EnCana establishes substantial land and resource position in two promising North American natural gas shale plays



    EnCana names designated board members and executive teams for two new
    companies

    CALGARY, June 16 /CNW/ - EnCana Corporation (TSX, NYSE:   ECA) has
established a leading land and resource position in two of North America's
most exciting new natural gas resource plays, the Horn River Shale in
northeast British Columbia and the Haynesville Shale in Louisiana and Texas.
EnCana has drilled a series of exploration wells that has shown strong
potential to deliver commercial volumes of natural gas.
    "Recent exploration wells drilled by EnCana, its partners and industry,
indicate these two resource plays hold the potential to eventually become
amongst the largest in North America. Each of these plays has been compared in
size and scope to the prolific Barnett Shale in north central Texas, which
currently produces more than 3 billion cubic feet per day and continues to
grow. EnCana has assembled large land positions in each of these emerging
plays - 220,000 net acres in the heart of the Horn River Shale play and
325,000 net acres in the Haynesville Shale play fairway. These are very
meaningful positions, each with the potential to ultimately achieve production
levels approaching 1 billion cubic feet per day net to EnCana, which is
comparable in size to the potential we have announced in our more-established
plays at Montney in northeast B.C. and Deep Bossier in East Texas," said Randy
Eresman, EnCana's President & Chief Executive Officer.
    "The EnCana team has had tremendous success in finding and unlocking the
potential of some of the largest new unconventional natural gas plays in North
America. Incorporating these plays into EnCana's already very strong portfolio
has the potential to significantly accelerate EnCana's growth rate to an even
higher sustainable level. At the same time, we expect that as these plays
mature in their development, they will have a positive impact on our already
very low natural gas supply cost, thus ensuring profitability under a wide
range of future prices. I am extremely proud of the achievements of our
teams," Eresman said.

    Strong prices likely to enhance 2008 activity levels and capital
    investment

    "With the strong production from across our resource plays, and higher
than budgeted cash flow due to robust commodity prices, we expect to increase
drilling and continue expanding our land holdings in our shale play areas. At
the same time, we will continue to high-grade our portfolio of assets through
the divestiture of non-core properties through the balance of 2008," Eresman
said.

    EnCana largest landholder in Horn River natural gas play

    EnCana discovered the Horn River natural gas play in 2003 and has since
added extensive acreage to become the largest landholder in the northeast B.C.
basin. In 2007 EnCana formed a 50/50 joint venture on a portion of the play
with Apache Corporation. EnCana and Apache have been the most active drillers
in the basin. Together they have drilled nine production wells. In the first
quarter of 2008, Apache drilled three horizontal wells with initial natural
gas test rates of 8.8 million cubic feet per day (MMcf/d), 6.1 MMcf/d and
5.3 MMcf/d. EnCana has drilled four additional wells that are currently in
various stages of completion. The wells are drilled and completed using
similar techniques to those successfully implemented in the Barnett Shale in
Texas - large multistage fracs in long-reach horizontal wells. Although the
first two of these recent four wells have just begun to flow, early results
are indicating strong production potential.
    "We have been working on this play for several years and have established
a leading land and technology position in what we believe could become one of
the most significant shale gas plays in North America. The Horn River Shale is
an emerging play in a remote northern location that will require substantial
road and pipeline installation before full-scale development can occur.
Advances in our multi-stage fracturing and horizontal drilling are expected to
improve the economics of the play in the months and years ahead. The B.C.
government continues to work with industry setting the business foundation
that helps advance these unconventional natural gas plays," said Mike Graham,
Executive Vice-President and President of Canadian Foothills Division.

    Haynesville Shale potential could rival Barnett Shale

    In the emerging Haynesville Shale, EnCana Oil & Gas (USA) Inc. acquired
its first leases in 2005, drilled its first three vertical wells in 2006, and
has been continually acquiring land. In 2007 EnCana Oil & Gas signed a 50/50
joint exploration agreement with Shell Exploration & Production, a division of
Royal Dutch Shell. To date the companies have drilled three vertical and two
horizontal wells and are currently operating two rigs in the area. EnCana
plans to operate five rigs by year-end and it is in an industry-leading
position in the play.
    "EnCana is a leader in finding and developing natural gas resource plays,
evidenced by the fact that we have captured large positions in substantially
all of the major unconventional gas plays in North America. The potential of
the Haynesville Shale play was established in February with the completion of
our first horizontal well. The gas well flowed at an initial production rate
of more than 8 MMcf/d, which would rank it amongst the most productive Barnett
Shale wells. The Haynesville Shale is on the verge of transforming from an
emerging play to one of significant commercial development, rivaling the
quality and scope of the Barnett Shale play," said Jeff Wojahn, Executive
Vice-President and President, USA Division.

    EnCana names designated board members and executive teams for two new
    companies

    On May 11, 2008, EnCana announced that its Board of Directors had
unanimously approved a proposal to split EnCana into two highly focused energy
companies. One is a pure-play natural gas company with an outstanding
portfolio of early life, North American natural gas resource plays, with a
working name of GasCo. The other is a fully integrated oil company with
industry-leading in-situ oilsands properties and top-performing refineries, as
well as an underlying foundation of reliable oil and gas resource plays. Its
working name is IOCo. For further information on this transaction see the
company's website, www.encana.com.

    EnCana has designated the following directors and executives for each of
the companies:

    GasCo Directors:

    David P. O'Brien (Chairman), Randall K. Eresman, Claire S. Farley, Barry
W. Harrison, Dale A. Lucas, Jane L. Peverett, Allan P. Sawin and Clayton H.
Woitas.

    GasCo Executives:

    Randall K. Eresman, President and Chief Executive Officer; Sherri
Brillon, Executive Vice-President and Chief Financial Officer; Mike Graham,
Executive Vice-President and President, Canadian Division; Bob Grant,
Executive Vice-President, Business Services, Canadian Division; Eric Marsh,
Executive Vice-President, Business Services, USA Division; Bill Oliver,
Executive Vice-President and Chief Corporate Officer; Bill Stevenson,
Executive Vice-President and Chief Accounting Officer; Jeff Wojahn, Executive
Vice-President and President, USA Division.

    IOCo Directors:

    Michael A. Grandin (Chairman), Ralph S. Cunningham, Patrick D. Daniel,
Ian W. Delaney, Randall K. Eresman, Brian C. Ferguson, Valerie A.A. Nielsen,
James M. Stanford, Wayne G. Thomson.

    IOCo Executives:

    Brian Ferguson, President and Chief Executive Officer; Ivor Ruste,
Executive Vice-President and Chief Financial Officer; John Brannan, Executive
Vice-President and President, Integrated Oil Division; Harbir Chhina,
Executive Vice-President, In-situ Oil Development; Kerry Dyte, Executive
Vice-President, General Counsel and Corporate Secretary; Judy Fairburn,
Executive Vice-President, Environment & Strategic Planning; Sheila McIntosh,
Executive Vice-President, Communications & Stakeholder Relations; Don Swystun,
Executive Vice-President and President, Canadian Plains Division; Hayward
Walls, Executive Vice-President, Organization & Workplace Development.
    Gerry Protti will become Executive Advisor to IOCo. He will also be
responsible for representation of IOCo in his current role as Chairman of the
Canadian Association of Petroleum Producers (CAPP).

    EnCana Corporation

    With an enterprise value of approximately US$80 billion, EnCana is a
leading North American unconventional natural gas and integrated oil company.
By partnering with employees, community organizations and other businesses,
EnCana contributes to the strength and sustainability of the communities where
it operates. 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 and the proposed transaction described above in this news
release, including management's assessment of future plans and operations
relating to GasCo and IOCo, EnCana has included in this news release certain
statements and information that are forward-looking statements or information
within the meaning of applicable securities legislation, and which are
collectively referred to herein as "forward-looking statements." The
forward-looking statements in this news release include, but are not limited
to, statements and tables with respect to: the proposed transaction and
expected future attributes of each of GasCo and IOCo following such
transaction; the anticipated benefits of the transaction; future production
growth; the potential success, production and timing of the Horn River and
Haynesville natural gas shale plays; anticipated drilling; anticipate cash
flow; anticipated resource potential; anticipated technological developments;
anticipated supply cost; anticipated profitability and the anticipated
directors and executives of GasCo and IOCo.
    Readers are cautioned not to place undue reliance on forward-looking
statements, as there can be no assurance that the future circumstances,
outcomes or results anticipated in or implied by such forward-looking
statements will occur or that plans, intentions or expectations upon which the
forward-looking statements 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 circumstances, events or outcomes anticipated or implied by
forward-looking statements will not occur, which may cause the actual
performance and financial results in future periods to differ materially from
the performance or results anticipated or implied by any such forward-looking
statements. These risks and uncertainties include, among other things: risks
associated with the ability to obtain any necessary approvals, waivers,
consents, court orders and other requirements necessary or desirable to permit
or facilitate the proposed transaction (including, regulatory and shareholder
approvals); the risk that any applicable conditions of the proposed
transaction may not be satisfied; volatility of and assumptions regarding oil
and gas prices; assumptions contained in or relevant to the company's current
corporate guidance; fluctuations in currency and interest rates; product
supply and demand; market competition; risks inherent in marketing operations
(including credit risks); imprecision of reserves estimates and estimates of
recoverable quantities of oil, bitumen, natural gas and liquids from resource
plays and other sources not currently classified as proved reserves; the
ability to successfully manage and operate the integrated North American
oilsands business with ConocoPhillips; refining and marketing margins;
potential disruption or unexpected technical difficulties in developing new
products and manufacturing processes; potential failure of new products to
achieve acceptance in the market; unexpected cost increases or technical
difficulties in constructing or modifying manufacturing or refining
facilities; unexpected difficulties in manufacturing, transporting or refining
synthetic crude oil; risks associated with technology and the application
thereof to the business of GasCo and IOCo; the ability to replace and expand
oil and gas reserves; the ability to generate sufficient cash flow from
operations to meet current and future obligations; the ability to access
external sources of debt and equity capital; the timing and the costs of well
and pipeline construction; the ability to secure adequate product
transportation; changes in royalty, tax, environmental and other laws or
regulations or the interpretations of such laws or regulations; applicable
political and economic conditions; the risk of war, hostilities, civil
insurrection, political instability and terrorist threats; risks associated
with existing and potential future lawsuits and regulatory actions; 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.





For further information:

For further information: on EnCana Corporation is available on the
company's website, www.encana.com, or by contacting: EnCana Corporate
Communications, Investor contact: Paul Gagne, Vice-President, Investor
Relations, (403) 645-4737; Ryder McRitchie, Manager, Investor Relations, (403)
645-2007; Susan Grey, Manager, Investor Relations, (403) 645-4751; Media
contact: Alan Boras, Manager, Media Relations, (403) 645-4747

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Encana Corporation

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