CALGARY, Alberta, Sept. 27, 2017 (GLOBE NEWSWIRE) — Encana (TSX:ECA) (NYSE:ECA) successfully started up the Tower processing plant ahead of schedule and under budget on September 20. The plant is the first of three Veresen Midstream facilities that support Encana’s condensate-focused growth plan in the Montney.
The Tower facility is in the process of ramping up. The two other new plants, Sunrise and Saturn, are also ahead of schedule and under budget with Sunrise expected to start up by mid-October and Saturn before year-end.
These new plants will more than double Encana’s Montney liquids production from the fourth quarter of 2016 to the fourth quarter of 2017. The company’s liquids and gas volumes in the play are expected to grow throughout 2018 as drilling programs bring the plants to full capacity.
“The Tower plant startup, delivered ahead of schedule and under budget, is an important milestone in our strategy and five-year plan,” said Doug Suttles, Encana President & CEO. “Liquids growth in the Montney is a key driver in expanding our corporate margin and delivering quality returns.”
Encana’s innovative midstream agreement with Veresen Midstream enables Encana, via the Cutbank Ridge Partnership, to construct and operate the three plants, as well as any future build opportunities, on behalf of Veresen Midstream on a contracted basis. Veresen Midstream funds and owns the facilities and Encana pays to use them through a fee-for-service agreement.
Encana remains on track to deliver its 2017 corporate guidance despite Hurricane Harvey and gas constraints this summer in western Canada. Impacts from Hurricane Harvey in the Eagle Ford and Permian were limited to approximately 3,500 barrels of oil equivalent per day (BOE/d) in the third quarter through well executed recovery plans and strong coordination between Encana’s operations, midstream and marketing teams.
In western Canada, TCPL system maintenance and an extended third party gas plant turnaround are expected to have a third quarter production impact of about 55 million cubic feet per day (MMcf/d). Throughout these gas curtailments, Encana prioritized liquids-rich gas production to minimize cash flow impacts.
Based on strong well performance across the portfolio and early Montney plant startups, Encana now expects production growth from its core assets to be towards the top end of its 25 to 30 percent guidance range from the fourth quarter of 2016 to the fourth quarter of 2017.
“We are committed to being an operator that can be counted on,” said Suttles. “We continue to grow margins, lower costs and drive efficiency. Our focus on creating a business that can deliver quality returns through the commodity cycle is paying off. We are firmly on track with our 2017 guidance and well positioned for 2018 when we expect to deliver significant value growth within cash flow.”
Encana is a leading North American energy producer that is focused on developing its strong portfolio of resource plays, held directly and indirectly through its subsidiaries, producing oil, natural gas liquids (NGLs) and natural gas. 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.