North America’s leading independent producer EnCana Corp. is on track to also become the largest independent gas storage owner and operator on the continent, after announcing plans Thursday to develop a new 40 Bcf natural gas storage facility in southeastern Alberta. The Countess development, once completed, is expected to increase EnCana’s Western Canadian gas storage by almost 40%, totaling approximately 135 Bcf. Once Countess is complete, EnCana will own and operate about 180 Bcf of gas storage capacity across North America, with facilities in Alberta, California and Oklahoma.

The Countess storage facility, designed for peak injections of 950 MMcf/d and peak withdrawals of 1,250 MMcf/d, will use two depleted underground natural gas reservoirs located about 85 kilometers east of Calgary. The first 10 Bcf of new storage capacity is scheduled to be available in the second quarter of 2003. The full 40 Bcf of space is expected to be available in April 2005. EnCana’s facility will be operated commercially as part of the AECO Hub, which is comprised of 85 Bcf of capacity at Suffield, in southeast Alberta, and 10 Bcf of storage at Hythe, in northwest Alberta.

“As natural gas markets continue to grow, so does the industry’s anticipated demand for storage,” said Bill Oliver, EnCana’s president for the Midstream & Marketing division. “The addition of this facility should help strengthen EnCana’s position as the largest independent gas storage owner and operator in North America. With daily production of approximately 2.8 Bcf, EnCana is also North America’s largest independent gas producer.”

Oliver said EnCana’s new Countess facility will not only be used to help manage sales and optimize the value of the company’s produced gas, but will also expand the Canadian capacity available to other producers and marketers for managing gas supplies and sales.

Construction is currently under way to double the capacity of EnCana’s Wild Goose storage facility in Northern California to 29 Bcf. With the two expansion projects complete by 2005, total peak withdrawal capacity of EnCana’s North American storage network is expected to grow to approximately 4 Bcf/d.

“The development of this facility exemplifies an ideal business opportunity resulting from the merger of EnCana’s predecessor companies,” said Oliver. “The Countess reservoir first produced gas for PanCanadian Energy Corp. in 1984. Now depleted, it has a second life as a new and vital part of the AECO Hub,” established by Alberta Energy Co. Ltd. in 1998.

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