Randy Eresman, CEO of Encana Corp.
As shale gas is having a major impact on the energy mix of North America, so is the Horn River having a major impact on individual companies.
Randy Eresman, CEO of EnCana Corp. – Canada’s largest gas producer – recently stated during a conference call that the Company’s Horn River basin project have been so encouraging that it is emerging as one of the Company’s top assets and has enough gas in it to be one of the most important gas discoveries in North America. Commenting further on Horn River Mr Eresman stated:
“The potential size and quality of this play along with a favourable royalty structure make it very competitive in the North American gas market.”
The size and scale of Horn River has already prompted EnCana to start selling off conventional gas assets in Alberta.
In response to weaker natural gas production, EnCana has shut in 300 to 400 million cubic feet a day, most of which is in US.
Furthermore, the company has set its long-term price expectation to a range of US$6 to US$7 per million British thermal units on the New York Mercantile Exchange. A price range consistent with most analysts and other industry players which forecast this range to be realized in early 2010. (see previous HRN post: “Four reasons why natural gas prices will not stay depressed”)
Mr. Eresman also stated:
“There’s an opportunity to expand the market for natural gas, to displace significant quantities of coal and crude oil.”
We agree. See HRN: “Natural gas will play an increased role in North American energy mix”
