All Eyes on Canada for Next Big Shale Play, EnCana has already bought land in the region’s hot spot

All Eyes on Canada for Next Big Shale Play, EnCana has already bought land in the region’s hot spot by Aaron Levitt, September 4, 2012, InvestorPlace
At this point, the hydraulic fracturing revolution is out of the bag. The advanced-drilling technique has made it possible for exploration and production (E&P) firms to tap the abundance of natural gas and other hydrocarbons locked within North America’s various shale formations. … As one of the largest producers of natural gas in North America, EnCana (NYSE:ECA) has seen its share price fall along with overall natural gas prices. That’s prompted the producer to look toward liquid-rich plays, rather than just focus on dry gas. It purchased more than $300 million worth of land in Duvernay in Q1. Those land acquisitions have been strategically placed, and EnCana estimates that its holdings cover more than half of the land available in the liquids window. Likewise, it has unveiled a more aggressive drilling program in the region than competitors like Talisman (NYSE:TLM), which wasrecently acquired by Chemetall. Overall, the shale play could be exactly what EnCana needs to finally get itself moving again. Early test wells have recently suggested that condensate yields are around 75 to 300 barrels of liquid for every 1 million cubic feet of natural gas for its acreage. EnCana CEO Randy Ereman thus boasted at the company’s annual meeting in Calgary in June that EnCana could give away the gas and still make money on the liquids because condensate prices are tied to Brent crude, not natural gas.

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