Professional Documents
Culture Documents
Doug Suttles
President & Chief Executive Officer
ENCANA IN 2016
Well Positioned for Success
*Resource Play Hub: Encanas development model using repeatable, transferable operations techniques to reduce costs and improve safety and environmental performance. 2
ENCANA
Montney
Multi-Basin Portfolio Advantage 10,000 well locations
Duvernay
1,000 well locations
ENCANA CORPORATION
EXECUTION EXCELLENCE
Michael McAllister
EVP & COO
ENCANAS EXECUTION EXCELLENCE
Basin Leading Operator
INNOVATION
CONTINUOUS IMPROVEMENT
BASIN
LEADING
OPERATOR
PORTFOLIO ADVANTAGE
DISCIPLINED BENCHMARKING
TO COMPETITORS
5
INNOVATION AT A GLANCE
Driving Efficiency Across the Portfolio
6
ENCANA MONTNEY
Development History
2009 - 2011
MMcf/d
HZ development of 2013 - 2016
1,000 BC Montney Focus on condensate rich areas
Completions design
2006 2012 optimization
Cutbank Ridge Veresen KKR infrastructure deal
First HZ well drilled
Partnership (CRP) joint
750 2007 - 2008 venture with Mitsubishi
Land capture in Pipestone
HZ development in
Gordondale
Prior to 2003 2003 - 2005
500 Conventional
Unconventional Montney
resource evaluation
vertical
Land capture in Montney BC
development
250
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
7
1,000
2,500
800
Rate (BOE/d)
2,000
(MMcf/d)
0 0.00 0
0 60 120 180 240 300 360
Producing Days
Peer acreage sourced from RS Energy Group, Inc. & Company Presentations 8
ENCANA CORPORATION
FUNDAMENTALS
Renee Zemljak
EVP Midstream, Marketing & Fundamentals
David Thorn
Vice President, Marketing Northern Operations
12
-4
2016F 2017F 2018F 2019F 2020F
Power Other Residental/Commercial Industrial Export to Mexico Gulf Coast LNG Total Supply
West Midwest
1.6 2.0 Northeast
3.0
0.8 1.2 1.0 1.7
1.1 1.5 2.6
0.0 0.5
0.0 1.0
2010-2015 2015-2020 2010-2015 2015-2020 0.0
2010-2015 2015-2020
Bcf/d
10 10%
8 8%
6 6%
4 4%
2 2%
0 0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Montney Montney % of NA
Source: Encana Fundamentals, IHS 12
NORTH AMERICAN NATURAL GAS FUNDAMENTALS
Montney - Highly Competitive Break-even Cost
Break-even
($/MMBtu)
$6.50
$6.00
$5.50
$5.00
$4.50
$4.00
$3.50
$3.00
$2.50
$2.00
Arkoma Fayetteville Piceance Utica Haynesville Marcellus Deep Basin Montney
Woodford
2012 2013 2014 2015 Current
Source: Encana Fundamentals, Baker Hughes (U.S. rigs), IHS (Canadian rigs) 14
WESTERN CANADIAN MARKET FUNDAMENTALS
Natural Gas Export Basin Premium Condensate Market
Bcf/d
20 45%
Historical peak production Forecast
18 40% Montney expected
16 35% to grow to 7 Bcf/d in
14
30% 2020, representing
12
25%
38% of WCSB
10 production
20%
8
15%
Montney expected
6
to lead WCSB
4 10%
growth back toward
2 5%
2006 historical peak
0 0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Bcf/d
8
Forecast
7
>1 Bcf/d of growth from oil
6 sands & power sector expected
through 2020
5
Strong historical local demand
4 growth has reduced reliance on
total takeaway capacity
3
Demand growth plus base
2 declines add ~1.8 Bcf of
incremental market
1
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Source: Encana Fundamentals *Required Exports = Expected Supply Minus Expected Demand 18
WESTERN CANADIAN NATURAL GAS FUNDAMENTALS
What is AECO?
AECO BASIS
Price-Setting Mechanism
Bcf/d WCSB Required Exports & Contracted Capacity
8.0
7.0
6.0
5.0
4.0
Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16
$US/MMbtu
$0.50
AECO basis has historically
averaged $(0.50)
$0.00
Basis has recovered rapidly
when it has widened before
($0.50)
The market sees a
directional return toward
($1.00)
historical levels
($1.50)
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
11
10
6
2015 2016F 2017F 2018F 2019F 2020F
Source: Encana Fundamentals *Required Exports = Expected Supply minus Expected Demand 23
Montney continues to
compete in Western
markets, capturing
demand growth and
offsetting declines in the Northeast U.S. production
region will continue to capture
South and Southeastern
demand via existing
Existing Infrastructure pipelines and shorter
Greenfield Infrastructure greenfield connectivity
25
ENCANA CORPORATION
RESOURCE IN CONTEXT
David Hill
EVP Exploration & Business Development
Blair Porter
Advisor, Engineering Exploration & Business Development
MONTNEY MOST ACTIVE GAS PLAY
Q1 2016 Average Rig Activity
Montney
1Q16 Rig
Play
Activity Rockies
Montney 54
Marcellus/Utica 46
Rockies 33 Haynesville
Haynesville 17
Gas Wells
Oil Wells
Oil and Gas Wells
Sources: IHS, DrillingInfo, Nickles, EIA
Active Rigs data as of March 2016
Active Rigs
27
Tower
British Columbia
Dawson
Alberta
Pipestone
Siltstone reservoir
South
Not a shale
High quality condensate & gas
980 Hydrocarbon Bearing Reservoir
AA A B C D
E
regions
F
Robust performance across all
fluid windows
G
Multiple stacked zones
H
Gas
Deposited in thick, stacked layers
SEXSMITH
Condensate Rich
Super Condensate Basal
28
MONTNEY REGIONAL SCALE
Areal Extent Same as Marcellus
Montney Marcellus
Alberta
Size and scale of Montney
same as Marcellus
Montney condensate
window larger and richer
British Columbia
Alberta
0 Miles 20
Peer Acreage
Encana Acreage
Peer acreage sourced from RS Energy Group, Inc. & Company Presentations 30
MONTNEY RESOURCE POTENTIAL
Stacked Zones Comparable to the Permian
Montney (350 miles) Permian Midland Basin (100 miles)
Upper Montney to Base Sexsmith Middle Spraberry to Base Wolfcamp C
SE
NW
NW
SE
1,000
2,000
50 to 200 Bcf/section
Up to 6 stacked laterals
>150 MMbbls/section
>8 stacked laterals
MONTNEY PLAY
Three Distinct Regions
Northwest Northwest
940 Hz wells drilled; 265 in 2015
Alberta
Source: IHS 32
MONTNEY REGIONAL SCALE
Encanas Acreage is in the Core of the Basin
Alberta
Central
NW
Northwest
CROSS-SECTION OF THE MONTNEY
Stacking Adds Scale Central
Southeast
SE
1,000
NW
SE
Central 6
(Normalized to 8,200)
Gas Rate (MMcf/d)
4
12
10
Central
(Normalized to 8,200)
Gas Rate (MMcf/d)
6
Encana 2015 Montney
4 (25 Wells)
12
8
Marcellus NE Core
Encana 2015 Montney
4 Marcellus SW Core
0
0 1 2 3 4 5 6 7
Cumulative Gas Production (Bcf)
(Normalized to 8,200)
Source: IHS, Encana data 37
Montney 30 Day Peak Condensate Rates by Region Encana Recent Condensate Well Results
(Normalized to 8,200)
(~2,080 BOE/d)
Gas Rate (Mcf/d)
600
5,000
Tower (Condensate area 10 - 100 bbls/MMcf)
500
4,000
400
370 bbls/d of condensate & 5.5 MMcf/d
3,000 (~1,320 BOE/d)
300
2,000
Dawson South (Condensate area 10 100 bbls/MMcf)
200
500 bbls/d of condensate & 8.4 MMcf/d
100 1,000
(~1,900 BOE/d)
0 0
SE Central Central Central
Super Condensate Area Condensate Area Gas Area
>100 bbls/MMcf 10-100 bbls/MMcf 0-10 bbls/MMcf
Source: IHS (data limited to wells with substantial liquids volumes reported in condensate areas) 38
STACKED RESOURCE POTENTIAL
10,000 Inventory Locations
Stacking Development Layers (#)
39
ENCANA CORPORATION
Development Plans
Jim Roberts
Vice-President & General Manager, Northern Operations
ENCANA IN THE MONTNEY
A Premier North American Play
Large resource poised for significant growth Tower
Growing net production to over 75,000 bbls/d and 1.8 Bcf/d by 2026 36% Super-Condensate
(>100 bbls/MMcf)
42
ENCANA IN THE MONTNEY
Drilling & Completions
10,000 2006 2016
Lateral length (ft)
8,000
6,000
4,000
Lateral Length
2,000 Increased ~2X
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
2,000
Proppant (lb/ft)
1,500
Proppant Loading
1,000
Increased ~4X
500
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
1.25
Completions
Drilling and Completion Cost*
D&C Cost ($/1,000)
1.00
Drilling
0.75
Decreased 50%
0.50
0.25
0.00
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2016F
1200
IP30
IP30 (BOE/d)
800
400
Increased ~5X
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
2,000
1,500 EUR
EUR (MBOE)
1,000
Increased ~8X
500
-
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
$8
22
$7
$6 F&D
F&D ($/BOE)
$5
$4 Reduced ~6X
$3
$2
$1
$0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
45
Tower
CONDENSATE (10-100 bbls/MMcf)
Tower
2016 Drill 2-12 Pad
3,000 Type Curve 5-1 Pad
IP180 Condensate = 370 bbls/d
IP180 Gas = 5.4 MMcf/d
EUR = 1.2 MMBOE
2,500 D&C = $4.4 MM
Lateral Length = 8,000 ft 50 to >100 bbls/MMcf
1,500
5mi / 8km
1,000
Type Well Metrics ECA Net
Leveraged Unleveraged
500 Btax IRR (%) >200 80
Type Curve
Btax Payout (Months) 10 16
Actuals
Operating Margin ($/BOE) 14 14
0
0 30 60 90 120 150 180 2 Year Free Cash Flow ($MM) 2.5 1.0
Producing Days
Saturn
3,000 Type Curve
IP180 Condensate = 350 bbls/d
IP180 Gas = 7.5 MMcf/d
EUR = 1.3 MMBOE
2,500 D&C = $4.3 MM 4-2, 6-2, 8-2 Pads
Lateral Length = 8,200 ft 2016 Drill
16-28
2,000 After 8 months 70% higher than type curve
Rate (BOE/d)
Producing Days
All metrics based on $3.0/MMBtu NYMEX, $50/bbl WTI, and $0.75 FX 47
Dawson South
New E4-17 Lower Montney IP Lower Montney Type Curve
3,000 9-35 Pad
23% condensate IP180 Condensate = 350 bbls/d
67% above type curve IP180 Gas = 7.1 MMcf/d
2016 Drills
EUR = 2.1 MMBOE 10-100 bbls/MMcf 14-19 Pad
2,500 D&C = $5.2 MM 12-23 Pad
Lateral Length = 9,800 ft 2016 Drills
4-17 Pad
1,000
Lower Montney Type Well Metrics ECA Net
Leveraged Unleveraged
500 Lower Montney Type Curve Btax IRR (%) >200 105
Lower Montney Actuals Btax Payout (Months) 10 14
Upper Montney Actuals
Operating Margin ($/BOE) 12 12
0
0 60 120 180 240 300 360 2 Year Free Cash Flow ($MM) 3.8 2.1
Producing Days
3,000
2-15
>100 bbls/MMcf
Rate (BOE/d)
1,500
5mi / 8km
1,000
Super - Super -
Region Gas Condensate Condensate
Condensate Condensate
IP30 (BOE/d) 1,500 - 2,000 1,400 - 1,800 900 - 1,100 1,850 - 2,050 600 - 800
IP180 (BOE/d) 1,400 - 1,700 1,300 - 1,700 800 - 1,000 1,450 - 1,650 900 - 1,100
EUR/Well (Bcfe) 9 - 11 7-9 5.5 - 6.5 12 - 14 5.5 - 7.5
EUR/Well (MBOE) 1,600 - 1,800 1,250 1,500 900 - 1,100 2,000 - 2,300 900 - 1,200
Condensate Yield (bbls/MMcf) <10 10 - 100 >100 10 - 100 >100*
D&C Cost/well ($MM) 4.9 4.9 4.9 4.9 4.9
Average Lateral Length (ft)** 8,200 8,200 8,200 8,200 8,200
Total Gross Inventory 3,400 2,400 1,100 1,200 1,900
Estimated inventory based on 440 - 880 ft spacing. *Alberta Super-Condensate averages >300 bbls/MMcf **Actuals vary between 7,800-9,900 50
MONTNEY PRODUCERS AT A GLANCE
Encana is the Largest Producer
1,200
Gross Operated Production (MMcf/d)
1,000
800
600
400
200
Peer acreage sourced from RS Energy Group, Inc. & Company Presentations
Rig Count AAV APA ARC BIR CNRL COP Encana MUR NVA Other PPY Progress 7Gen RDS TOU Total
2015Q4 1 1 1 1 0 1 1 1 2 17 1 13 9 3 2 54
2016Q1 1 2 1 2 2 1 3 1 2 15 3 10 7 3 1 54
Source : Industry data. Rig counts displayed for the most active and key peers. 51
6,000
~35 % greater than industry average
4,000
Continuous improvement and innovation 2,000
to reduce costs 0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Bit design & optimization
Encana Industry Average
High performance motors
2014-15 Drilling Cost Comparison
Vendor sourcing for volume discounts
0.8 0.8
Fluid system evolution Southeast Central
Drilling Cost (MM$/1000)
Drilling Cost (MM$/1000)
0.6 0.6
Load leveling
Competitor benchmarking 0.4 0.4
0.0 0.0
Source : Industry Data: The Well Completions and Frac Database (Canadian Discovery) and Industry Report 52
Tower
Cluster density 5 2
0.20 Completion Type Cased Cased
ECA Tower wells
*Tower specific average
0.00 outperform IRR by 35%
Tower Peer ECA Tower 2016 Pacesetter and payout 10% faster
Saturn
ENCANA MONTNEY VS. COMPETITORS
Saturn Performance and Economics
2014-15 Completion Cost/1,000 in Saturn Completion Comparison
0.80 Encana Peer*
Completion Cost ($MM/1,000)
Cluster density 5 -
0.20 Completion Type Cased Open Hole
*Saturn specific average ECA Saturn wells
0.00 outperform IRR by 70%
Saturn Peer ECA Saturn 2016 Pacesetter and payout 20% faster
Liquids (bbls/d)
Gas (MMcf/d)
1,200 75,000
Capital focused on higher return D&C activities vs.
1,000
facilities
800 50,000
Enables double the production growth
600
Generates superior financial returns
400 25,000
Free cash flow positive 2017+
200
$700 MM free cash flow per year within a decade
0 0
Resilient to commodity prices 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
55
INFRASTRUCTURE PLAN
Building Flexibility for Growth
Encana utilizing ~1.0 Bcf/d of processing capacity Fort St. John
Spectra
Midstream Limited Partnership (VMLP) BC Station 2
Saturn 15-27
Dawson Dawson
Creek AltaGas
Phase 2
Processing capacity expansions underway
Gordondale
Gathering $1 MM/MMcf/d
gas processing $400
Gathering, compression,
and liquids handling + $240
Total Cost (MM$ USD) $640
Gas
Well Head Liquids Handling Compression Processing Sales Meter
57
*Sources include any Encana or third party production routed through VMLP funded facilities 58
INFRASTRUCTURE STRATEGY
Capital Efficiency Driving Higher Production Growth
Midstream strategy allows Encana to focus capital on higher return D&C activities vs. facilities
Delivers 2x growth
60
1,000
40
500
20
0 0
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Self Build = Theoretical Encana self build scenario where Encana incurs all facility construction costs 59
INFRASTRUCTURE STRATEGY
Growth Driving Incremental Value ECA vs Self Build: Income Margin and Cum. Op. Cash Flow
$20 Notes
$8,000
Material improvements to cash flow and I.
II.
Plot includes existing production
Income Margin is Operating Margin less F&D
Self Build = Theoretical Encana self build scenario where Encana incurs all facility construction costs 60
MONTNEY DEVELOPMENT PLAN
Free Cash Flow Generator Capital vs. Cash Flow at $50 WTI and $3.00 NYMEX
$MM
$1,600
$800
$400
$-
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Self Build = Theoretical Encana self build scenario where Encana incurs all facility construction costs Development Capital Operating Cash Flow 61
ENCANA MONTNEY
Positioned for Growth Development Plan & Upside* Growth Forecast
4,000 150,000
the Montney
100,000
10,000 wells to drill 2,500
Estimated inventory based on 440 - 880 ft spacing *Upside scenario includes an incremental ~1,200 locations. 62
DELIVERING QUALITY RETURNS FROM A PREMIER ASSET
Although Encana believes the expectations represented by such FLS are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions, risks and uncertainties
referenced above are not exhaustive. FLS are made as of the date of this presentation and, except as required by law, Encana undertakes no obligation to update publicly or revise any FLS. The FLS contained in this presentation
are expressly qualified by these cautionary statements.
Certain future oriented financial information or financial outlook information is included in this presentation to communicate current expectations as to Encanas performance. Readers are cautioned that it may not be appropriate for
other purposes. This presentation may contain references to non-GAAP measures, which do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other companies.
These measures are presented to provide shareholders and potential investors with additional information regarding Encanas liquidity and its ability to generate funds to finance its operations. Rates of return for a particular play or
well are on a before-tax basis and are based on specified commodity prices with local pricing offsets, capital costs associated with drilling, completing and equipping a well, field operating expenses and certain type curve
assumptions. Pacesetter well costs for a particular play are a composite of the best drilling performance and best completions performance wells in the current quarter in such play and are presented for comparison purposes relative
to other companies.
For convenience, references in this presentation to Encana, the Company, we, us and our may, where applicable, refer only to or include any relevant direct and indirect subsidiary corporations and partnerships
(Subsidiaries) of Encana Corporation, and the assets, activities and initiatives of such Subsidiaries.
64
ADVISORY REGARDING RESERVES DATA & OTHER OIL & GAS INFORMATION
National Instrument (NI) 51-101 of the Canadian Securities Administrators imposes oil and gas disclosure standards for Canadian public companies engaged in oil and gas activities. Encana complies with NI 51-101 disclosure
requirements in its most recently filed annual information form (AIF). Detailed Canadian protocol disclosure is contained in Appendix A and under Narrative Description of the Business of the AIF. Certain disclosure is also
prepared in accordance with U.S. disclosure requirements as set forth in Appendix D of the AIF. A description of the primary differences between the disclosure requirements under Canadian standards and under U.S. standards is
set forth under the heading Reserves and Other Oil and Gas Information in the AIF. Additional detail regarding Encanas economic contingent resources disclosure is available in the Supplemental Disclosure Document filed
concurrently with the AIF.
All estimates are effective as of December 31, 2015, are derived from reports prepared by independent qualified reserves evaluators engaged by Encana and are prepared in accordance with procedures and standards contained in
the Canadian Oil and Gas Evaluation Handbook (COGEH), NI 51-101 and SEC regulations, as applicable. Information on the forecast prices and costs used in preparing the estimates are contained in the AIF. For additional
information relating to risks associated with the estimates of reserves and resources, see Risk Factors in the AIF.
Reserves are the estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, from a given date forward, based on: analysis of drilling, geological,
geophysical and engineering data, the use of established technology, and specified economic conditions, which are generally accepted as being reasonable. Proved reserves are those reserves which can be estimated with a high
degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. Probable reserves are those additional reserves that are less certain to be recovered than
proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. Possible reserves are those additional reserves that are less
certain to be recovered than probable reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves. Contingent resources do not constitute,
and should not be confused with, reserves. Contingent resources are defined as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or
technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. There is uncertainty that it will be commercially viable to produce any portion of the
resources. All of the resources classified as contingent are considered to be discovered, and as such have been assigned a 100% chance of discovery, but have however been risked for the chance of development. The chance of
development is defined as the likelihood of a project being commercially viable and development proceeding in a timely fashion. Determining the chance of development requires taking into consideration each contingency and
quantifying the risks into an overall development risk factor at a project level. Contingent resources are categorized as economic if those contingent resources have a positive net present value under currently forecasted prices and
costs. In examining economic viability, the same fiscal conditions have been applied as in the estimation of Encanas reserves. Contingencies include factors such as required corporate or third party (such as joint venture partners)
approvals, legal, environmental, political and regulatory matters or a lack of infrastructure or markets.
Encana uses the terms play, resource play, total petroleum initially-in-place (PIIP), natural gas-in-place (NGIP), and crude oil-in-place (COIP). Play encompasses resource plays, geological formations and conventional plays.
Resource play describes an accumulation of hydrocarbons known to exist over a large areal expanse and/or thick vertical section, which when compared to a conventional play, typically has a lower geological and/or commercial
development risk and lower average decline rate. PIIP is defined by the Society of Petroleum Engineers - Petroleum Resources Management System (SPE-PRMS) as that quantity of petroleum that is estimated to exist originally in
naturally occurring accumulations. It includes that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production plus those estimated quantities in accumulations yet to be
discovered (equivalent to total resources). NGIP and COIP are defined in the same manner, with the substitution of natural gas and crude oil where appropriate for the word petroleum. As used by Encana, estimated ultimate
recovery (EUR) has the meaning set out jointly by the Society of Petroleum Engineers and World Petroleum Congress in the year 2000, being those quantities of petroleum which are estimated, on a given date, to be potentially
recoverable from an accumulation, plus those quantities already produced therefrom.
In this presentation, Encana has provided information with respect to certain of its plays and emerging opportunities which is analogous information as defined in NI 51-101. This analogous information includes estimates of PIIP,
NGIP, COIP or EUR, all as defined in the COGEH or by the SPE-PRMS, and production type curves. This analogous information is presented on a basin, sub-basin or area basis utilizing data derived from Encana's internal sources,
as well as from a variety of publicly available information sources which are predominantly independent in nature. Production type curves are based on a methodology of analog, empirical and theoretical assessments and workflow
with consideration of the specific asset, and as depicted in this presentation, is representative of Encanas current program, including relative to current performance. Some of this data may not have been prepared by qualified
reserves evaluators or auditors, may have been prepared based on internal estimates, and the preparation of any estimates may not be in strict accordance with COGEH. Estimates by engineering and geo-technical practitioners
may vary and the differences may be significant. Encana believes that the provision of this analogous information is relevant to Encana's oil and gas activities, given its acreage position and operations (either ongoing or planned) in
the areas in question, and such information has been updated as of the date hereof unless otherwise specified. Due to the early life nature of the various emerging plays discussed in this presentation, PIIP is the most relevant
specific assignable category of estimated resources. There is no certainty that any portion of the resources will be discovered. There is no certainty that it will be commercially viable to produce any portion of the estimated PIIP,
NGIP, COIP or EUR. Disclosure regarding drilling locations is based on internal estimates, may include proved, probable and unbooked locations, and assume a number of wells that can be drilled per section based on industry
practice and/or internal review. The drilling locations which Encana will actually drill will ultimately depend upon the availability of capital, regulatory and partner approvals, seasonal restrictions, oil and natural gas prices, costs,
actual drilling results, additional reservoir information that is obtained and other factors.
30-day IP and other short-term rates are not necessarily indicative of long-term performance or of ultimate recovery. The conversion of natural gas volumes to barrels of oil equivalent (BOE) is on the basis of six thousand cubic feet
to one barrel. BOE is based on a generic energy equivalency conversion method primarily applicable at the burner tip and does not represent economic value equivalency at the wellhead. Readers are cautioned that BOE may be
misleading, particularly if used in isolation.
65