2015 CORPORATE GUIDANCE Encana Corporation December 16, 2014
2015 Program Aligned with Strategy On Track to Meet Long Term Strategic Goals Vision: LEADING NORTH AMERICAN RESOURCE PLAY COMPANY Focused on developing four of the highest quality assets in North America with industry leading…
2015 Program Aligned with Core Competencies Designed to Deliver Margin Growth Top Tier Resource Robust supply costs…
Portfolio Transition 2 Years Ahead of Schedule Shifting the Commodity Mix to Higher Value Products Production Mix (6:1) Operating Cash Flow Mix (excl. hedging) 5% 5% 10% 20% 20% 20% 25% 65% 55% 25% 90% 60% SDT 2017 2013 2015F…
2015 Guidance Key Elements Demonstrating Business Model Sustainability Preserving balance sheet strength a key focus 800 million in divestiture proceeds expected in Q1 2015 No plans to add new debt Conservative 2015 capital program…
Capital Focused on Strategic Growth Assets 80% of 2015F Capital Allocated to Top Four Assets Exercising Disciplined Capital Allocation 2013 2014F 2015F Permian, Eagle Ford, Montney, Duvernay DJ Basin, San Juan, TMS Base and…
Generating Value Through Margin Growth Robust Asset Base Supports Portfolio Resiliency 30 110 Portfolio transition has reset the commodity mix to a greater proportion of higher margin oil 25 100 and NGLs 20 90 Further margin…
2015 Plan Strong Liquids Growth Continues Deliver profitable growth Total Liquids Production Growth of 3x 2013 2015F* Strong 70% y-o-y liquids production growth 45% 180 70% liquids high value field condensate and oil 40% 160…
2015 Program Focused on 4 Key Growth Assets Strong Returns with Visible Long Term Growth 80% of 2015F capital focused on Montney Liquids rich Montney, Duvernay, Eagle Ford & Permian Duvernay High value condensate These four…
Permian Acceleration of a World Class Basin Well-Positioned Relative to 2015 Plan Producing Horizons Smooth, efficient integration of assets and staff Position Encana to be among the best operators in the play Grow annualized…
Eagle Ford Optimization of High Margin Oil Play 2015 Plan Accelerate seamless transition of assets from previous operator Position Encana to be among the best operators in the play Increase liquids production to 45 Mbbls/d Focus…
Montney High Value Liquids and Low Cost Natural Gas Production 2015 Plan Type Curve Changes: 3-21 Pad 14 Maximize well deliverability and accelerate payout Advance new completion design to increase frac size, reduce 12 well spacing…
Duvernay Industry Leading Execution 2015 Plan Accelerate development in Simonette 30 Well Costs - Simonette 6.0 Grow liquids production by 200% y-o-y 5.5 25 5.04 Normalized Well Cost MM/1,000 ft lateral Continue to reduce well…
Disciplined Focus on Profitable Growth VISION: Leading North American oil and gas resource play company High quality rocks Scale and running room Operational excellence Portfolio optionality STRATEGY: Disciplined focus on…
Supplemental
The Permian Transformative Acquisition in World Class Basin Why we like it Premiere position in the Midland Basin 140,000 net acres Potential estimated recoverable resource of 3 billion BOE Strongly accretive, accelerates portfolio…
The Permian Key Statistics Land (net acres): 140,000 Average working interest: 90% RPH type curve EUR/well: 650 800 Mboe RPH type curve ROR: 35% 70% Well inventory (gross): 5,000 RPH well costs (DCT): 7.7 8.5 million Royalty rate: 20 25%…
Eagle Ford Core Position in a Premier Oil Play Why we like it Largely contiguous position in the Karnes Trough Core of the core of the Eagle Ford Acreage primarily lies in the condensate / volatile oil window Most active and…
Eagle Ford Key Statistics Land (net acres): 45,500 Average working interest: 97% RPH type curve EUR/well: 250 700 Mboe RPH type curve ROR: 50% 90% Well inventory (gross): 400 RPH well costs (DCT): 7 8 million Royalty rate: 20 25% 2015F…
Montney Decades of Low Cost Inventory Why we like it Massive running room and scale Potential of 2 Bcf/d and 50,000 bbls/d on Encana lands 25 years of drilling inventory Large contiguous core land positions Encana acreage in most…
Montney Key Statistics Land (net acres): 611,000 Average working interest: 81% Oil wells 800 1,000 Mboe Type Curve EUR/well: Gas Wells 9 12 Bcfe Type Curve ROR: 40 100% Well inventory (gross): 3,700 Well costs (DCT): 8 10 million…
Montney Cutbank Ridge Partnership (CRP) Partnership with Mitsubishi Encana 60% interest Tower Mitsubishi, 40% interest Development areas Dawson North Montney: Tower, Dawson North, Dawson South and Tumbler Ridge Dawson Cadomin…
Duvernay Premier Position in World Class Reservoir Why we like it Massive resource Estimated total resource of 443 Tcf gas, 11.3 Bbbls NGLs, 61.7 Bbbls oil (source: ERCB; medium case) Huge potential growth engine for Encana, capable…
Duvernay Key Statistics Land (net acres): 250,000 Average working interest: 50% RPH type curve EUR/well: 1,000 1,200 MBoe RPH type curve ROR: 90% Well inventory (gross): 1,400 1,450 RPH well costs (DCT)(1): 12 20 million(1) Royalty rate:…
Duvernay Joint Venture Phoenix (subsidiary of PetroChina) agreed to invest C2.18 billion for 49.9% working interest C1.18 billion up front cash in 2012 A further investment of C1.0 billion during the commitment period
DJ Basin Delivering High Margin Liquids Production Today Why we like it Light oil play with significant scale Encana in heart of the Wattenberg field Strong economics - oil and condensate make up 70% of total liquids Significant…
DJ Basin Key Statistics Land (net acres): 49,000 Average working interest: 50% Type Curve EUR/well: 325 550 MBoe Type Curve ROR: 55 85% Well inventory (gross): 600 1,000 Well costs (DCT): 4.5 6.0 Royalty rate: 18 20% 2015F Production…
San Juan First Mover in New Oil Play Why we like it Light, sweet oil play discovered by Encana Capable of producing 50,000 boe/d Dominant operator in the play Strong economics, ability to apply scale Consistent well performance at…
San Juan Key Statistics Land (net acres): 182,000 Average working interest: 54% RPH type curve EUR/well: 400 600 Mboe RPH type curve ROR: 45% 70% Well inventory (gross): 700+ RPH well costs (DCT): 4 5 million Royalty rate: 20% 2015F…
Tuscaloosa Marine Shale Massive Oil Resource, Ideal for Execution at Scale Why we like it Emerging oil asset with massive upside potential Estimated 4 - 5 BBOE of PIIP Potential to produce 50,000 bbls/d 80% of Encanas 200k net acres…
Tuscaloosa Marine Shale Key Statistics Land (net acres): 200,000 Average working interest: 60% RPH type curve EUR/well: 600 700 MBoe RPH type curve ROR: 20% 40% Well inventory (gross): 800 RPH well costs (DCT): 11 13 million Royalty…
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