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EnCana Corp. pumps up first quarter production by 12 percent CEO Gwyn Morgan says company on target to boost output by 55% over next three years; 310 staff get severance packages as part of cost-cutting Gary Park PNA Canadian Correspondent
EnCana Corp. has rolled out its first set of numbers that show first-quarter production of 700,846 barrels of oil equivalent in the first quarter, up 12 percent from the combined output of its founding companies a year earlier.
Natural gas sales climbed 21 percent to 2.7 billion cubic feet per day, with the bulk of the increase coming from the U.S. Rocky Mountains and the Ladyfern and Greater Sierra regions of northeastern British Columbia. That gas brought $3.31 Canadian per thousand cubic feet, 64 percent less than a year ago.
Sales of oil and gas liquids averaged 246,846 barrels per day, down 1 percent. Average realized price was C$25.37 a barrel, down 10 percent.
The company showed net income of $186 million (Canadian) on revenues of C$2.08 billion, after subtracting royalties and production taxes.
Sales of oil and gas liquids averaged 246,846 barrels per day, down 1 percent.
The results were presented on a pro forma basis, as if the merger of PanCanadian Energy Corp. and Alberta Energy Co. Ltd. had occurred effective Jan. 1, 2002.
Target of 55 percent production growth Gwyn Morgan, EnCana president and chief executive officer, said the company is on track to achieved its targeted production growth of 55 percent to 1.1 million barrels of oil equivalent per day by 2005.
As well he said strong progress has been made towards the goals of slashing C$500 million a year in operating and capital costs.
Part of that program has included severance packages for 310 of the company’s 3,900 employees, plus a plan to close or sell its Houston-based gas marketing operation, which employs 100 people and trades about 2.3 billion cubic feet per day.
For its core onshore North American division, EnCana reported that it completed more than 1,000 net wells during the three months, easily cementing its place as Canada’s most active operator by drilling twice as many holes as the next busiest driller, Husky Energy Inc.
For Alberta alone, EnCana tallied 886 wells, trailed by Husky at 331, Burlington Resources Canada Energy Ltd. 163 and Canadian Natural Resources Ltd. 136.
In British Columbia, EnCana (exclusively through the efforts of AEC) logged 59 wells, edging out Burlington at 56, Nexen Inc. 42, Devon Energy Corp. 38 and Canadian Natural 35.
Only three wells were completed in northern Canada — one each by Devon, EOG Resources Canada Inc. and Anadarko Canada Corp. Drilling, production highlights Highlights from EnCana’s performance included:
Greater Sierra — drilling 45 wells during the winter and expects production to average 150 million cubic feet per day this year, doubling to 300 million by 2005.
Ladyfern — successfully drilled seven wells and has current production of 140 million cubic feet per day.
Coalbed methane — Six well on the Palliser Block in southern Alberta are producing at stable flow rates of 30,000 to 250,000 cubic feet per day, initiating the first CBM sales in Canada. Initial test results point to net recoverable reserves at 1 billion to 2 billion cubic feet.
Oil Sands — First quarter production from the Foster Creek project in northeastern Alberta averaged 13,200 barrels per day, up 22 percent from a year earlier. EnCana’s share of Syncrude oil sands production averaged 31,548 barrels per day, down 2 percent primarily because of unplanned maintenance, and operating costs dropped C$2.75 per barrel to an average C$17.73.
Ecuador — Oil output averaged 31,548 barrels per day, a drop of 7 percent because of pipeline constraints, but the goal remains 100,000 barrels per day by mid-2003.
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