EnCana closes sale of interest in offshore Brazil oil discovery to Norsk Hydro for US$350 million

CALGARY, Alberta (August 16, 2006) - EnCana Corporation (TSX, NYSE: ECA) has closed the previously announced sale of its 50 percent interest in the Chinook heavy oil discovery offshore Brazil to Norsk Hydro ASA for approximately US$350 million. Under the agreement, Norsk Hydro purchased all of the shares of an EnCana subsidiary holding a 50 percent interest in Block BM-C-7, located in the Campos Basin. EnCana expects to record an after-tax gain in net earnings of more than US$200 million on the sale.

Upon the closing of this sale, EnCana now holds non-operated interests in 10 deep water exploration blocks offshore Brazil. Nine of these blocks are operated by Petrobras.

EnCana Corporation
With an enterprise value of approximately US$50 billion, EnCana is one of North America's leading natural gas producers, the largest holder 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 lower geological and commercial development risk, lower average decline rates and longer producing lives than conventional plays. EnCana common shares trade on the Toronto and New York stock exchanges under the symbol ECA.

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 or information within the meaning of the applicable securities legislation, collectively referred to herein as "forward-looking statements". Forward-looking statements in this news release include, but are not limited to: anticipated after-tax gains; anticipated exploration activities offshore Brazil; anticipated growth potential of the company's resource play portfolio; and anticipated total resource play life. 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 and assumptions regarding oil and gas prices; assumptions based on the company's current guidance; 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; risks associated with technology; 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; 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, except as required by law, 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.

Further information on EnCana Corporation is available on the company's website, www.encana.com, or by contacting:

Investor contact:
EnCana Corporate Finance
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 $14.27 Can 0

NYSE $11.11 USD 0

As of 2017-12-15 16:03. Minimum 15 minute delay