EnCana's first quarter cash flow reaches US$1.41 billion, or $3.11 per share – up 46 percent per share

Total natural gas, oil and NGLs sales per share up 8 percent Quarterly dividend increased 50 percent to 15 cents per share

CALGARY, April 27 /CNW/ - EnCana Corporation's (TSX & NYSE: ECA) first
quarter 2005 total cash flow per share increased 46 percent to US$3.11 per
share diluted, or $1.41 billion, compared to the first quarter of 2004. Cash
flow and operating earnings rose due to increased sales, higher natural gas
and liquids prices and strong operating performance during the first quarter.
Total operating earnings increased 34 percent per share to $1.34 per share
diluted, or $611 million, compared to the first quarter of 2004. First quarter
sales of natural gas, oil and natural gas liquids (NGLs) from total operations
increased 8 percent per share from the first quarter of 2004. Sales were
4.52 billion cubic feet of gas equivalent (Bcfe) per day. EnCana's first
quarter net earnings were impacted by an unrealized after-tax loss due to
mark-to-market accounting of all hedges, which run primarily through 2006.
This resulted in a first quarter net loss from total operations of 10 cents
per share diluted, or $45 million.

EnCana increases quarterly dividend 50 percent to 15 cents per share

Given EnCana's strong financial and operating performance, the board of
directors has increased the quarterly dividend 50 percent from 10 to 15 cents
per share, on a pre-split basis, which is payable on June 30, 2005 to common
shareholders of record as of June 15, 2005.
"In the past several months, the market has recognized the merits of our
sharpened focus on profitable, long life North American resource plays. Our
unconventional strategy is delivering strong shareholder value. Along with
disciplined capital investment in our large portfolio of resource plays, we
are returning capital to shareholders through share buybacks and today's 50
percent dividend increase as we work to build the net asset value of every
EnCana share," said Gwyn Morgan, EnCana's President & Chief Executive Officer.

IMPORTANT NOTE: EnCana reports in U.S. dollars and follows U.S.
protocols, which report sales and reserves on an after-royalties basis. All
dollar figures are U.S. dollars unless otherwise noted. EnCana is treating the
U.K. and Ecuador operations as discontinued because the U.K. operations were
sold in December 2004 and EnCana plans to sell its Ecuador assets. Total
results, which include results from Ecuador in 2005 and from the U.K. in prior
periods, are reported in the company's financial statements included in this
news release and in supplementary documents posted on its Web site -
www.encana.com.

<<
-------------------------------------------------------------------------
Q1 2005 Financial and Operating Highlights
-------------------------------------------------------------------------
Continuing operations Total operations
-------------------------------------------------------------------------
Cash flow per share diluted $2.88, up 50% $3.11, up 46%
Operating earnings per share
diluted $1.14, up 15% $1.34, up 34%
Net (loss) per share diluted $(0.28) $(0.10)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Natural gas sales 3.15 Bcf/d, up 17% 3.15 Bcf/d, up 16%
Oil and NGLs sales 157,000 bbls/d, 230,000 bbls/d,
down 5% down 13%
-------------------------------------------------------------------------
Total sales on Bcfe basis 4.1 Bcfe/d, up 11% 4.5 Bcfe/d, up 5%
-------------------------------------------------------------------------
Total Mcfe sales, per 1,000
shares 825 Mcfe, up 14% 913 Mcfe, up 8%
-------------------------------------------------------------------------
-------------------------------------------------------------------------

All references in the remaining text of this news release are on a
continuing operations basis.

Continuing operations: Cash flow up 50 percent per share; Operating
earnings up 15 percent per share

EnCana's first quarter 2005 cash flow per share from continuing
operations increased 50 percent to $2.88 per share diluted, or $1.31 billion,
compared to the same period in 2004. First quarter cash flow from continuing
operations includes a cash tax provision of $225 million, which is consistent
with the company's 2005 guidance. Operating earnings from continuing
operations per share increased 15 percent to $1.14 per share diluted, or
$518 million, compared to the first quarter of 2004. EnCana's first quarter
net earnings from continuing operations were reduced by $628 million, after-
tax, as a result of the unrealized mark-to-market accounting standard
governing price risk management activity. About one-third of the
mark-to-market loss is attributed to price hedges put in place in the spring
of 2004, relating to the acquisition of Tom Brown, Inc. The Tom Brown volumes
were hedged through 2006 as a prudent financial measure to help lock in strong
returns on the 2004 acquisition. The balance primarily applies to other oil
and gas hedges running through 2006. First quarter net earnings also include
an after-tax unrealized loss of $15 million due to translation of U.S. dollar
denominated debt issued in Canada. These unrealized hedging and currency
losses resulted in a net loss from continuing operations of 28 cents per share
diluted, or $125 million, compared to net earnings of $326 million in the same
2004 period.

Sales from continuing operations up 14 percent per share

First quarter sales of natural gas, oil and NGLs from continuing
operations increased 14 percent per share from the first quarter of 2004.
First quarter sales were 4.09 Bcfe per day.
"A successful winter of drilling across our Canadian resource plays, the
continued development of our expanded assets in the U.S. and increasing demand
and prices for natural gas and oil have combined to generate strong first
quarter cash flow and operating earnings for EnCana. Despite a number of
weather related setbacks in the quarter, we are on track in 2005 to meet our
sales guidance. Natural gas production from EnCana's North American resource
plays is expected to drive a steady climb during the next three quarters
towards achieving 2005 sales of between 3.35 billion and 3.50 billion cubic
feet of natural gas per day," Morgan said.
"We continue to focus on efficient execution in the development of our
key long-life North American resource plays, where daily production has
increased 23 percent in the past year. By applying rigorous capital discipline
and adding new efficiencies each year, we are achieving strong returns from
these plays," Morgan said.

Natural gas sales from continuing operations up 20 percent per share in
past year

EnCana's first quarter natural gas sales from continuing operations
increased 20 percent per share to 3.15 billion cubic feet per day compared
with the first quarter of 2004. Oil and NGLs sales from continuing operations
of 157,000 barrels per day decreased 3 percent per share, due to the sale of
conventional oil properties during 2004. Operating costs from continuing
operations were 64 cents per thousand cubic feet of gas equivalent (Mcfe),
which is slightly higher than the company's full year forecast range due
mainly to the impact of an appreciating Canadian dollar. EnCana expects full
year operating costs to be within guidance of 55 to 60 cents per Mcfe. First
quarter capital investment was $1.5 billion. EnCana drilled 1,352 net wells
during the first quarter, about one-quarter of its 2005 forecast of between
5,000 and 5,500 net wells. At the end of March 2005, the company had about
1,500 gas wells awaiting tie-in.

EnCana updates Unbooked Resource Potential: 19 trillion cubic feet of
gas, 900 million barrels of oil & NGLs

Resource plays typically have huge long term potential beyond currently
producing wells. EnCana's Total Resource Portfolio consists of its proved
reserves and its Unbooked Resource Potential. Proved reserves are estimated by
independent evaluators in accordance with regulatory standards and industry
best practices. EnCana engineers have recently updated the company's Unbooked
Resource Potential effective December 31, 2004. In 2004, EnCana's proved
reserves from continuing operations grew by 19 percent, before bitumen
revision, to 14.8 trillion cubic feet equivalent. Beyond proved reserves, the
company has estimated its Unbooked Resource Potential to be the quantities of
hydrocarbons that may be added to proved reserves through the low-risk
development of known resources within existing landholdings, that exceed the
company's targeted economic thresholds. EnCana estimates that this Unbooked
Resource Potential could be converted to proved reserves over the next five
years should the company choose to exploit its drilling inventory at a rate
which results in compounded annual production growth exceeding 10 percent.
Should EnCana proceed with a lower growth rate strategy, it is expected that
the Unbooked Resource Potential would be converted to proved reserves over a
longer time frame. As of December 31, 2004, EnCana estimates its Unbooked
Resource Potential is 19 trillion cubic feet of natural gas and 900 million
barrels of oil and NGLs. The estimate of Unbooked Resource Potential is based
on information currently available to EnCana; actual results may differ
materially from these estimates.

EnCana's resource life exceeds a quarter century

EnCana's Total Resource Portfolio is key to EnCana's predictable
long-term development plans. Based on EnCana's 2004 production, the company's
estimated total natural gas resource life is about 27 years. For oil and NGLs,
the company's total oil and NGLs resource life estimate is about 26 years.
EnCana's total resource drilling inventory consists of about 36,000 gas wells
and about 1,000 oil wells at year end 2004.
"EnCana is extremely well positioned to continue to create shareholder
value over the long run as it executes on its huge drilling inventory within
our low-risk manufacturing style development program. Largely contained in
approximately 18 million net undeveloped acres of onshore North American
lands, this total resource life extends for more than a quarter century, based
on 2004 production rates, and we believe has the ability to fuel sustainable,
profitable growth for many years," said Randy Eresman, EnCana's Chief
Operating Officer.

-------------------------------------------------------------------------
EnCana's Total Resource Portfolio
-------------------------------------------------------------------------
Natural Gas Oil & NGLs
(Tcf) (MMbbls) Evaluated By
-------------------------------------------------------------------------
Independent
EnCana proved reserves(*) qualified
(at Dec. 31, 2004) 10.5 (xx)721 reserves evaluators

Unbooked Resource Potential 19.0 900 EnCana engineers
-------------------------------------------------------------------------
Total Resource Portfolio 29.5 1,621
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(*)Continuing operations (excludes Ecuador)
(xx)Before bitumen revision

2005 sales on track

EnCana is on track to meet its 2005 full year sales guidance, from
continuing operations, of between 4.25 billion and 4.50 billion cubic feet of
gas equivalent per day, comprised of between 3.35 billion and 3.50 billion
cubic feet of natural gas per day and between 150,000 and 170,000 barrels of
oil and NGLs per day. The company's sales guidance assumes the divestiture of
approximately 22,000 BOE per day of conventional Canadian production later
this year. The liquids guidance does not include production of between 75,000
and 85,000 barrels of oil per day from Ecuador, which has been treated as
discontinued due to the planned divestiture.

North American natural gas prices rise in the first quarter of 2005

EnCana's North American realized field prices, excluding financial
hedging, averaged $5.81 per thousand cubic feet, up 10 percent in the first
quarter of 2005 from an average of $5.26 per thousand cubic feet in the same
2004 period. Including hedging, EnCana's average first quarter realized gas
price was $5.99 per thousand cubic feet. Natural gas prices are expected to
stay strong due to the tight North American supply and demand balance driven
by continued demand growth primarily from the electricity generation industry
while overall supply has struggled to keep pace. The average first quarter
benchmark NYMEX index gas price was $6.27 per thousand cubic feet, up 10
percent from $5.69 per thousand cubic feet in the first quarter of 2004.

First quarter world oil prices remain strong; Canadian heavy oil price
differentials widen

World oil prices continued to be strong through the first quarter of 2005
due to increasing global demand, primarily in Asia and North America. During
the first quarter of 2005, the average benchmark West Texas Intermediate (WTI)
crude oil price was $50.03 per barrel, up 42 percent from the first quarter
2004 average of $35.25 per barrel. The substantially higher level of WTI,
combined with limited worldwide upgrading capacity for heavy crude oils,
resulted in a significant widening of light/heavy crude oil price
differentials. In the first quarter, the WTI/Bow River differential increased
105 percent to $18.51 per barrel compared to the same 2004 period. In the
first quarter, EnCana's average realized oil and NGLs price, excluding
hedging, was $29.77 per barrel, up 17 percent; including hedging it was $24.59
per barrel, up 19 percent compared to the same period in 2004.

Risk management strategy

EnCana's market risk mitigation strategy is intended to help deliver
greater predictability of cash flow and returns on investment. Detailed risk
management positions at March 31, 2005 are presented in Note 12 to the
unaudited first quarter consolidated financial statements. In the first
quarter of 2005, EnCana's financial commodity risk management measures
resulted in after-tax cash flow from continuing operations being lower by
approximately $10 million, comprised of a $49 million loss on oil hedges,
offset by a $35 million gain on gas hedges and a $4 million gain on other
hedges.

Hedging aimed at providing downside price protection

A review of the company's hedging strategy in 2004 resulted in a
preference towards the use of hedging instruments which provide downside
protection, but do not limit upside in a rising price environment. Currently,
about 79 percent of 2005 forecast gas sales is exposed to price upside, while
about 53 percent has downside price protection. For oil, about 81 percent of
2005 forecast oil sales is exposed to price upside, while about 34 percent has
downside protection. Overall, on a Mcfe basis, about 80 percent of EnCana's
forecast 2005 sales are exposed to market price upside. Beyond 2005, fixed
price hedges are in place for approximately 810 million cubic feet per day of
2006 gas production and 31 million cubic feet per day of 2007 gas production.


EnCana Continuing Operations Highlights
---------------------------------------
US$ and U.S. protocols
----------------------

-------------------------------------------------------------------------
Financial Highlights
(as at and for the period ended March 31) Q1 Q1 %
($ millions, except per share amounts) 2005 2004 Change
-------------------------------------------------------------------------
Revenues, net of royalties 2,661 2,730 - 3

Cash flow 1,308 896 + 46
Per share - basic 2.93 1.94 + 51
Per share - diluted 2.88 1.92 + 50

Add back:
---------
Total cash tax 225 225 -

Pre-tax cash flow 1,533 1,121 + 37

Net capital investment 1,466 958 + 53

Net (loss) earnings (125) 326 - 138
Per share - basic (0.28) 0.71 - 139
Per share - diluted (0.28) 0.70 - 140

Add (Deduct):
Unrealized mark-to-market accounting loss,
after-tax 628 213 + 195

Unrealized foreign exchange loss on
translation of U.S. dollar debt issued
in Canada, after-tax 15 32 - 53

Future tax (recovery) due to tax rate change - (109) n/a

Operating earnings 518 462 + 12
Per share - diluted 1.14 0.99 + 15
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Common shares (millions)
Weighted average (basic) 445.9 460.9 - 3
Weighted average (diluted) 454.5 467.1 - 3
-------------------------------------------------------------------------
-------------------------------------------------------------------------

EnCana financial results in U.S. dollars and operating results according
to U.S. protocols

EnCana reports in U.S. dollars and according to U.S. protocols in order
to facilitate a more direct comparison to other North American upstream oil
and natural gas exploration and development companies. Reserves and production
are reported on an after-royalty basis.

-------------------------------------------------------------------------
Operating Highlights
(for the period ended March 31) Q1 Q1 %
(After royalties) 2005 2004 Change
-------------------------------------------------------------------------
North America Natural Gas (MMcf/d)
Production 3,119 2,684 + 16
Inventory withdrawal 27 - n/a
-------------------------------------------------------------------------
Natural gas sales (MMcf/d) 3,146 2,684 + 17
-------------------------------------------------------------------------
North America Oil and NGLs (bbls/d) 157,184 165,877 - 5
-------------------------------------------------------------------------
Total sales (MMcfe/d) 4,089 3,679 + 11
-------------------------------------------------------------------------
Per share sales (Mcfe per 1,000 shares) 825 726 + 14
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Key resource play growth up 23 percent across EnCana's portfolio

In North America, development capital continues to be focused on turning
EnCana's Unbooked Resource Potential into production and reserves. First
quarter oil and gas production from key North American resource plays has
increased more than 23 percent since the first quarter of 2004. This is driven
mainly by increases in gas production in the Piceance basin in Colorado,
shallow gas and coalbed methane (CBM) on the company's legacy Suffield and
Palliser Blocks, Cutbank Ridge in northeast British Columbia, the acquisition
of East Texas lands and growth from the Fort Worth resource play, plus
increases in oil production at Pelican Lake in northeast Alberta.


Growth from key North American resource plays

-------------------------------------------------------------------------
Daily Production
-------------------------------------------------------------------------
2005 2004 2003
------------------------------------------------
Resource Play Full Full
(After royalties) Q1 Year Q4 Q3 Q2 Q1 Year
-------------------------------------------------------------------------
Natural Gas (MMcf/d)
Jonah 431 389 404 373 387 394 374
Piceance 300 261 291 282 251 218 151
East Texas 82 50 83 81 36 - -
Fort Worth 61 27 34 31 23 21 7
Greater Sierra 195 230 211 244 247 216 143
Cutbank Ridge 56 40 50 45 41 22 3
CBM 33 17 27 19 11 10 4
Shallow Gas 625 592 629 595 590 554 507
-------------------------------------------------------------------------
Oil (Mbbls/d)
Foster Creek 30 29 28 29 30 28 22
Pelican Lake 21 19 23 22 15 15 16
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total (MMcfe/d) 2,091 1,892 2,034 1,976 1,858 1,696 1,416
-------------------------------------------------------------------------
% change from Q1 2004 23.3
-------------------------------------------------------------------------
% change from prior
period 2.8 33.6 2.9 6.4 9.6 7.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Drilling activity in key North American resource plays

-------------------------------------------------------------------------
Net Wells Drilled
------------------------------------------------
2005 2004 2003
----------------------------------
Full Full
Resource Play Q1 year Q4 Q3 Q2 Q1 Year
-------------------------------------------------------------------------
Natural Gas
Jonah 28 70 21 17 21 11 59
Piceance 77 250 47 66 66 71 284
East Texas 21 50 23 20 7 - -
Fort Worth 9 36 8 10 10 8 5
Greater Sierra 59 187 18 13 21 135 199
Cutbank Ridge 23 50 17 12 4 17 20
CBM 164 577 126 272 98 81 267
Shallow Gas 273 1,552 222 384 416 530 2,366
-------------------------------------------------------------------------
Oil
Foster Creek 17 11 7 - - 4 8
Pelican Lake 19 92 - 33 30 29 134
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total net wells 690 2,875 489 827 673 886 3,342
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Corporate developments
----------------------

Shareholders to vote today on two-for-one share split

At the Annual and Special meeting of EnCana's shareholders later today,
EnCana's shareholders are being asked to approve the split of EnCana's
outstanding common shares on a two-for-one basis. In addition to shareholder
approval, the stock split is subject to the receipt of all required regulatory
approvals.
If approved by shareholders, and subject to regulatory approvals, each
shareholder will receive one additional common share for each common share
held on the record date for the stock split of May 12, 2005. Pursuant to the
rules of the Toronto Stock Exchange, EnCana's common shares will commence
trading on a subdivided basis at the opening of business on May 10, 2005,
which is the second trading day preceding the record date. Also on May 10,
2005, EnCana's common shares listed on the New York Stock Exchange (NYSE) will
commence trading with rights entitling holders to an additional common share
for each common share held upon the commencement of trading of the common
shares on a subdivided basis on the NYSE. The trading of the common shares on
a subdivided basis on the NYSE will occur one day after the delivery of share
certificates to registered holders of EnCana's common shares. It is
anticipated that share certificates representing the additional common shares
resulting from the stock split will be mailed to registered common
shareholders on or about May 20, 2005.

Quarterly dividend increased 50 percent to 15 cents per share

EnCana's board of directors has increased the company's quarterly
dividend 50 percent to 15 cents per share, on a pre-split basis, which is
payable on June 30, 2005 to common shareholders of record as of June 15, 2005.

Normal Course Issuer Bid purchases

To date in 2005, EnCana has purchased for cancellation approximately 11
million of its shares at an average price of $61.65 per share under its
current Normal Course Issuer Bid, which allows the company to purchase up to
10 percent of the company's public float at the time of the approval of the
original bid - October, 2004. The company had 440.8 million shares outstanding
at March 31, 2005. EnCana's 2005 capital program is expected to be funded by
cash flow, while the company's planned divestitures of conventional assets in
2005 are expected to bring in substantial funds which EnCana believes will
provide the opportunity to increase net asset value per share through share
purchases and debt repayment.

Financial strength
------------------

EnCana maintains a strong balance sheet. At March 31, 2005 the company's
net debt-to-capitalization ratio was 39:61. EnCana's net debt-to-EBITDA
multiple, on a trailing 12-month basis, was 1.8 times. These ratios are
expected to decrease through the year due to cash inflows from operations and
asset sales.
In the first quarter of 2005, EnCana invested $1,519 million of capital
in continuing operations. Net divestitures were $53 million, resulting in net
capital investment in continuing operations of $1,466 million.

-------------------------------------------------------------------------
CONFERENCE CALL TODAY
7:15 a.m. Mountain Time (9:15 a.m. Eastern Time)

EnCana Corporation will host a conference call today, Wednesday,
April 27, 2005 starting at 7:15 a.m., Mountain Time (9:15 a.m. Eastern
Time), to discuss EnCana's first quarter 2005 financial and operating
results.

To participate, please dial (913) 312-1295 approximately 10 minutes prior
to the conference call. An archived recording of the call will be
available from approximately 5 p.m. on April 27, 2005 until midnight
May 3, 2005 by dialling (888) 203-1112 or (719) 457-0820 and entering
pass code 9649948.

A live audio Web cast of the conference call will also be available via
EnCana's Web site, www.encana.com, under Investor Relations. The Web cast
will be archived for approximately 90 days.
-------------------------------------------------------------------------

EnCana Corporation

With an enterprise value of approximately US$38 billion, EnCana is one of
North America's leading natural gas producers, is among the largest holders of
gas and oil resource lands onshore North America and is a technical and cost
leader in the in-situ recovery of oilsands bitumen. EnCana delivers
predictable, reliable, profitable growth from its portfolio of long-life
resource plays situated in Canada and the United States. Contained in
unconventional reservoirs, resource plays are large contiguous accumulations
of hydrocarbons, located in thick or areally extensive deposits, that
typically have low geological and commercial development risk, low average
decline rates and very long producing lives. The application of technology to
unlock the huge resource potential of these plays typically results in
continuous increases in production and reserves and decreases in costs over
multiple decades of resource play life. EnCana common shares trade on the
Toronto and New York stock exchanges under the symbol ECA.

NOTE 1: Non-GAAP measures

This news release contains references to cash flow, pre-tax cash flow,
cash flow from continuing operations, operating earnings from continuing
operations and total operating earnings. Total operating earnings is a
non-GAAP measure that shows net earnings excluding non-operating items such as
the after-tax impacts of a gain on the sale of discontinued operations, the
after-tax gain/loss of unrealized mark-to-market accounting for derivative
instruments, the after-tax gain/loss on translation of U.S. dollar denominated
debt issued in Canada and the effect of the reduction in income tax rates.
Management believes these items reduce the comparability of the company's
underlying financial performance between periods. The majority of the
unrealized gains/losses that relate to U.S. dollar debt issued in Canada are
for debt with maturity dates in excess of five years. These measures have been
described and presented in this news release in order to provide shareholders
and potential investors with additional information regarding EnCana's
liquidity and its ability to generate funds to finance its operations.

ADVISORY REGARDING RESERVES DATA AND OTHER OIL AND GAS INFORMATION -
EnCana's disclosure of reserves data and other oil and gas information is made
in reliance on an exemption granted to EnCana by Canadian securities
regulatory authorities which permits it to provide such disclosure in
accordance with U.S. disclosure requirements. The information provided by
EnCana may differ from the corresponding information prepared in accordance
with Canadian disclosure standards under National Instrument 51-101
(NI 51-101). EnCana's reserves quantities represent net proved reserves
calculated using the standards contained in Regulation S-X of the U.S.
Securities and Exchange Commission. Further information about the differences
between the U.S. requirements and the NI 51-101 requirements is set forth
under the heading "Note Regarding Reserves Data and Other Oil and Gas
Information" in EnCana's Annual Information Form.
In this news release, certain crude oil and NGLs volumes have been
converted to cubic feet equivalent (cfe) on the basis of one barrel (bbl) to
six thousand cubic feet (Mcf). Also, certain natural gas volumes have been
converted to barrels of oil equivalent (BOE) on the same basis. BOE and cfe
may be misleading, particularly if used in isolation. A conversion ratio of
one bbl to six Mcf is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not necessarily represent
value equivalency at the well head.

ADVISORY REGARDING FORWARD-LOOKING STATEMENTS - In the interests of
providing EnCana shareholders and potential investors with information
regarding EnCana, including management's assessment of EnCana's and its
subsidiaries' future plans and operations, certain statements contained in
this news release are forward-looking statements within the meaning of the
"safe harbour" provisions of the United States Private Securities Litigation
Reform Act of 1995. Forward-looking statements in this news release include,
but are not limited to: future economic and operating performance (including
per share growth and increase in net asset value); anticipated life of proved
reserves; anticipated Unbooked Resource Potential; anticipated conversion of
Unbooked Resource Potential to proved reserves; estimates of the company's
Total Resource Portfolio; anticipated growth and success of resource plays and
the expected characteristics of resource plays; anticipated total resource
life, including total natural gas resource life and total oil and NGLs
resource life; planned divestitures of conventional Canadian properties, the
potential structure of such transactions and the potential monetization of
such assets; planned sale of interests in the Gulf of Mexico and Ecuador and
the timing of such potential transactions; the expected proceeds from planned
divestitures; expected proportion of total production and cash flows
contributed by natural gas; anticipated success of EnCana's market risk
mitigation strategy and EnCana's ability to participate in commodity price
upside; the anticipated steps to implement the proposed two-for-one share
split and the impact of such a split; anticipated purchases pursuant to the
Normal Course Issuer Bid; estimated reserve life indices; potential demand for
gas; anticipated production in 2005 and beyond; anticipated drilling;
potential capital expenditures and investment; potential oil, natural gas and
NGLs sales in 2005 and beyond; anticipated ability to meet production,
operating cost and sales guidance targets; anticipated costs; anticipated
prices for natural gas; potential sale of the company's NGLs business and the
timing of such a transaction; potential risks associated with drilling and
references to potential exploration. Readers are cautioned not to place undue
reliance on forward-looking statements, as there can be no assurance that the
plans, intentions or expectations upon which they are based will occur. By
their nature, forward-looking statements involve numerous assumptions, known
and unknown risks and uncertainties, both general and specific, that
contribute to the possibility that the predictions, forecasts, projections and
other forward-looking statements will not occur, which may cause the company's
actual performance and financial results in future periods to differ
materially from any estimates or projections of future performance or results
expressed or implied by such forward-looking statements. These risks and
uncertainties include, among other things: volatility of oil and gas prices;
fluctuations in currency and interest rates; product supply and demand; market
competition; risks inherent in the company's marketing operations, including
credit risks; imprecision of reserves estimates and estimates of recoverable
quantities of oil, natural gas and liquids from resource plays and other
sources not currently classified as proved reserves; the company's ability to
replace and expand oil and gas reserves; its ability to generate sufficient
cash flow from operations to meet its current and future obligations; its
ability to access external sources of debt and equity capital; the timing and
the costs of well and pipeline construction; the company's ability to secure
adequate product transportation; changes in environmental and other
regulations or the interpretations of such regulations; political and economic
conditions in the countries in which the company operates, including Ecuador;
the risk of war, hostilities, civil insurrection and instability affecting
countries in which the company operates and terrorist threats; risks
associated with existing and potential future lawsuits and regulatory actions
made against the company; and other risks and uncertainties described from
time to time in the reports and filings made with securities regulatory
authorities by EnCana. Although EnCana believes that the expectations
represented by such forward-looking statements are reasonable, there can be no
assurance that such expectations will prove to be correct. Readers are
cautioned that the foregoing list of important factors is not exhaustive.
Furthermore, the forward-looking statements contained in this news
release are made as of the date of this news release, and EnCana does not
undertake any obligation to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information, future
events or otherwise. The forward-looking statements contained in this news
release are expressly qualified by this cautionary statement.



Interim Consolidated Financial Statements
(unaudited)
For the period ended March 31, 2005

EnCana Corporation

U.S. DOLLARS



Interim Report
For the period ended March 31, 2005

<<

EnCana Corporation
CONSOLIDATED STATEMENT OF EARNINGS (unaudited)

Three Months Ended
March 31,
-----------------------
($ millions, except per share amounts) 2005 2004
-------------------------------------------------------------------------

REVENUES, NET OF ROYALTIES
Upstream (Note 2) $ 2,106 $ 1,629
Midstream & Market Optimization (Note 2) 1,527 1,419
Corporate (Note 2) (972) (318)
-------------------------------------------------------------------------
2,661 2,730

EXPENSES (Note 2)
Production and mineral taxes 87 54
Transportation and selling 136 135
Operating 372 317
Purchased product 1,363 1,287
Depreciation, depletion and
amortization 686 526
Administrative 61 49
Interest, net 100 79
Accretion of asset retirement
obligation (Note 8) 9 6
Foreign exchange loss (Note 5) 31 59
Stock-based compensation 4 5
Gain on dispositions (Note 4) - (34)
-------------------------------------------------------------------------
2,849 2,483
-------------------------------------------------------------------------
NET (LOSS) EARNINGS BEFORE INCOME TAX (188) 247
Income tax recovery (Note 6) (63) (79)
-------------------------------------------------------------------------
NET (LOSS) EARNINGS FROM CONTINUING
OPERATIONS (125) 326
NET EARNINGS (LOSS) FROM DISCONTINUED
OPERATIONS (Note 3) 80 (36)
-------------------------------------------------------------------------
NET (LOSS) EARNINGS $ (45) $ 290
-------------------------------------------------------------------------
-------------------------------------------------------------------------

NET (LOSS) EARNINGS FROM CONTINUING
OPERATIONS PER COMMON SHARE (Note 11)
Basic $ (0.28) $ 0.71
Diluted $ (0.28) $ 0.70
-------------------------------------------------------------------------
-------------------------------------------------------------------------

NET (LOSS) EARNINGS PER COMMON SHARE (Note 11)
Basic $ (0.10) $ 0.63
Diluted $ (0.10) $ 0.62
-------------------------------------------------------------------------
-------------------------------------------------------------------------



CONSOLIDATED STATEMENT OF RETAINED EARNINGS (unaudited)

Three Months Ended
March 31,
-----------------------
($ millions) 2005 2004
-------------------------------------------------------------------------

RETAINED EARNINGS, BEGINNING OF YEAR $ 7,935 $ 5,276
Net (Loss) Earnings (45) 290
Dividends on Common Shares (44) (46)
Charges for Normal Course Issuer Bid (Note 9) (490) (120)
Charges for Shares Repurchased and Held (Note 9) (70) -
-------------------------------------------------------------------------
RETAINED EARNINGS, END OF PERIOD $ 7,286 $ 5,400
-------------------------------------------------------------------------
-------------------------------------------------------------------------

See accompanying Notes to Consolidated Financial Statements.



CONSOLIDATED BALANCE SHEET (unaudited)

As at As at
March 31, December 31,
($ millions) 2005 2004
-------------------------------------------------------------------------

ASSETS
Current Assets
Cash and cash equivalents $ 441 $ 602
Accounts receivable and accrued
revenues 1,556 1,898
Risk management (Note 12) 159 336
Inventories 209 513
Assets of discontinued operations (Note 3) 201 156
-------------------------------------------------------------------------
2,566 3,505
Property, Plant and Equipment, net (Note 2) 23,870 23,140
Investments and Other Assets 372 334
Risk Management (Note 12) 72 87
Assets of Discontinued Operations (Note 3) 1,675 1,623
Goodwill 2,515 2,524
-------------------------------------------------------------------------
(Note 2) $ 31,070 $ 31,213
-------------------------------------------------------------------------
-------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued
liabilities $ 1,953 $ 1,879
Income tax payable 384 359
Risk management (Note 12) 826 241
Liabilities of discontinued
operations (Note 3) 311 280
Current portion of long-term debt (Note 7) 187 188
-------------------------------------------------------------------------
3,661 2,947
Long-Term Debt (Note 7) 7,695 7,742
Other Liabilities 90 118
Risk Management (Note 12) 401 192
Asset Retirement Obligation (Note 8) 639 611
Liabilities of Discontinued
Operations (Note 3) 121 102
Future Income Taxes 4,886 5,193
-------------------------------------------------------------------------
17,493 16,905
-------------------------------------------------------------------------
Shareholders' Equity
Share capital (Note 9) 5,210 5,299
Share options, net - 10
Paid in surplus 60 28
Retained earnings 7,286 7,935
Foreign currency translation
adjustment 1,021 1,036
-------------------------------------------------------------------------
13,577 14,308
-------------------------------------------------------------------------
$ 31,070 $ 31,213
-------------------------------------------------------------------------
-------------------------------------------------------------------------

See accompanying Notes to Consolidated Financial Statements.



CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)

Three Months Ended
March 31,
-----------------------
($ millions) 2005 2004
-------------------------------------------------------------------------

OPERATING ACTIVITIES
Net (loss) earnings from continuing
operations $ (125) $ 326
Depreciation, depletion and
amortization 686 526
Future income taxes (Note 6) (288) (304)
Unrealized loss on risk management (Note 12) 969 317
Unrealized foreign exchange loss (Note 5) 18 39
Accretion of asset retirement
obligation (Note 8) 9 6
Gain on dispositions (Note 4) - (34)
Other 39 20
-------------------------------------------------------------------------
Cash flow from continuing operations 1,308 896
Cash flow from discontinued operations 105 99
-------------------------------------------------------------------------
Cash flow 1,413 995
Net change in other assets and
liabilities 2 (5)
Net change in non-cash working capital
from continuing operations 566 239
Net change in non-cash working capital
from discontinued operations (55) 153
-------------------------------------------------------------------------
1,926 1,382
-------------------------------------------------------------------------

INVESTING ACTIVITIES
Capital expenditures (Note 2) (1,519) (1,271)
Proceeds on disposal of assets (Note 2) 53 25
Dispositions (Note 4) - 288
Equity investments - 40
Net change in investments and other 19 11
Net change in non-cash working capital
from continuing operations 155 61
Discontinued operations (57) (252)
-------------------------------------------------------------------------
(1,349) (1,098)
-------------------------------------------------------------------------

FINANCING ACTIVITIES
Net repayment of revolving long-term debt (33) (8)
Repayment of long-term debt (1) (95)
Issuance of common shares (Note 9) 101 111
Purchase of common shares (Note 9) (760) (218)
Dividends on common shares (44) (46)
Other (2) (1)
-------------------------------------------------------------------------
(739) (257)
-------------------------------------------------------------------------

DEDUCT: FOREIGN EXCHANGE GAIN ON CASH AND
CASH EQUIVALENTS HELD IN FOREIGN CURRENCY (1) -
-------------------------------------------------------------------------

(DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS (161) 27
CASH AND CASH EQUIVALENTS, BEGINNING
OF YEAR 602 113
-------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 441 $ 140
-------------------------------------------------------------------------
-------------------------------------------------------------------------

See accompanying Notes to Consolidated Financial Statements.



Notes to Consolidated Financial Statements (unaudited)
(All amounts in $ millions unless otherwise specified)

1. BASIS OF PRESENTATION

The interim Consolidated Financial Statements include the accounts of
EnCana Corporation and its subsidiaries ("EnCana" or the "Company"), and
are presented in accordance with Canadian generally accepted accounting
principles. The Company is in the business of exploration for, and
production and marketing of, natural gas, crude oil and natural gas
liquids, as well as natural gas storage, natural gas liquids processing
and power generation operations.

The interim Consolidated Financial Statements have been prepared
following the same accounting policies and methods of computation as the
annual audited Consolidated Financial Statements for the year ended
December 31, 2004. The disclosures provided below are incremental to
those included with the annual audited Consolidated Financial Statements.
The interim Consolidated Financial Statements should be read in
conjunction with the annual audited Consolidated Financial Statements and
the notes thereto for the year ended December 31, 2004.

2. SEGMENTED INFORMATION

The Company has defined its continuing operations into the following
segments:

- Upstream includes the Company's exploration for, and development and
production of, natural gas, crude oil and natural gas liquids and
other related activities. The majority of the Company's Upstream
operations are located in Canada and the United States. International
new venture exploration is mainly focused on opportunities in Africa,
South America, the Middle East and Greenland.

- Midstream & Market Optimization is conducted by the Midstream &
Marketing division. Midstream includes natural gas storage, natural
gas liquids processing and power generation. The Marketing groups'
primary responsibility is the sale of the Company's proprietary
production. The results are included in the Upstream segment.
Correspondingly, the Marketing groups also undertake market
optimization activities which comprise third party purchases and
sales of product that provide operational flexibility for
transportation commitments, product type, delivery points and
customer diversification. These activities are reflected in the
Midstream & Market Optimization segment.

- Corporate includes unrealized gains or losses recorded on derivative
instruments. Once amounts are settled, the realized gains and losses
are recorded in the operating segment to which the derivative
instrument relates.

Midstream & Market Optimization purchases substantially all of the
Company's North American Upstream production. Transactions between
business segments are based on market values and eliminated on
consolidation. The tables in this note present financial information on
an after eliminations basis.

Operations that have been discontinued are disclosed in Note 3.

Results of Continuing Operations (For the three months ended March 31)

Midstream
& Market
Upstream Optimization
---------------------------------------
2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalties $ 2,106 $ 1,629 $ 1,527 $ 1,419
Expenses
Production and mineral taxes 87 54 - -
Transportation and selling 131 127 5 8
Operating 292 241 83 78
Purchased product - - 1,363 1,287
Depreciation, depletion and
amortization 660 503 9 7
-------------------------------------------------------------------------
Segment Income $ 936 $ 704 $ 67 $ 39
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Corporate(*) Consolidated
---------------------------------------
2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalties $ (972) $ (318) $ 2,661 $ 2,730
Expenses
Production and mineral taxes - - 87 54
Transportation and selling - - 136 135
Operating (3) (2) 372 317
Purchased product - - 1,363 1,287
Depreciation, depletion and
amortization 17 16 686 526
-------------------------------------------------------------------------
Segment Income $ (986) $ (332) 17 411
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Administrative 61 49
Interest, net 100 79
Accretion of asset retirement
obligation 9 6
Foreign exchange loss 31 59
Stock-based compensation 4 5
Gain on dispositions - (34)
-------------------------------------------------------------------------
205 164
-------------------------------------------------------------------------
Net (Loss) Earnings Before Income
Tax (188) 247
Income tax recovery (63) (79)
-------------------------------------------------------------------------
Net (Loss) Earnings From Continuing
Operations $ (125) $ 326
-------------------------------------------------------------------------
-------------------------------------------------------------------------

(*) For the three months ended March 31, the unrealized loss on risk
management is recorded in the Consolidated Statement of Earnings as
follows (see also Note 12):

2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalites - Corporate $ (972) $ (320)
Operating Expenses and Other - Corporate (3) (3)
-------------------------------------------------------------------------
Total Loss on Risk Management - Continuing Operations $ (969) $ (317)
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Results of Continuing Operations (For the three months ended March 31)

Upstream Canada United States
---------------------------------------
2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalties $ 1,426 $ 1,221 $ 619 $ 358
Expenses
Production and mineral taxes 22 20 65 34
Transportation and selling 87 102 44 25
Operating 192 174 44 20
Depreciation, depletion and
amortization 462 416 188 82
-------------------------------------------------------------------------
Segment Income $ 663 $ 509 $ 278 $ 197
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Other Total Upstream
---------------------------------------
2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalties $ 61 $ 50 $ 2,106 $ 1,629
Expenses
Production and mineral taxes - - 87 54
Transportation and selling - - 131 127
Operating 56 47 292 241
Depreciation, depletion and
amortization 10 5 660 503
-------------------------------------------------------------------------
Segment Income $ (5) $ (2) $ 936 $ 704
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Total Midstream
Midstream & Market Market & Market
Optimization Midstream Optimization Optimization
-------------------------------------------------------------------------
2005 2004 2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues $ 566 $ 551 $ 961 $ 868 $ 1,527 $ 1,419
Expenses
Transportation
and selling - - 5 8 5 8
Operating 73 71 10 7 83 78
Purchased product 428 449 935 838 1,363 1,287
Depreciation,
depletion and
amortization 9 7 - - 9 7
-------------------------------------------------------------------------
Segment Income $ 56 $ 24 $ 11 $ 15 $ 67 $ 39
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Upstream Geographic and Product Information (Continuing Operations)
(For the three months ended March 31)

Produced Gas Produced Gas
-----------------------------------------------------
Canada United States Total
-------------------------------------------------------------------------
2005 2004 2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of
Royalties $ 1,133 $ 936 $ 564 $ 330 $ 1,697 $ 1,266
Expenses
Production and
mineral taxes 16 15 59 31 75 46
Transportation
and selling 70 81 44 25 114 106
Operating 121 101 44 20 165 121
-------------------------------------------------------------------------
Operating Cash Flow $ 926 $ 739 $ 417 $ 254 $ 1,343 $ 993
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Oil & NGLs Oil & NGLs
-----------------------------------------------------
Canada United States Total
-------------------------------------------------------------------------
2005 2004 2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of
Royalties $ 293 $ 285 $ 55 $ 28 $ 348 $ 313
Expenses
Production and
mineral taxes 6 5 6 3 12 8
Transportation
and selling 17 21 - - 17 21
Operating 71 73 - - 71 73
-------------------------------------------------------------------------
Operating Cash Flow $ 199 $ 186 $ 49 $ 25 $ 248 $ 211
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Other & Total Upstream Other Total Upstream
----------------------------------
2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of Royalties $ 61 $ 50 $ 2,106 $ 1,629
Expenses
Production and mineral taxes - - 87 54
Transportation and selling - - 131 127
Operating 56 47 292 241
-------------------------------------------------------------------------
Operating Cash Flow $ 5 $ 3 $ 1,596 $ 1,207
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Capital Expenditures (Continuing Operations)
Three Months Ended
March 31,
----------------------
2005 2004
-------------------------------------------------------------------------

Upstream
Canada $ 1,044 $ 1,028
United States 412 210
Other Countries 13 15
-------------------------------------------------------------------------
1,469 1,253
Midstream & Market Optimization 44 9
Corporate 6 9
-------------------------------------------------------------------------
Total $ 1,519 $ 1,271
-------------------------------------------------------------------------
-------------------------------------------------------------------------

In addition to the capital expenditures, during 2005, EnCana divested of
mature conventional oil and natural gas assets and other property, plant
and equipment for proceeds of $53 million (2004 - $25 million).


Property, Plant and Equipment and Total Assets

Property, Plant
and Equipment Total Assets
---------------------------------------
As at As at
---------------------------------------
March 31, December March 31, December
2005 31, 2004 2005 31, 2004
-------------------------------------------------------------------------

Upstream $ 22,806 $ 22,097 $ 26,653 $ 26,118
Midstream & Market
Optimization 833 804 1,509 1,904
Corporate 231 239 1,032 1,412
Assets of Discontinued
Operations (Note 3) 1,876 1,779
-------------------------------------------------------------------------
Total $ 23,870 $ 23,140 $ 31,070 $ 31,213
-------------------------------------------------------------------------
-------------------------------------------------------------------------


3. DISCONTINUED OPERATIONS

At December 31, 2004, EnCana decided to divest of its Ecuador operations
and such operations have been accounted for as discontinued operations.
EnCana's Ecuador operations include the 100 percent working interest in
the Tarapoa Block, majority operating interest in Blocks 14, 17 and
Shiripuno, the non-operated economic interest in Block 15 and the
36.3 percent indirect equity investment in Oleoducto de Crudos Pesados
(OCP) Ltd. ("OCP"), which is the owner of a crude oil pipeline in Ecuador
that ships crude oil from the producing areas of Ecuador to an export
marine terminal. The Company is a shipper on the OCP Pipeline and pays
commercial rates for tariffs. The majority of the Company's crude oil
produced in Ecuador is sold to a single marketing company. Payments are
secured by letters of credit from a major financial institution which has
a high quality investment grade credit rating.

On December 1, 2004, the Company completed the sale of its 100 percent
interest in EnCana (U.K.) Limited for net cash consideration of
approximately $2.1 billion. EnCana's U.K. operations included crude oil
and natural gas interests in the U.K. central North Sea including the
Buzzard, Scott and Telford oil fields, as well as other satellite
discoveries and exploration licenses. A gain on sale of approximately
$1.4 billion was recorded. Accordingly, these operations have been
accounted for as discontinued operations.

Consolidated Statement of Earnings

The following table presents the effect of the discontinued operations in
the Consolidated Statement of Earnings:

For the three months ended March 31
-----------------------------------------------------
Ecuador United Kingdom Total
-----------------------------------------------------
2005 2004 2005 2004 2005 2004
-------------------------------------------------------------------------

Revenues, Net of
Royalties(*) $ 191 $ 79 $ - $ 41 $ 191 $ 120
-------------------------------------------------------------------------

Expenses
Production and
mineral taxes 22 11 - - 22 11
Transportation
and selling 15 19 - 8 15 27
Operating 28 30 - 6 28 36
Depreciation,
depletion and
amortization - 65 - 33 - 98
Accretion of
asset retirement
obligation - - - 1 - 1
Foreign exchange
gain - - - (1) - (1)
-------------------------------------------------------------------------
65 125 - 47 65 172
-------------------------------------------------------------------------
Net Earnings (Loss)
Before Income Tax 126 (46) - (6) 126 (52)
Income tax expense
(recovery) 46 (15) - (1) 46 (16)
-------------------------------------------------------------------------
Net Earnings (Loss)
From Discontinued
Operations $ 80 $ (31) $ - $ (5) $ 80 $ (36)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

(*) Revenues, net of royalties in Ecuador include $23 million of realized
losses (2004 - $49 million) and $20 million of unrealized losses (2004 -
$47 million) related to derivative financial instruments.


Consolidated Balance Sheet

The impact of the discontinued operations in the Consolidated Balance
Sheet is as follows:

As at
--------------------------------------------------------
March 31, 2005 December 31, 2004
--------------------------------------------------------
United United
Ecuador Kingdom Total Ecuador Kingdom Syncrude Total
--------------------------------------------------------
Assets
Cash and cash
equivalents $ 1 $ 12 $ 13 $ 2 $ 12 $ - $ 14
Accounts
receivable
and accrued
revenues 156 12 168 111 13 - 124
Risk management - - - 3 - - 3
Inventories 20 - 20 15 - - 15
-------------------------------------------------------------------------
177 24 201 131 25 - 156
Property, plant
and equipment,
net 1,341 - 1,341 1,295 - - 1,295
Investments and
other assets 334 - 334 328 - - 328
-------------------------------------------------------------------------
$ 1,852 $ 24 $ 1,876 $ 1,754 $ 25 $ - $ 1,779
-------------------------------------------------------------------------
Liabilities
Accounts
payable and
accrued
liabilities $ 84 $ 30 $ 114 $ 61 $ 32 $ 3 $ 96
Income tax
payable 105 1 106 101 - - 101
Risk management 92 - 92 72 - - 72
-------------------------------------------------------------------------
281 31 312 234 32 3 269
Asset retirement
obligation 22 - 22 22 - - 22
Future income
taxes 99 (1) 98 80 11 - 91
-------------------------------------------------------------------------
402 30 432 336 43 3 382
-------------------------------------------------------------------------
Net Assets of
Discontinued
Operations $ 1,450 $ (6)$ 1,444 $ 1,418 $ (18)$ (3)$ 1,397
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Contingencies

In Ecuador, a subsidiary of EnCana has a 40 percent non-operated economic
interest in relation to Block 15 pursuant to a contract with a subsidiary
of Occidental Petroleum Corporation. In its 2004 filings with Securities
regulatory authorities, Occidental Petroleum Corporation indicated that
its subsidiary had received formal notification from Petroecuador, the
state oil company of Ecuador, initiating proceedings to determine if the
subsidiary had violated the Hydrocarbons Law and its Participation
Contract for Block 15 with Petroecuador and whether such violations
constitute grounds for terminating the Participation Contract.

In its filings, Occidental Petroleum Corporation indicated that it
believes it has complied with all material obligations under the
Participation Contract and that any termination of the Participation
Contract by Ecuador based upon these stated allegations would be
unfounded and would constitute an unlawful expropriation under
international treaties.

In addition to the above, the Company is proceeding with its arbitration
related to value-added tax ("VAT") owed to the Company and is in
discussions related to certain income tax matters related to interest
deductibility in Ecuador.


4. DISPOSITIONS

In March 2004, the Company sold its equity investment in a well servicing
company for approximately $44 million, recording a pre-tax gain on sale
of $34 million.

On February 18, 2004, the Company sold its 53.3 percent interest in
Petrovera Resources ("Petrovera") for approximately $288 million,
including working capital adjustments. In order to facilitate the
transaction, the Company purchased the 46.7 percent interest of its
partner for approximately $253 million, including working capital
adjustments, and then sold the 100 percent interest in Petrovera for a
total of approximately $541 million, including working capital
adjustments. In accordance with full cost accounting for oil and gas
activities, proceeds were credited to property, plant and equipment.


5. FOREIGN EXCHANGE LOSS
Three Months Ended
March 31,
-----------------------
2005 2004
-------------------------------------------------------------------------

Unrealized Foreign Exchange Loss on Translation
of U.S. Dollar Debt Issued in Canada $ 18 $ 39
Realized Foreign Exchange Losses 13 20
-------------------------------------------------------------------------
$ 31 $ 59
-------------------------------------------------------------------------
-------------------------------------------------------------------------


6. INCOME TAXES

The provision for income taxes is as follows:

Three Months Ended
March 31,
-----------------------
2005 2004
-------------------------------------------------------------------------

Current
Canada $ 186 $ 222
United States 32 8
Other 7 (5)
-------------------------------------------------------------------------
Total Current Tax 225 225
Future (288) (195)
Future Tax Rate Reductions - (109)
-------------------------------------------------------------------------
Total Future Tax (288) (304)
-------------------------------------------------------------------------
$ (63) $ (79)
-------------------------------------------------------------------------
-------------------------------------------------------------------------


The following table reconciles income taxes calculated at the Canadian
statutory rate with the actual income taxes:

Three Months Ended
March 31,
-----------------------
2005 2004
-------------------------------------------------------------------------

Net Earnings Before Income Tax $ (188) $ 247
Canadian Statutory Rate 37.9% 39.1%
-------------------------------------------------------------------------
Expected Income Tax (71) 97

Effect on Taxes Resulting from:
Non-deductible Canadian crown payments 42 52
Canadian resource allowance (48) (60)
Canadian resource allowance on unrealized
risk management losses 18 17
Statutory and other rate differences (15) (13)
Effect of tax rate changes - (109)
Non-taxable capital gains 5 7
Previously unrecognized capital losses - 13
Tax basis retained on dispositions - (80)
Large corporations tax 4 4
Other 2 (7)
-------------------------------------------------------------------------
$ (63) $ (79)
-------------------------------------------------------------------------
Effective Tax Rate 33.5% (32.0%)
-------------------------------------------------------------------------
-------------------------------------------------------------------------


7. LONG-TERM DEBT
As at As at
March 31, December 31,
2005 2004
-------------------------------------------------------------------------

Canadian Dollar Denominated Debt
Revolving credit and term loan borrowings $ 1,548 $ 1,515
Unsecured notes and debentures 1,302 1,309
-------------------------------------------------------------------------
2,850 2,824
-------------------------------------------------------------------------

U.S. Dollar Denominated Debt
Revolving credit and term loan borrowings 326 399
Unsecured notes and debentures 4,640 4,641
-------------------------------------------------------------------------
4,966 5,040
-------------------------------------------------------------------------

Increase in Value of Debt Acquired(*) 66 66
Current Portion of Long-Term Debt (187) (188)
-------------------------------------------------------------------------
$ 7,695 $ 7,742
-------------------------------------------------------------------------
-------------------------------------------------------------------------

(*) Certain of the notes and debentures of EnCana were acquired in
business combinations and were accounted for at their fair value at the
dates of acquisition. The difference between the fair value and the
principal amount of the debt is being amortized over the remaining life
of the outstanding debt acquired, approximately 22 years.


8. ASSET RETIREMENT OBLIGATION

The following table presents the reconciliation of the beginning and
ending aggregate carrying amount of the obligation associated with the
retirement of oil and gas properties:

As at As at
March 31, December 31,
2005 2004
-------------------------------------------------------------------------

Asset Retirement Obligation, Beginning of Year $ 611 $ 383
Liabilities Incurred 30 98
Liabilities Settled (5) (16)
Liabilities Disposed - (35)
Change in Estimated Future Cash Flows (3) 124
Accretion Expense 9 22
Other (3) 35
-------------------------------------------------------------------------
Asset Retirement Obligation, End of Period $ 639 $ 611
-------------------------------------------------------------------------
-------------------------------------------------------------------------

9. SHARE CAPITAL

March 31, 2005 December 31, 2004
-------------------------------------
(millions) Number Amount Number Amount
-------------------------------------------------------------------------

Common Shares Outstanding,
Beginning of Year 450.3 $ 5,299 460.6 $ 5,305
Shares Issued under Option Plans 2.8 101 9.7 281
Shares Repurchased (12.3) (190) (20.0) (287)
-------------------------------------------------------------------------
Common Shares Outstanding, End of
Period 440.8 $ 5,210 450.3 $ 5,299
-------------------------------------------------------------------------
-------------------------------------------------------------------------

During the quarter, the Company purchased 12,255,029 Common Shares for
total consideration of approximately $760 million. Of the amount paid,
$190 million was charged to Share capital, $10 million was charged to
Paid in surplus and $560 million was charged to Retained earnings.
Included in the above are 1.3 million Common Shares which have been
repurchased by a wholly owned Trust and are held for issuance upon
vesting of units under EnCana's Performance Share Unit plan
(see Note 10).

On October 26, 2004, the Company received regulatory approval for a new
Normal Course Issuer Bid commencing October 29, 2004. Under this bid, the
Company may purchase for cancellation up to 23,114,500 of its Common
Shares, representing five percent of the approximately 462.29 million
Common Shares outstanding as of the filing of the bid on October 22,
2004. On February 4, 2005, the Company received regulatory approval for
an amendment to the Normal Course Issuer Bid which increases the number
of shares available for purchase from five percent of the issued and
outstanding Common Shares to ten percent of the public float of Common
Shares (a total of approximately 46.1 million Common Shares). The current
Normal Course Issuer Bid expires on October 28, 2005.

The Company has stock-based compensation plans that allow employees and
directors to purchase Common Shares of the Company. Option exercise
prices approximate the market price for the Common Shares on the date the
options were issued. Options granted under the plans are generally fully
exercisable after three years and expire five years after the grant date.
Options granted under predecessor and/or related company replacement
plans expire up to ten years from the date the options were granted.

The following tables summarize the information about options to purchase
Common Shares that do not have Tandem Share Appreciation Rights
("TSAR's") attached to them at March 31, 2005. Information related to
TSAR's is included in Note 10.
Weighted
Stock Average
Options Exercise
(millions) Price (C$)
-------------------------------------------------------------------------

Outstanding, Beginning of Year 18.1 46.29
Exercised (2.8) 44.34
Forfeited (0.1) 43.54
-------------------------------------------------------------------------
Outstanding, End of Period 15.2 46.67
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Exercisable, End of Period 8.0 45.43
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Outstanding Options Exercisable Options
------------------------------------------------------------
Weighted
Number of Average Weighted Number of Weighted
Range of Options Remaining Average Options Average
Exercise Outstanding Contractual Exercise Outstanding Exercise
Price (millions) Life (years) Price (C$) (millions) Price (C$)
-------------------------------------------------------------------------

20.00 to 24.99 0.5 3.7 22.84 0.5 22.84
25.00 to 29.99 0.2 1.9 26.20 0.2 26.20
30.00 to 43.99 0.3 1.6 40.00 0.3 39.61
44.00 to 53.00 14.2 2.2 48.01 7.0 47.92
-------------------------------------------------------------------------
15.2 2.3 46.67 8.0 45.43
-------------------------------------------------------------------------
-------------------------------------------------------------------------

EnCana has recorded stock-based compensation expense in the Consolidated
Statement of Earnings for stock options granted to employees and
directors in 2003 using the fair-value method. Stock options granted in
2004 and 2005 have an associated Tandem Share Appreciation Right
attached. Compensation expense has not been recorded in the Consolidated
Statement of Earnings related to stock options granted prior to 2003. If
the Company had applied the fair-value method to options granted prior to
2003, pro forma Net Earnings and Net Earnings per Common Share for the
three months ended March 31, 2005 would be unchanged (2004 -
$281 million; $0.61 per common share - basic; $0.60 per common share -
diluted).

10. COMPENSATION PLANS

The tables below outline certain information related to EnCana's
compensation plans at March 31, 2005. Additional information is contained
in Note 16 of the Company's annual audited Consolidated Financial
Statements for the year ended December 31, 2004.

A) Pensions

The following table summarizes the net benefit plan expense:

Three Month Ended
March 31,
-----------------------
2005 2004
-------------------------------------------------------------------------

Current Service Cost $ 2 $ 2
Interest Cost 3 3
Expected Return on Plan Assets (3) (3)
Amortization of Net Actuarial Loss 1 1
Amortization of Transitional Obligation (1) (1)
Amortization of Past Service Cost 1 -
Expense for Defined Contribution Plan 5 3
-------------------------------------------------------------------------
Net Benefit Plan Expense $ 8 $ 5
-------------------------------------------------------------------------
-------------------------------------------------------------------------

The Company previously disclosed in its annual audited Consolidated
Financial Statements for the year ended December 31, 2004 that it
expected to contribute $6 million to its defined benefit pension plans in
2005. At March 31, 2005, no contributions have been made.

B) Share Appreciation Rights ("SAR's")

The following table summarizes the information about SAR's at March 31,
2005:
Weighted
Average
Outstanding Exercise
SAR's Price
-------------------------------------------------------------------------

Canadian Dollar Denominated (C$)
Outstanding, Beginning of Year 465,255 36.61
Exercised (268,558) 29.81
-------------------------------------------------------------------------
Outstanding, End of Period 196,697 45.89
-------------------------------------------------------------------------
Exercisable, End of Period 196,697 45.89
-------------------------------------------------------------------------
-------------------------------------------------------------------------

U.S. Dollar Denominated (US$)
Outstanding, Beginning of Year 385,930 28.80
Exercised (73,760) 28.99
-------------------------------------------------------------------------
Outstanding, End of Period 312,170 28.75
-------------------------------------------------------------------------
Exercisable, End of Period 312,170 28.75
-------------------------------------------------------------------------
-------------------------------------------------------------------------

During the quarter, EnCana recorded compensation costs of $9 million
related to the outstanding SAR's (2004 - $2 million).

C) Tandem Share Appreciation Rights ("TSAR's")

The following table summarizes the information about Tandem SAR's at
March 31, 2005:
Weighted
Average
Outstanding Exercise
TSAR's Price
-------------------------------------------------------------------------

Canadian Dollar Denominated (C$)
Outstanding, Beginning of Year 867,500 55.54
Granted 3,262,806 76.51
Exercised (12,300) 52.99
Forfeited (69,620) 60.59
-------------------------------------------------------------------------
Outstanding, End of Period 4,048,386 72.35
-------------------------------------------------------------------------
Exercisable, End of Period 38,595 53.85
-------------------------------------------------------------------------
-------------------------------------------------------------------------

During the quarter, EnCana recorded compensation costs of $5 million
related to the outstanding TSAR's (2004 - nil).

D) Deferred Share Units ("DSU's")

The following table summarizes the information about DSU's at March 31,
2005:
Weighted
Average
Outstanding Exercise
DSU's Price
-------------------------------------------------------------------------

Canadian Dollar Denominated (C$)
Outstanding, Beginning of Year 375,306 49.61
Granted, Directors 23,806 85.43
Units, in Lieu of Dividends 562 85.43
-------------------------------------------------------------------------
Outstanding, End of Period 399,674 51.79
-------------------------------------------------------------------------
Exercisable, End of Period 318,208 55.05
-------------------------------------------------------------------------
-------------------------------------------------------------------------

During the quarter, EnCana recorded compensation costs of $5 million
related to the outstanding DSU's (2004 - $3 million).

E) Performance Share Units ("PSU's")

The following table summarizes the information about PSU's at March 31,
2005:
Weighted
Average
Outstanding Exercise
PSU's Price
-------------------------------------------------------------------------

Canadian Dollar Denominated (C$)
Outstanding, Beginning of Year 1,647,103 53.42
Granted 852,941 76.51
Forfeited (14,277) 56.48
-------------------------------------------------------------------------
Outstanding, End of Period 2,485,767 61.32
-------------------------------------------------------------------------
Exercisable, End of Period - -
-------------------------------------------------------------------------
-------------------------------------------------------------------------

U.S. Dollar Denominated (US$)
Outstanding, Beginning of Year 224,615 41.12
Granted 193,193 61.95
Forfeited (8,163) 55.07
-------------------------------------------------------------------------
Outstanding, End of Period 409,645 50.66
-------------------------------------------------------------------------
Exercisable, End of Period - -
-------------------------------------------------------------------------
-------------------------------------------------------------------------

During the quarter, EnCana recorded compensation costs of $14 million
related to the outstanding PSU's (2004 - nil).

At March 31, 2005, EnCana has approximately 1.3 million Common Shares
held in trust for issuance upon vesting of the PSU's.

11. PER SHARE AMOUNTS

The following table summarizes the Common Shares used in calculating
Net Earnings per Common Share:

Three Months Ended
March 31,
-----------------------
(millions) 2005 2004
-------------------------------------------------------------------------

Weighted Average Common Shares Outstanding
- Basic 445.9 460.9
Effect of Dilutive Securities 8.6 6.2
-------------------------------------------------------------------------
Weighted Average Common Shares Outstanding
- Diluted 454.5 467.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------

12. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

As discussed in Note 2 to the annual audited Consolidated Financial
Statements for the year ended December 31, 2004, on January 1, 2004, the
fair value of all outstanding financial instruments that were not
considered accounting hedges was recorded in the Consolidated Balance
Sheet with an offsetting net deferred loss amount (the "transition
amount"). The transition amount is recognized into net earnings over the
life of the related contracts. Changes in fair value after that time are
recorded in the Consolidated Balance Sheet with an associated unrealized
gain or loss recorded in net earnings. The estimated fair value of all
derivative instruments is based on quoted market prices or, in their
absence, third party market indications and forecasts.

At March 31, 2005, a net unrealized gain remains to be recognized over
the next four years as follows:

Unrealized
Gain (Loss)
-------------------------------------------------------------------------

2005
Three months ended June 30, 2005 $ 14
Three months ended September 30, 2005 9
Three months ended December 31, 2005 9
-------------------------------------------------------------------------
Total remaining to be recognized in 2005 $ 32
-------------------------------------------------------------------------

2006 $ 24
2007 15
2008 1
-------------------------------------------------------------------------
Total to be recognized in 2006 through to 2008 $ 40
-------------------------------------------------------------------------

-------------------------------------------------------------------------
Total to be recognized $ 72
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Total to be recognized - Continuing Operations $ 73
Total to be recognized - Discontinued Operations (1)
-------------------------------------------------------------------------
$ 72
-------------------------------------------------------------------------
-------------------------------------------------------------------------

The following table presents a reconciliation of the change in the
unrealized amounts from January 1, 2005 to March 31, 2005:

Net
Deferred
Amounts Total
Recognized Fair Market Unrealized
on Transition Value Gain (Loss)
-------------------------------------------------------------------------

Fair Value of Contracts,
Beginning of Year $ (72) $ (189)

Change in Fair Value of Remaining
Contracts in Place at Transition - (2) $ (2)
Fair Value of Contracts Entered into
Since January 1, 2004 - (987) (987)
-------------------------------------------------------------------------
Fair Value of Contracts Outstanding $ (72) $(1,178) $ (989)
-------------------------------------------------------------------------

Unamortized Premiums Paid on
Collars and Options 90
-------------------------------------------------------------------------
Fair Value of Contracts Outstanding
and Premiums Paid, End of Period $(1,088)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Amounts Allocated to Continuing
Operations $ (73) $ (996) $ (969)
Amounts Allocated to Discontinued
Operations 1 (92) (20)
-------------------------------------------------------------------------
$ (72) $(1,088) $ (989)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

The total realized loss recognized in net earnings from continuing
operations for the three months ended March 31, 2005 was $10 million
($15 million, before tax).

At March 31, 2005, the net deferred amounts recognized on transition and
the risk management amounts are recorded in the Consolidated Balance
Sheet as follows:

As at
March 31, 2005
-------------------------------------------------------------------------

Remaining Deferred Amounts Recognized on Transition
Accounts receivable and accrued revenues $ 3
Investments and other assets 1

Accounts payable and accrued liabilities 40
Other liabilities 37
-------------------------------------------------------------------------
Net Deferred Gain - Continuing Operations $ 73
Net Deferred Loss - Discontinued Operations (1)
-------------------------------------------------------------------------
$ 72
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Risk Management
Current asset $ 159
Long-term asset 72

Current liability 826
Long-term liability 401
-------------------------------------------------------------------------
Net Risk Management Liability - Continuing Operations $ (996)
Net Risk Management Liability - Discontinued Operations (92)
-------------------------------------------------------------------------
$ (1,088)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

A summary of all unrealized estimated fair value financial positions is
as follows:

As at
March 31, 2005
-------------------------------------------------------------------------

Commodity Price Risk
Natural gas $ (739)
Crude oil (285)
Power 5
Interest Rate Risk 23
-------------------------------------------------------------------------
Total Fair Value Positions - Continuing Operations $ (996)
Total Fair Value Positions - Discontinued Operations (92)
-------------------------------------------------------------------------
$ (1,088)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Information with respect to power and interest rate risk contracts in
place at December 31, 2004 is disclosed in Note 17 to the Company's
annual audited Consolidated Financial Statements. No significant new
contracts have been entered into as at March 31, 2005.

Natural Gas

At March 31, 2005, the Company's gas risk management activities from
financial contracts had an unrealized loss of $798 million and a fair
market value position of $(739) million. The contracts were as follows:

Notional
Volumes Fair Market
(MMcf/d) Term Average Price Value
-------------------------------------------------------------------------

Sales Contracts
Fixed Price Contracts
NYMEX Fixed Price 485 2005 6.43 US$/Mcf $ (194)
Colorado Interstate
Gas (CIG) 114 2005 4.87 US$/Mcf (68)
Other 110 2005 5.21 US$/Mcf (65)

NYMEX Fixed Price 525 2006 5.66 US$/Mcf (373)
Colorado Interstate
Gas (CIG) 100 2006 4.44 US$/Mcf (87)
Other 171 2006 4.85 US$/Mcf (144)

Collars and Other Options
Purchased NYMEX Put
Options 901 2005 5.47 US$/Mcf (53)
NYMEX 3-Way Call
Spread 180 2005 5.00/6.69/7.69 US$/Mcf (39)

Purchased NYMEX Put
Options 210 2006 5.00 US$/Mcf (15)

Basis Contracts
Fixed NYMEX to AECO
Basis 881 2005 (0.66) US$/Mcf 54
Fixed NYMEX to
Rockies Basis 254 2005 (0.48) US$/Mcf 21
Other 474 2005 (0.49) US$/Mcf 7

Fixed NYMEX to AECO
Basis 703 2006 (0.65) US$/Mcf 54
Fixed NYMEX to
Rockies Basis 312 2006 (0.57) US$/Mcf 18
Fixed NYMEX to CIG
Basis 279 2006 (0.83) US$/Mcf (5)
Other 182 2006 (0.36) US$/Mcf 3

Fixed Rockies to CIG
Basis 12 2007 (0.10) US$/Mcf -
Fixed NYMEX to AECO
Basis 345 2007-2008 (0.65) US$/Mcf 36
Fixed NYMEX to
Rockies Basis 252 2007-2008 (0.58) US$/Mcf 23
Fixed NYMEX to CIG
Basis 115 2007-2009 (0.69) US$/Mcf 6

Purchase Contracts
Fixed Price Contracts
Waha Purchase 27 2005 5.90 US$/Mcf 11
Waha Purchase 23 2006 5.32 US$/Mcf 15

-------------------------------------------------------------------------
(795)
Other Financial Positions(1) (3)
-------------------------------------------------------------------------
Total Unrealized Loss on Financial Contracts (798)
Unamortized Premiums Paid on Options 59
-------------------------------------------------------------------------
Total Fair Value Positions $ (739)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) Other financial positions are part of the ongoing operations of the
Company's proprietary production management and gas storage
optimization activities.

Crude Oil

At March 31, 2005, the Company's oil risk management activities from
financial contracts had an unrealized loss of $408 million and a fair
market value position of $(377) million. The contracts were as follows:

Notional
Volumes Average Price Fair Market
(bbl/d) Term (US$/bbl) Value
-------------------------------------------------------------------------

Fixed WTI NYMEX
Price 41,000 2005 28.41 $ (311)
Costless 3-Way
Put Spread 9,000 2005 20.00/25.00/28.78 (66)
Unwind WTI NYMEX
Fixed Price (4,500) 2005 35.90 25
Purchased WTI NYMEX
Call Options (38,000) 2005 49.76 77
Purchased WTI NYMEX
Put Options 35,000 2005 40.00 (16)

Fixed WTI NYMEX
Price 15,000 2006 34.56 (109)
Purchased WTI NYMEX
Put Options 22,000 2006 27.36 (7)
-------------------------------------------------------------------------
(407)
Other Financial Positions(1) (1)
-------------------------------------------------------------------------
Total Unrealized Loss on Financial Contracts (408)
Unamortized Premiums Paid on Options 31
-------------------------------------------------------------------------
Total Fair Value Positions $ (377)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Total Fair Value Positions - Continuing Operations (285)
Total Fair Value Positions - Discontinued Operations (92)
-------------------------------------------------------------------------
$ (377)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) Other financial positions are part of the ongoing operations of the
Company's proprietary production management.


13. RECLASSIFICATION

Certain information provided for prior periods has been reclassified to
conform to the presentation adopted in 2005.

Further information on EnCana Corporation is available on the company's Web site, www.encana.com.

For further information please contact EnCana Corporation:

Investor contact:
EnCana Corporate Development
Sheila McIntosh
Vice-President, Investor Relations
403-645-2194

Paul Gagne
Manager, Investor Relations
403-645-4737

Ryder McRitchie
Manager, Investor Relations
403-645-2007

Media contact:
Alan Boras
Manager, Media Relations
403-645-4747
investor.relations@encana.com

ECA stock price

TSX $14.99 Can 0.060

NYSE $11.75 USD 0.110

As of 2017-11-22 16:02. Minimum 15 minute delay