Since 2008, Encana Corp., Calgary, (Toronto, NYSE: ECA) has acquired approximately 250,000 net acres in the Collingwood shale, a promising unconventional gas play in Michigan.

Petoskey Exploration LLC, a subsidiary of Encana, drilled and completed the company’s first Michigan Basin well in Missaukee County; the horizontal well is currently producing from the Collingwood and Utica shale. The state’s gas production is some 400 million cu. ft. per day.

Encana chief executive Randy Eresman says, “Our first well flowed during a 30-day initial production test at about 2.5 million cu. ft. per day, including natural gas liquids constituents and condensate. With further drilling, we hope to demonstrate stronger gas rates.”

He adds, “It’s too early to know the economic potential of this new Collingwood shale play, but we plan to drill additional exploration wells this year that will help determine the play’s ultimate potential.”

To date, the North American gas producer has expanded its leasehold in approximately seven counties in the Lower Peninsula of Michigan, with Collingwood acreage averaging $150 per acre.

Encana has oil and gas operations in Canada and the U.S.