"This joint venture will build a foundation for the successful development of the Duvernay play and help to diversify our business portfolio," said Pheonix CEO Zhiming Li. "Encana is our ideal long-term partner for the development of our future natural gas business."
Encana shares rose 47 cents to $20.91 in Thursday afternoon trading on the Toronto Stock Exchange.
Encana and PetroChina began working on another natural gas joint venture in 2010— a $5.48 billion joint-venture deal for Encana's lands in the Montney region— but that deal fell apart in mid-2011 after they failed to agree on how that project would operate.
While Encana has been inking several joint venture deals in recent years so that it can develop its huge resource base more quickly, big state-owned Asian energy companies have also increased purchases of oil and gas assets in the Americas as part of a global strategy to gain access to resources needed to fuel their economies. Chinese companies have moved more carefully since CNOOC tried seven years ago to buy Unocal but was rejected by U.S. lawmakers who cited national security fears.
Harper has in fact lobbied China to invest in Canada's energy sector in recent years, saying billions in foreign investment are needed to develop Canada's vast oil and gas deposits.
The government has also recently approved the takeover of Canada's Progress Energy Resources Corp. by Malaysian state-owned firm Petronas.