EnCana Sells More Assets for US$219 Million

EnCana Corporation has reached agreement to sell conventional natural gas assets producing approximately 7,250 barrels of oil equivalent per day, after royalties, (9,400 barrels of oil equivalent per day before royalties) to a Calgary-based oil and gas producer for approximately US$219 million (C$292 million) before adjustments. The transaction, which is expected to close before August 30, 2004, is comprised of natural gas properties in northeast Alberta with proved reserves estimated to be approximately 66 billion cubic feet, after royalties, as of the July 1, 2004 evaluation. The sale is subject to typical post-closing adjustments.

This sale of mature, non-core assets is part of a divestiture program EnCana announced alongside its acquisition of Tom Brown, Inc. in April. Since then, the company has reached agreements to sell close to US$900 million in assets, producing approximately 28,000 barrels of oil equivalent per day. With this sale, EnCana's proportion of its North American production sourced from long-life, low-decline resource plays reaches approximately 75 percent.

To date in 2004, EnCana has divested of conventional, non-core properties producing about 50,000 barrels of oil equivalent per day for total proceeds of approximately $1.3 billion. Including all 2004 acquisitions and divestitures, EnCana expects to grow production by 15 percent this year to between 725,000 and 765,000 barrels of oil equivalent per day.