FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of
of the Securities Exchange Act of 1934

ENCANA CORPORATION

1800, 855 - 2^nd Street SW
Calgary, Alberta, Canada T2P 2S5
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F __ Form 40-F [ü]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): __

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): __

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes __ No [ü]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-__

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Form 6-K Exhibit Index

EnCana’s third quarter oil and gas sales up 22 percent

to 781,000 BOE per day; cash flow exceeds US$1.36 billion

Calgary, Alberta (October 27, 2004) — EnCana Corporation (TSX & NYSE: ECA) today reported third quarter sales growth of more than 22 percent to 781,000 barrels of oil equivalent (BOE) per day, a 40 percent increase in cash flow to US$1,363 million, or $2.92 per share diluted and a doubling of operating earnings to $559 million, or $1.20 per share diluted, compared to the third quarter of 2003.

EnCana reports in U.S. dollars and according to U.S. protocols in order to facilitate a more direct comparison to other North American upstream oil and natural gas exploration and development companies. Reserves and production are reported on an after-royalties basis. All figures are in U.S. dollars unless otherwise noted.

Third quarter operating earnings rise 104 percent to $559 million

EnCana’s third quarter operating earnings of $559 million, or $1.20 per share diluted, were up 104 percent from $274 million in the third quarter of 2003. Third quarter operating earnings exclude an after-tax unrealized mark-to-market loss of $321 million related to price hedges and an after-tax unrealized gain of $155 million due to changes in foreign exchange on translation related to U.S. dollar denominated debt. After inclusion of these non-cash items, net earnings in the third quarter were $393 million, or 84 cents per share diluted, up 36 percent from the third quarter of 2003. Third quarter pre-tax cash flow was $1,487 million, up 45 percent from the same period in 2003. Third quarter after-tax cash flow of $1,363 million, or $2.92 per share diluted, includes a cash tax provision of $124 million, compared with $51 million of cash taxes in the same 2003 period. Third quarter revenues net of royalties were $2,458 million.

Third quarter gas sales up 24 percent in past year; oil and NGLs sales up 19 percent

Contributing to EnCana’s growth in operating earnings, third quarter natural gas sales increased 24 percent to 3.13 billion cubic feet per day compared to the third quarter of 2003. The increase was mainly driven by strong organic sales growth from resource plays at Greater Sierra, Cutbank Ridge and Southern Plains shallow gas in Canada and Mamm Creek in the U.S. Rockies, plus the acquisition of Tom Brown, Inc. (Tom Brown), which added an average of 275 million cubic feet per day during the quarter. EnCana’s third quarter oil and NGLs sales grew 19 percent to 259,000 barrels per day driven largely by sales growth from Canadian oilsands, Ecuador and the U.K. North Sea. Operating costs were $3.38 per BOE, down 4 percent from the third quarter of 2003. EnCana drilled 1,314 net wells in the third quarter. Core capital investment, excluding acquisitions and divestitures, was approximately $1.1 billion during the quarter.

Sales growth on track

EnCana is on track to achieve its 2004 sales guidance of between 725,000 and 765,000 BOE per day, which at the midpoint is a 15 percent increase from 2003 sales volumes. Projected sales are comprised of between 2.95 billion and 3.05 billion cubic feet of natural gas per day and between 235,000 and 255,000 barrels of oil and NGLs per day. Upstream core capital is expected to be in the range of $4,550 million and $4,850 million for 2004, unchanged from the company’s most recent guidance published in June 2004.

“EnCana continues to create exceptional value through investments in our portfolio of low-cost, long-life, North American resource plays. These unconventional assets are delivering unconventional production growth. In 2004 EnCana expects to achieve 15 percent sales growth, 80 percent of which is organic. Given our share buyback

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program in 2003 and 2004 to date, this would result in year-over-year sales growth of about 20 percent per share,” said Gwyn Morgan, EnCana’s President & Chief Executive Officer.

Third quarter gas price realizations up 11 percent, oil and NGLs price realizations up 55 percent

Third quarter realized pre-hedging North American natural gas prices were up about 11 percent from the third quarter of 2003 to $5.18 per thousand cubic feet. Realized pre-hedging oil and NGLs prices were up about 55 percent from the third quarter of 2003 to $32.83 per barrel.

Nine months cash flow exceeds $3.4 billion, sales up 21 percent

Pre-tax cash flow in the first nine months was $4,048 million, up 26 percent from the same 2003 period. After-tax, EnCana generated $3,489 million of cash flow, or $7.47 per share diluted, in the first nine months of 2004. This includes a cash tax provision in the first nine months of 2004 of $559 million, compared with a cash tax provision of $17 million in the same 2003 period. Daily sales in the first nine months averaged 758,000 BOE, up 21 percent from the first nine months of 2003. Daily sales were comprised of 2.96 billion cubic feet of gas and 265,000 barrels of oil and NGLs. In the first nine months, EnCana drilled 3,998 net wells, about 70 percent of the 5,500 net wells planned for 2004. Core capital investment, excluding acquisitions and divestitures, was $3,703 million for the first nine months of 2004.

Operating earnings in the first nine months were $1,403 million, up 32 percent

In the first nine months of 2004, EnCana achieved operating earnings of $1,403 million, or $3.00 per share diluted, up 32 percent from the first nine months of 2003. Net earnings in the first nine months were $933 million, or $2.00 per share diluted, which includes three non-cash items: an after-tax unrealized mark-to-market loss of $677 million, an after-tax unrealized gain on foreign exchange on US$ denominated debt issued in Canada of $98 million, and a $109 million gain due to tax rate changes. Nine month operating costs were $3.39 per BOE compared to $3.41 per BOE in the same period of 2003, which is in line with the full year 2004 operating cost forecast of between $3.30 and $3.50 per BOE. In the first nine months of 2004, revenues net of royalties were $8,026 million.

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Consolidated EnCana Highlights
US$ and U.S. protocols

Financial Highlights
(as at and for the period ended September 30)
(US$ millions, except per share amounts)

1 Operating EBITDA is net earnings from continuing operations before interest, income taxes, depreciation, depletion and amortization (DD&A), accretion of asset retirement obligation, foreign exchange loss (gain), gain on disposition and unrealized loss on risk management ($1,028 million, year-to-date, before tax).

2 Includes both property and corporate acquisitions and divestitures.

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Operating Highlights
(for the period ended September 30)

Risk management strategy

EnCana’s market risk mitigation strategy is designed to deliver greater predictability of cash flow and returns on investment. EnCana has hedged approximately 40 percent, about 1.3 billion cubic feet per day, of its projected fourth quarter 2004 natural gas sales at an average NYMEX equivalent price of $5.47 per thousand cubic feet. In addition, about 200 million cubic feet per day is subject to NYMEX collars at an average floor price of $4.43 per thousand cubic feet and an average ceiling price of $6.42 per thousand cubic feet. The company has also entered into longer term basis hedges specifically for the purpose of protecting against high U.S. Rockies gas price basis differentials. About half of EnCana’s projected 2004 oil sales are hedged with swaps or costless collars between $20 and $26 per barrel of WTI. In addition, for the balance of 2004, EnCana has also purchased call options with an average price of US$46.64, allowing EnCana to participate in oil price upside above this level. Detailed risk management positions at September 30, 2004 are presented in Note 14 to the unaudited third quarter consolidated financial statements. In the third quarter, EnCana’s financial commodity and currency risk management measures resulted in realized gross revenue being lower by approximately $265 million, comprised of $221 million on oil sales and $44 million on gas sales.

Hedging impact expected to wane in 2005

Due to the dramatic increase in world oil prices in 2004 and EnCana’s use of swaps and costless collars, the company experienced a substantial loss on its 2004 hedging program. About one quarter of EnCana’s 2005 forecast oil sales is hedged with swaps or collars at approximately $29 per barrel. EnCana has also purchased call options for 2005 at an average price of $49.76 per barrel, allowing EnCana to participate in oil price upside above this level. About 17 percent of EnCana’s 2005 forecast gas sales is hedged with swaps and collars at prices ranging from $4.90 to $6.70 per thousand cubic feet; on one third of these swaps/collars, call options have been purchased at an average price of $7.69, which will allow EnCana to participate in gas price upside above this level. EnCana has also purchased NYMEX gas put options with a floor price of $5.00 per thousand cubic feet covering a further 13 percent of forecast natural gas sales for 2005. EnCana will continue to use a variety of hedging instruments for its 2005 program including employing put options. These provide downside protection but do not limit the opportunity for the company to capture commodity price upside.

Resource plays continue to deliver strong growth

Across North America, EnCana’s portfolio of long-life, low-decline resource plays continues to deliver double-digit oil and gas production growth. Daily third quarter production from EnCana’s key North American resource plays has increased about 31 percent since the same period in 2003. This growth was generated primarily by increased gas production at four resource plays: Mamm Creek in Colorado, Greater Sierra and Cutbank Ridge in northeast B.C., and Southern Plains shallow gas on legacy Suffield and Palliser Blocks in southern Alberta. Oil production increases are from Foster Creek and Pelican Lake in northeast Alberta.

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Growth from key North American resource plays

3 Excludes Tom Brown production.

EnCana’s resource play production approaching 75 percent of North America portfolio

Throughout 2004, EnCana has been transitioning its North American asset portfolio to reduce the production contribution from mature conventional oil and gas assets in favour of increasing production from long-life, low-cost resource plays. This has been achieved three ways, first through the steady and focused investment in the company’s established resource plays, mainly at Mamm Creek, Jonah, Greater Sierra, Cutbank Ridge and in Southern Plains shallow gas. Second, the $2.7 billion acquisition of Tom Brown, which included a portfolio of U.S. resource plays, and third, the divestment of mature, Canadian conventional oil and gas assets have accelerated this transition. To date in 2004, EnCana has divested of conventional assets which were producing approximately 129 million cubic feet per day and 30,600 barrels of oil per day, plus other non-core assets, generating proceeds of about $1.36 billion. As a result of these transactions and the company’s focused investment strategy, EnCana’s proportion of production from resource plays has increased from about 60 percent in 2003 to close to 75 percent. Additional divestitures of conventional assets in Western Canada are planned, and the vast majority of new capital is expected to be allocated towards resource plays.

EnCana 2004 Divestitures to September 30

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Future gas growth underpinned by 25 trillion cubic feet of natural gas resources

In 2004, EnCana is on track to produce more than 1 trillion cubic feet of natural gas. As of December 31, 2003 and including the Tom Brown reserves acquired in May 2004, EnCana’s proved gas reserves exceeded 9.4 trillion cubic feet, yielding a reserve life index of approximately nine years. Beyond that, EnCana has identified approximately 16 trillion cubic feet of Unbooked Resource Potential, which EnCana defines as estimated quantities of hydrocarbons on existing company lands that are expected to be converted to proved reserves in the next five years.

“Our Unbooked Resource Potential is unique to EnCana because it is unique to resource plays. This potential is not dependent upon exploration success, as is the case with conventional plays. Rather this resource potential is on lands we currently own and where the resources have been estimated based on wells intended to be drilled over the next five years in geologically defined areas. EnCana has a proven track record of converting resource potential into proved reserves in a highly-efficient and cost effective manner. Our Unbooked Resource Potential is the key driver behind our steady growth in proved reserves and production. Together, the company’s proved reserves and Unbooked Resource Potential for natural gas totals 25 trillion cubic feet, which represents close to 25 years — a quarter century — of clearly visible resource life at current production rates. This is what underpins EnCana’s visible long-life, sustainable gas production growth,” Morgan said.

Corporate developments

Dividend $0.10 per share

EnCana’s board of directors has declared a quarterly dividend of $0.10 per share payable on December 31, 2004 to common shareholders of record as of December 15, 2004.

EnCana renews Normal Course Issuer Bid

EnCana has received approval for renewal of the company’s Normal Course Issuer Bid from Toronto Stock Exchange (TSX). Under the renewed bid, EnCana may purchase for cancellation up to 23,114,500 of its common shares, representing five percent of the approximately 462 million common shares outstanding as at October 15, 2004. In the past 12 months under its previous Normal Course Issuer Bid, EnCana purchased 9,105,000 common shares, representing approximately two percent of the company’s outstanding shares on October 14, 2003, at an average price of C$51.56 per common share. Purchases under the renewed bid may commence on October 29, 2004 and may be made until October 28, 2005. Purchases will be made on the open market through the facilities of the TSX in accordance with its policies, and may also be made through the facilities of the New York Stock Exchange (NYSE) in accordance with its rules. Approval of the bid is not required from the NYSE. The price to be paid will be the market price at the time of acquisition. EnCana believes that the purchase of its common shares will help create value for the company’s shareholders.

Financial strength

Balance Sheet Highlights
(US$ millions, except percent and ratio amounts)

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To fund the Tom Brown acquisition, EnCana arranged a $3.0 billion credit facility, which was paid down to $846 million by the end of September. On July 29, EnCana made a public offering in the United States of US$250 million of 4.60% Notes due August 15, 2009 and US$750 million of 6.50% Notes due August 15, 2034. The net proceeds of the offering were used to repay a portion of EnCana’s existing bank and commercial paper indebtedness. These investment grade debt securities are rated A- Outlook Negative by Standard & Poor’s Ratings Services, Baa2 by Moody’s Investors Service and A(low) negative trend by Dominion Bond Rating Service (DBRS).

In the third quarter of 2004, EnCana invested $1,098 million of core capital, acquisitions totaled $49 million and divestitures were $940 million, resulting in net capital investment of $207 million.

CONFERENCE CALL TODAY

EnCana Corporation will host a conference call today, Wednesday, October 27, 2004 starting at 11 a.m., Mountain Time (1 p.m. Eastern Time), to discuss EnCana’s third quarter 2004 financial and operating results. To participate, please dial (913) 981-4903 approximately 10 minutes prior to the conference call. An archived recording of the call will be available from approximately 5 p.m. on October 27, 2004 until midnight November 2, 2004 by dialing (888) 203-1112 or (719) 457-0820 and entering pass code 974614. A live audio Web cast of the conference call will also be available via EnCana’s Web site, , under Investor Relations. The Web cast will be archived for approximately 90 days.

Non-GAAP measures

This news release contains references to cash flow, pre-tax cash flow, operating EBITDA (net earnings from continuing operations before interest, income taxes, DD&A, accretion of asset retirement obligation, foreign exchange loss (gain), gain on disposition and unrealized loss on risk management), EBITDA and operating earnings, and the related basic and diluted per common share amounts as applicable, which are not measures that have any standardized meaning prescribed by Canadian GAAP and are considered non-GAAP measures. Therefore, these measures may not be comparable to similar measures presented by other issuers. These measures have been described and presented in this news release in order to provide shareholders and potential investors with additional information regarding EnCana’s liquidity and its ability to generate funds to finance its operations.

EnCana Corporation

With an enterprise value of approximately $30 billion, EnCana is one of the world’s leading independent oil and gas companies and North America’s largest independent natural gas producer and gas storage operator. Ninety percent of the company’s assets are located in North America. EnCana is the largest producer and landholder in Western Canada and is a key player in Canada’s emerging offshore East Coast basins. Through its U.S. subsidiaries, EnCana is one of the largest gas explorers and producers in the Rocky Mountain states and has a strong position in the deep water Gulf of Mexico. International subsidiaries operate two key high potential international growth regions: Ecuador, where it is the largest private sector oil producer, and the U.K., where the portfolio includes the Buzzard oil field development. EnCana and its subsidiaries also conduct high upside potential new ventures exploration in other parts of the world. EnCana is driven to be the industry’s high performance benchmark in production cost, per-share growth and value creation for shareholders. EnCana common shares trade on the Toronto and New York stock exchanges under the symbol ECA.

ADVISORY REGARDING RESERVES DATA AND OTHER OIL AND GAS INFORMATION - EnCana’s disclosure of reserves data and other oil and gas information is made in reliance on an exemption granted to EnCana by Canadian securities regulatory authorities which permits it to provide such disclosure in accordance with U.S. disclosure requirements. The information provided by EnCana may differ from the corresponding information prepared in accordance with Canadian disclosure standards under National Instrument 51-101 (NI 51-101). EnCana’s reserves quantities represent net proved reserves calculated using the standards contained in Regulation S-X of the U.S. Securities and Exchange Commission. Further information about the differences between the U.S.

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requirements and the NI 51-101 requirements is set forth under the heading “Note Regarding Reserves Data and Other Oil and Gas Information” in EnCana’s Annual Information Form.

Natural gas volumes that have been converted to barrels of oil equivalent (BOEs) have been converted on the basis of six thousand cubic feet (mcf) to one barrel (bbl). BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of six mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent equivalency at the well head.

EnCana Corporation resource descriptions

EnCana uses the terms resource play, estimated ultimate recovery, resource potential and unbooked resource potential. Resource play is a term used by EnCana to describe an accumulation of hydrocarbons known to exist over a large areal expanse and/or thick vertical section, which when compared to a conventional play, typically has a lower geological and/or commercial development risk and lower average decline rate. As used by EnCana, estimated ultimate recovery (EUR) has the meaning set out jointly by the Society of Petroleum Engineers and World Petroleum Congress in the year 2000, being those quantities of petroleum which are estimated, on a given date, to be potentially recoverable from an accumulation, plus those quantities already produced therefrom. Resource potential is a term used by EnCana to refer to the estimated quantities of hydrocarbons that may be added to proved reserves over a specified period of time largely from a specified resource play or plays. EnCana’s current stated estimates of unbooked resource potential use a five year time frame for their specified period of time.

ADVISORY REGARDING FORWARD-LOOKING STATEMENTS - In the interests of providing EnCana shareholders and potential investors with information regarding EnCana, including management’s assessment of EnCana’s and its subsidiaries’ future plans and operations, certain statements contained in this news release are forward-looking statements within the meaning of the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements in this news release include, but are not limited to: production, sales, reserves, and growth estimates for crude oil, natural gas and NGLs for 2004 and the next five years, including estimates calculated on a per share basis; the company’s ability to achieve its 2004 sales guidance; the company’s projections with respect to the percentage of production from resource plays in the future and the impact of increasing the company’s proportion of resource play assets on future decline rates and the reliability and predictability of resource and production growth; the resource potential, unbooked resource potential, production and growth potential, including the company’s plans therefor, and capital costs associated therewith with respect to EnCana’s various assets and initiatives, including assets and initiatives in North America, Ecuador, the U.K. central North Sea, the Gulf of Mexico and potential international exploration; estimates of resource life, including over the next 25 years; potential dispositions of assets in 2004 and beyond, including anticipated proceeds therefrom and the dates for receipt thereof; anticipated purchases pursuant to the company’s Normal Course Issuer Bid and the value of such bid to shareholders; the company’s projected capital investment levels for 2004, and the source of funding therefor; anticipated returns on capital; projected additional production from the Tom Brown, Inc. acquisition and the impact on production levels of proposed asset dispositions; the effect of the company’s risk management program, including the impact of derivative financial instruments; projected operating and administrative costs for 2004; projected DD&A rates for 2004 and beyond; projected levels of, and volatility of, crude oil and natural gas prices in 2004 and beyond and the potential causes therefor, including the impact which weather, the timing of new production, economic activity levels and political instability may have on commodity prices in the near term; projected tax rates and projected current taxes payable for 2004 and the impact of future unrealized foreign exchange gains and losses thereon and the adequacy of the company’s provision for taxes; projections with respect to the number of wells drilled and well tie-ins made in 2004; the impact of new oil and natural gas price hedging accounting standards, including their impact on the volatility of future reported net earnings; unbooked resource potential which may be recognized as proved reserves in the future; projections with respect to anticipated future cash flow levels; projections with respect to potential future drilling and service cost escalations; the impact of the company’s divestitures and potential divestitures on operating costs, netbacks and decline rates and references to potential exploration. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts,

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projections and other forward-looking statements will not occur, which may cause the company’s actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things: volatility of oil and gas prices; fluctuations in currency and interest rates; product supply and demand; market competition; risks inherent in the company’s marketing operations, including credit risks; imprecision of reserves estimates and estimates of recoverable quantities of oil, natural gas and liquids from resource plays and other sources not currently classified as proved reserves; the company’s ability to replace and expand oil and gas reserves; its ability to generate sufficient cash flow from operations to meet its current and future obligations; its ability to access external sources of debt and equity capital; the timing and the costs of well and pipeline construction; the company’s ability to secure adequate product transportation; changes in environmental and other regulations; political and economic conditions in the countries in which the company operates, including Ecuador; the risk of war, hostilities, civil insurrection and instability affecting countries in which the company operates and terrorist threats; risks associated with existing and potential future lawsuits and regulatory actions made against the company; and other risks and uncertainties described from time to time in the reports and filings made with securities regulatory authorities by EnCana. Although EnCana believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the foregoing list of important factors is not exhaustive.

Furthermore, the forward-looking statements contained in this news release are made as of the date of this news release, and EnCana does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

Further information on EnCana Corporation is available on the company’s Web site, www.encana.com, or by contacting:

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Interim Consolidated Financial Statements
(unaudited)
For the period ended September 30, 2004

EnCana Corporation

U.S. DOLLARS

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EnCana Corporation

CONSOLIDATED STATEMENT OF EARNINGS (unaudited)

CONSOLIDATED STATEMENT OF RETAINED EARNINGS

See accompanying Notes to Consolidated Financial Statements.

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EnCana Corporation

CONSOLIDATED BALANCE SHEET (unaudited)

See accompanying Notes to Consolidated Financial Statements.

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EnCana Corporation

CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)

See accompanying Notes to Consolidated Financial Statements.

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EnCana Corporation

Notes to Consolidated Financial Statements (unaudited)

(All amounts in US$ millions unless otherwise specified)

1. BASIS OF PRESENTATION

The interim Consolidated Financial Statements include the accounts of EnCana Corporation and its subsidiaries (the “Company”), and are presented in accordance with Canadian generally accepted accounting principles. The Company is in the business of exploration for, and production and marketing of, natural gas, natural gas liquids and crude oil, as well as natural gas storage operations, natural gas liquids processing and power generation operations.

The interim Consolidated Financial Statements have been prepared following the same accounting policies and methods of computation as the annual audited Consolidated Financial Statements for the year ended December 31, 2003, except as noted below. The disclosures provided below are incremental to those included with the annual audited Consolidated Financial Statements. The interim Consolidated Financial Statements should be read in conjunction with the annual audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2003.

2. CHANGE IN ACCOUNTING POLICIES AND PRACTICES

Hedging Relationships

On January 1, 2004, the Company adopted the amendments made to Accounting Guideline 13 (“AcG - 13”) “Hedging Relationships”, and EIC 128, “Accounting for Trading, Speculative or Non Trading Derivative Financial Instruments”. Derivative instruments that do not qualify as a hedge under AcG - 13, or are not designated as a hedge, are recorded in the Consolidated Balance Sheet as either an asset or liability with changes in fair value recognized in net earnings. The Company has elected not to designate any of its price risk management activities in place at September 30, 2004 as accounting hedges under AcG - 13 and, accordingly, will account for all these non-hedging derivatives using the mark-to-market accounting method. The impact on the Company’s Consolidated Financial Statements at January 1, 2004 resulted in the recognition of risk management assets with a fair value of $145 million, risk management liabilities with a fair value of $380 million and a net deferred loss of $235 million which will be recognized into net earnings as the contracts expire. At September 30, 2004, it is estimated that over the following 12 months, $42 million ($30 million, net of tax) will be reclassified into net earnings from net deferred losses.

The following table presents the deferred amounts expected to be recognized in net earnings as unrealized gains/(losses) over the years 2004 to 2008:

At September 30, 2004, the remaining net deferred loss totalled $7 million of which $72 million was recorded in Accounts receivable and accrued revenues, $3 million in Investments and other assets, $30 million in Accounts payable and accrued liabilities and $52 million in Other liabilities.

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EnCana Corporation

Notes to Consolidated Financial Statements (unaudited)
(All amounts in US$ millions unless otherwise specified)

3. BUSINESS COMBINATION WITH TOM BROWN, INC.

In May 2004, the Company completed the tender offer for the common shares of Tom Brown, Inc., a Denver based independent energy company for total cash consideration of $2.3 billion.

The business combination has been accounted for using the purchase method with results of operations of Tom Brown, Inc. included in the Consolidated Financial Statements from the date of acquisition.

The calculation of the purchase price and the preliminary allocation to assets and liabilities is shown below. The purchase price and goodwill allocation is preliminary because certain items such as determination of the final tax bases and fair values of the assets and liabilities as of the acquisition date have not been completed.

Included in current assets as Assets held for sale is $278 million related to the value of certain oil and gas properties located in west Texas and southwestern New Mexico and the assets of Sauer Drilling Company, a subsidiary of Tom Brown, Inc., which the Company has entered into purchase and sale agreements. These sales were completed on July 30, 2004.

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EnCana Corporation

Notes to Consolidated Financial Statements (unaudited)
(All amounts in US$ millions unless otherwise specified)

4. DISPOSITIONS (ACQUISITIONS)

In March 2004, the Company sold its investment in a well servicing company for approximately $44 million, recording a gain on sale of $34 million.

On February 18, 2004, the Company sold its 53.3 percent interest in Petrovera Resources (“Petrovera”) for approximately $287 million, including working capital adjustments. In order to facilitate the transaction, EnCana purchased the 46.7 percent interest of its partner for approximately $253 million, including working capital adjustments, and then sold the 100 percent interest in Petrovera for a total of approximately $540 million, including working capital adjustments. There was no gain or loss recorded on this sale.

On January 31, 2003, the Company acquired the Ecuadorian interests of Vintage Petroleum Inc. (“Vintage”) for net cash consideration of $116 million. On July 18, 2003, the Company acquired the common shares of Savannah Energy Inc. (“Savannah”) for net cash consideration of $91 million. Savannah’s operations are in Texas, USA. These purchases were accounted for using the purchase method with the results reflected in the consolidated results of EnCana from the dates of acquisition.

Other dispositions of discontinued operations are disclosed in Note 6.

5. SEGMENTED INFORMATION

The Company has defined its continuing operations into the following segments:

Midstream & Marketing purchases all of the Company’s North American Upstream production. Transactions between business segments are based on market values and eliminated on consolidation. The tables in this note present financial information on an after eliminations basis.

Operations that have been discontinued are disclosed in Note 6.

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EnCana Corporation

Notes to Consolidated Financial Statements (unaudited)
(All amounts in US$ millions unless otherwise specified)

5. SEGMENTED INFORMATION (continued)

Results of Operations (For the three months ended September 30)