Top North American Plays Consideration: All Stock - 2.6719 shares of Encana for each…
TRANSACTION EXPANDS SHAREHOLDER RETURNS Efficiency, Scale & Accretion Combined Enterprise Value (B)1 Combined Company Overview 13.3 6.3 19.6 Q3 2018 Last Twelve Months Large, high quality positions in 3 top North American…
ENCANA A LEADING MULTI-BASIN COMPANY Delivering Quality Growth and Shareholder Returns Increasing Return of Dividend increase of 25% expected in 2019* Capital to Expand existing buyback to 1.5 billion post closing in 2019**…
TOP POSITIONS IN THE MOST ECONOMIC RESOURCE PLAYS Encanas Core-of-the-Core Multi-Basin Portfolio 80 90% of pro forma production from large Half-cycle WTI breakeven (/bbl) 70 scale, low cost basins 60 50 40 30 20 10…
WORLD CLASS STACK/SCOOP POSITION Enhancing Our Multi-Basin Portfolio World class resource - 3.0BBOE of net un- risked resource Acreage represents the core of the play Large contiguous acreage position with stacked pay across multiple…
HIGH QUALITY RESOURCE POTENTIAL The Right Rocks Thick, porous, laterally extensive reservoir Fits cube development model with 2-4 target benches Oil saturated across a wide oil window Pressure increases deliverability…
2ND LARGEST UNCONVENTIONAL PRODUCER IN NORTH AMERICA Strategic Combination Creates Immediate Scale MBOE/d 700 600 Pro forma Q3/18 production 575 MBOE/d 500 400 300 200 100 0 Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6…
SYNERGY SUMMARY Scale and Cube Development Driving Material Synergies Cube development ideal for commercial development in STACK/SCOOP Cube development synergies of 1MM/well or 125MM/year Rapid transfer of initiatives currently…
SYNERGY SUMMARY High Confidence Synergies Annualized G&A Costs (MM/yr) Cube Development Synergies in STACK/SCOOP 1MM/well savings x 125 net wells = 125MM/year Current Well Cycle Time Pad Supply Completions Well Cost Cost…
STRONG INVESTMENT GRADE COMPANY Credit Positive Transaction Consistent with ECA mid-cycle leverage targets 2019F net debt to Adjusted EBITDA at target of 1.5x Encana Newfield Combined Dividend and share repurchases funded from free…
FURTHER UPSIDE ACROSS CORE PILLARS OF OUR STRATEGY Levers of Additional Value TOP TIER MARKET Top tier resource RESOURCE FUNDAMENTALS High quality multi-basin portfolio provides investment options Best rocks continue to get better…
ENCANA Q3 RESULTS Delivering Efficient Growth in 2018 with Free Cash Flow Expect to meet or beat 2018 targets and generate free cash flow Liquids growth driving higher margins and free cash flow Permian production expected to exceed…
STRONG FINANCIAL PERFORMANCE Q3 Highlights Q3 2018 FCF positive in Q3 Generated 66MM of FCF Net Earnings (MM) 39 Expect full year positive FCF Operating Earnings (MM) 163 Cash flow margin of 16.93/BOE in Q3 and expect 16/BOE Cash…
THE STRATEGY IS WORKING Liquids Growth + Margin Growth = Cash Flow Growth Focused liquids growth Q3 Q2 23 Mbbls/d increase in liquids in the quarter (15% increase) 2018 2018 75% of liquids growth from oil and condensate Liquids…
2018 GUIDANCE UPDATE Free Cash Flow Positive in 2018 On track to deliver liquids growth 2018F Updated Guidance 2018F cash flow margin 16/BOE (14/BOE original) Capital Investment ( billion) 2.0 Driven by high value liquids growth…
ENCANA A LEADING MULTI-BASIN COMPANY Delivering Quality Corporate Returns Core-of-the-Core Positions in 3 Top North American Plays Strategic combination with Newfield to create a leading North American unconventional company…
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