Current ECA Stock Info

Encana Corp. (ticker: ECA) is one of the first E&Ps to report it second quarter results. ECA announced a growth of 25% in its margin from the first to the second quarter of 2017.

Douglas Suttles, President and CEO of Encana, indicated that this was due to the increase in the fraction of oil and condensate in its production mix. The company now expects that its core assets will create additional growth, in the amount of 25-30% in Q4, 2017.

Encana averaged 246,500 BOEPD during Q2, which was 9,200 BOEPD higher than the previous quarter. ...

Analyst Commentary

From KLR Group
Our variance in long-term production guidance relative to Encana has narrowed though our ’21 production outlook remains at least 10% below the company’s expectation
Our ’17 production expectation of ~315 Mboepd is at the midpoint of company guidance (310-320 Mboepd). Thereafter, given comparable capital plans, Encana anticipates achieving production of at least 400 Mboepd in ’19 versus our expectation of ~400 Mboepd and at least 500 Mboepd in ’21 (~50% liquids) versus our expectation of ~440 Mboepd in ’21 (~55% liquids).
After appreciable analysis exchange with Encana, the variance in our production outlook appears attributable to the Montney. The difference relates to the company’s view as to the early production deliverability of Montney wells, which Encana assumes are ~1.5x greater than typical unconventional resource early time deliverability.
Economic rank: (1) Montney Pipestone very rich condensate, (2) Montney Dawson North rich gas, Midland Basin Wolfcamp/Spraberry, (3) Eagle Ford, (4) Simonette North/South Duvernay
Midland Basin – Wolfcamp/Spraberry:
Encana is conducting a five-rig Midland Basin program and plans to drill 135-145 net wells and place 120-130 net wells on line this year. Approximately 60% of the company’s drilling activity is in Midland County, ~25% in Howard County and ~15% in Glasscock County. Additionally, Encana plans to test the Wolfcamp C, Middle Spraberry and Joe Mills. Encana’s development scheme contemplates 450’ to 660’ lateral offsets in a chevron pattern. Midland Basin wells (~8,100’ laterals) cost ~$5 million. Wolfcamp A/B and Lower Spraberry wells in Midland/Upton Counties have produced almost 150 Mboe (~70% oil) the initial six months and should recover ~1,000 Mboe. Lower Spraberry wells in Martin County should recover ~900 Mboe (~75% oil). Wolfcamp A/Lower Spraberry wells in Howard County should recover 800-900 Mboe (~75% oil).
WCSB – Montney:
Encana is conducting a seven-rig Montney program (six rigs in Dawson and one rig in Pipestone) and plans to drill 70-80 net wells and place 60-70 net wells on line this year including 10-12 net Pipestone wells.Montney wells (~9,000’ laterals, up to 2,400 lbs/ft proppant) cost ~$4.5 million. In Dawson North, Montney rich-gas condensate wells have averaged ~1,300 Boepd (~65% gas, ~30% condensate, ~5% NGLs) the first 180 days and should recover ~1,750 Mboe. In Pipestone, Montney very rich-gas condensateoil wells have ~1,750 Boepd (~50% condensate) the first 180 days and recover approximately 1,750 Mboe.  

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