On Wednesday, Encana Corp (NYSE:ECA) reported its second quarter earnings and discussed the following topics in its earnings conference call. Take a look.
Income Tax Recovery Estimate
Greg Pardy – RBC Capital Markets: I think Randy you addressed most of what I was going to ask, but I did want to query just on where Sherri’s expecting cash taxes to roll out this year and then secondly as we move into 2013, will you continue to have nice tax shelter and so forth as you move forward?
Sherri A. Brillon – EVP and CFO: It’s Sherri Brillon. Encana’s currently estimating an income tax recovery through the year of approximately $300 million including the transactions that closed as of June 30th. The estimate will be impacted by our future divestitures and transactions and any other changes as they relate to the cash flow for year end and we’ll update it as we go through the quarters. For next year, I had indicated at Investor Day, we were thinking of a cash tax of about $100 million and so we are basically well positioned going into next year relative to our cash tax provision.
Emerging Liquids Plays in the U.S.
Andrew Potter – CIBC: Just one quick question first just on the investigation. I know you don’t want to answer anything specifically, but just I think everybody’s kind of wondering if there was any color in terms of timing like this, is this investigation like they’d go on for months, are we talking next year, just any color like that, and then also just wanted to confirm whether or not the Michigan lands are still in the U.S. package or whether those has been taken out? Then I have a few other questions after that unrelated to the investigation?
Randall K. Eresman – President and CEO: Andrew, we do have to reiterate that we are not in a position to provide any further updates regarding Michigan matter at this time. However, I can confirm that we have taken the Michigan assets out of the U.S. liquids package.
Andrew Potter – CIBC: Then just moving on – just one question in general on the emerging liquids plays in the U.S., what are typical land tenures on a lot of these plays, like they had just been very general here, but I mean like what are typical well perception and over how long of a time period typically would you have to drill (to hold land)?
Randall K. Eresman – President and CEO: I’ll have Jeff Wojahn and Eric Marsh to (tag team) on this one.
Eric D. Marsh – EVP, Natural Gas Economy and SVP, USA Division: The tenures on most of the U.S. are usually three plus two, so total of five, sometimes you have three years and then you have a kicker and you can extend it for another two years. So the Mississippian and the TMS are three plus twos typically, occasionally some five-year leases as well, but I think in Michigan or in San Juan it’s a bit different than that. Jeff?
Jeff E. Wojahn – EVP and President, USA Division: In federal land, there is also the opportunity to build units, and in those cases the land can be held for a much longer period of time.
Andrew Potter – CIBC: How many wells is it typically on the non-federal lands do you have to drill on like to hold the section, for instance?
Randall K. Eresman – President and CEO: Yeah, on non-federal lands, one well typically will hold the lease, Andrew.
Andrew Potter – CIBC: Then the last question is just on the NGLs; you’ve done a good job (indiscernible) deep cut growth and stuff in Alberta. Is there any opportunity for NGL in the U.S. Rockies portfolio beyond what you’re doing right now?
Randall K. Eresman – President and CEO: Jeff, could you talk about NGL growth potential in the U.S. Rockies region or anywhere else in the U.S.?
Jeff E. Wojahn – EVP and President, USA Division: I’m sorry, Andrew, I couldn’t hear your question well. This is one of the areas that we’re exploring right now is the natural gas liquids growth potential in the Rockies. Clearly we have natural gas liquids opportunities in the DJ Basin where we’re currently connecting a program there. Jonah field as well has about 10 barrels per million of condensate plus the upside around natural gas liquids in the Piceance Basin also has natural gas liquids opportunities. So, there’s a number of objectives around that. We’re evaluating that further and I think we’ll have more guidance around that as we (firm up our) 2013 plans.
Andrew Potter – CIBC: So that would be kind of incremental to what you’ve laid out there already I guess.
Randall K. Eresman – President and CEO: Yeah, Andrew, it’s fair to say that a lot of our gas in the Rockies is relative higher BTU content gas. Some of the contract arrangements that we have in place today need to be modified in order for us to capture the gas and we’re working on that and that’s what Jeff is referring to.