Rachel Notley reaching out to energy sector

Alberta premier-designate Rachel Notley has taken the initiative to reach out to the energy sector since her election win last week.

Doug Suttles, CEO of Calgary-based oil and gas company Encana, saidhe took a phone call from Notley in recent days.

"The core of the conversation was, let's make sure we talk as you consideralternatives, and if we can support in any way with information or insights, we are happy to provide that," he said."I've got to believe her biggest challenge at the moment is putting her government together, and it's a bit early to be speculating on policy changes."

You would almost have to be from another planet not to understand how important oil and gas is to Alberta andAlbertans.EncanaCEO Doug Suttles

The NDP ran on a platform that included an increase in corporate taxes and a review of royalties paid by oil and gas companies. The party's victory has ledto concern bythe industry.

Some Encana shareholders aired their concerns at the company's annual general meeting in Calgary on Tuesday.

"Certainly what happens in the oil and gas sector is going to affect people like myselfwho are not part of the one per cent, but have held shares in Encana for several decades," saidIreneBruzga. Shewants the company to do well because she depends on the dividend from her shares tosupplementher income in retirement.

Energy sector CEOs have largely been diplomatic about potential changes fromthe new government.

"You would almost have to be from another planet not to understand how important oil and gas is to Alberta and Albertans," saidSuttles."You've got to be careful about speculating about what might happen. The important point here is I don't think it's lost on governments or new governments that it is a very competitive market out there."

Suttles saidEncana can provide a perspective on operating not only in Alberta, but also in British Columbia and parts of the U.S. He saidhis conversation with Notley was brief and helped open the lines of communication between the energy sector and the new government.

"Since the election, our government affairs team have talked to members of the NDP and essentially said if we can support in anyway, such as policy issues, we would be happy to do that," saidSuttles.

Encana's results

The company recorded a $1.7-billion US loss inthe first quarter. The figure includes$1.2 billion USin asset impairments. Encana's operating earnings were$9 million US and its cash flow dropped to $495 million US.

• Encana cuts capital spending plan by $700MUS
• Alberta heavy oil price up almost 80% since March

Earlier this year, the company said it wasassuming $50 US a barrel for the benchmark West Texas Intermediate (WTI) crude. WTI has risen and now sits at about $60 US a barrel.

"We didn't believe $100 oil was going to last foreverand we don't believe $50 will lastforever," saidSuttlesto shareholders.

Buying and selling

Suttles described 2014 as a "transformational year." The companyracked up $18 billion US in transactions as it shifted away from being a purely natural gas producer.

"It's probably too soon to call it yet on whether or not this strategy is the right one for them," saidTriciaLeadbeater, wealthmanagementdirector with Richardson GMP.

Encana bought aTexas oilfield for $3.1 billion from Freeport-McMoRan. purchasedTexas-based Athlon Energy for$7.1 billionand sold itsBighorn assets to Jupiter Resources for $1.8 billion, among other deals.