Spending on exploration and production is going up after second quarter operations turned into positive cash flow, shale oil and gas producer Encana Corp. said.

Canada-based Encana said its "relentless focus" on controlling costs meant operating earnings improved to $89 million, against a first quarter loss of $130 million, and cash flow was up more than 75 percent from the previous quarter.

"Our success in capturing significant capital efficiency gains continues to increase our returns," Encana President and CEO Doug Suttles said in a statement. "By reinvesting savings and modestly increasing capital, we are adding 50 percent more drilling and completions activity to our 2016 program."

Encana blamed declines in first quarter revenue on the steep drop in energy prices, but said output was robust despite external market pressures. Even during the first quarter, the company said it remained on track to meet or beat its production goals for the year.

Crude oil prices are up more than $15 per barrel from their low point during the first quarter on signs demand was strong enough to take on some of the excess in supplies. Driven by improvements since the first quarter, Encana said it was raising its production expectations for the year.

Four shale assets in North America were the target of 95 percent of the company's capital investment plans and represented more than 70 percent of total second quarter production.

The company entered 2016 with by saying it was revising its spending plan for the year in order to strengthen its balance sheet with minor impacts on production. "Virtually all" of the spending would focus on its North American shale portfolio.