We report the etching of and electronic transport in nanoribbons of graphene sandwiched between atomically flat hexagonal boron nitride (h-BN). The etching of ribbons of varying width was achieved with a focused beam of 30 keV He⁺ ions. Using in-situ electrical measurements, we established a critical dose of 7000 ions nm⁻² for creating a 10 nm wide insulating barrier between a nanoribbon and the rest of the encapsulated graphene. Subsequently, we measured the transport properties of the ion-beam etched graphene nanoribbons. Conductance measurements at 4 K show an energy gap, that increases with decreasing ribbon width. The narrowest ribbons show a weak dependence of the conductance on the Fermi energy. Furthermore, we observed power-law scaling in the measured current-voltage (I-V) curves, indicating that the conductance in the helium-ion-beam etched encapsulated graphene nanoribbons is governed by Coulomb blockade.