Selling gas storage

EnCana announced today that it will divest its natural gas storage business, North America's largest independent gas storage network, via a competitive auction process or an initial public offering.

EnCana's planned divestiture is consistent with the company's other recent divestitures, such as the sale of UK North Sea assets, Gulf of Mexico interests, Western Canadian conventional producing assets, plus the planned sale of the company's Ecuador interests and its natural gas liquids business.

EnCana's natural gas storage assets are said to be located in key gas producing and consuming regions and are linked to intercontinental pipelines. EnCana Gas Storage has approximately 174 billion cubic feet of working gas capacity at five facilities in Alberta, California and Oklahoma.

The AECO Hub in Alberta is comprised of three facilities totalling 135 billion cubic feet of storage capacity. Wild Goose Gas Storage in northern California has 24 billion cubic feet of storage capacity and Salt Plains Gas Storage in Oklahoma has 15 billion cubic feet of storage capacity. EnCana is also developing a new gas storage project, Starks Gas Storage, in southwest Louisiana.

EnCana will retain ownership of its Hythe storage facility, which has 10 billion cubic feet of storage capacity, and may enter into other commercial storage arrangements with the new owner of the divested assets. EnCana will soon commence a formal divestiture process that is expected to be completed by early in 2006.