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Randy Eresman, president and CEO, of Encana.The Canadian Press

Encana Corp. , seeking partnerships as it battles low natural gas prices, reached a joint venture agreement with an Asian conglomerate building energy assets in North America.

Encana sold 40 per cent of its undeveloped Cutbank Ridge property to Japan's Mitsubishi Corp. for $2.9-billion, the natural gas giant said Friday. Encana will pocket $1.45-billion when the deal closes later this month and cover $1.45-billion of its cost for the project over roughly the next five years.

The Calgary-based company, which plans to cut natural gas production by 600 million cubic feet per day, wants to reduce its stake in Cutbank Ridge by another 10 per cent, said Randy Eresman, Encana's chief executive.

North America's major natural gas companies have intensified their search for joint venture partners recently in order to shield their balance sheets as the continent's gas glut lingers. Further, the vast majority of the higher natural gas prices Encana had locked in through hedges will expire next year.

Partnerships such as the one with Mitsubishi allow natural gas companies to develop properties more quickly, accessing cash through the initial payments and creating the potential for profit through development that would otherwise be out of their reach.

Chesapeake Energy Corp. and Devon Energy Corp. , for example, both struck deals with foreign players in January. Chesapeake joined hands with France's Total SA , and Devon formed a partnership with Sinopec International Petroleum Exploration and Production Co.

Mr. Eresman expects to raise $500-million or more through asset sales and partnership agreements this year. While Encana has been shifting spending toward oil and natural gas liquids plays – aiming for such products as propane and butane – the company also wants to find partners to share in those riches.

Properties in the United States, such as the Tuscaloosa, Collingwood, and Eaglebine, as well as Canada's Duvernay, are also up for partnership consideration. Encana announced a joint venture agreement on Cutbank Ridge with China's largest state-owned energy company last year, only to have it fall apart in the summer.

"We undertook a lot of things last fall that if I said we were going to do them, I may not have been believed," Mr. Eresman said, noting the company raked in $3-billion in sales and partnership deals in the past six months. "I can speak from a much greater position of confidence now that we can undertake the additional transitions."

He added: "It might sound to you like we're doing an awful lot of additional transactions. I'd say this is just sort of normal course for us now."

Encana made $46-million, or 6 cents a share, in the fourth quarter, down from $50-million or 7 cents a share in the period a year earlier.

Despite Encana's effort to buffer its balance sheet – striking a multibillion-dollar deal, preserving capital, hitting its quarterly guidance, cutting natural gas production, increasing its natural gas liquids production – investors are still cautious.

Although it is taking steps to improve its operations and finances, Encana's core business of producing gas continues to contend with very weak prices, one analyst noted.