DBRS confirms Encana

DBRS said it confirmed the unsecured senior notes, medium-term notes and medium-term debentures of Encana Corp. and the unsecured long-term notes of Encana Holdings Finance Corp. at A (low) and the commercial paper rating of Encana at R-1 (low).

The trend is stable.

The ratings had previously been confirmed on Nov. 30, 2009 following the closing of the spinoff of the company's integrated oil and Canadian plains divisions into a new entity, Cenovus Energy Inc.

The agency said Encana's strengthened capital structure through further debt reduction, pre-spinoff, has helped to partly offset the modestly increased business risk associated with a more natural gas-weighted operation, and its liquidity arrangements are commensurate with its capital growth requirements.

In addition, the rating actions are based on DBRS' expectation and management's commitment that current target metrics (similar to those pre-spinoff) and other key financial principles, such as hedging policies, will remain in place and future capital investment programs, share repurchases and other related activities will be managed within these credit targets.

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