Mitsubishi committed to pay C$2.9 billion ($2.91 billion) for the stake including $1.45 billion at closing and an additional $1.45 billion investment in the project's development along with promised investments tied to its minority interest.

"Mitsubishi looks forward to tapping new natural gas supplies for the long-term development and eventual delivery to world markets," said Mitsubishi's Jun Yanai, who heads its energy business, in a statement.

Japanese energy companies stepped up drilling for fossil fuels after the Fukushima disaster soured the country on nuclear power. Marubeni Corp. in January agreed to buy 35% of Hunt Oil Co.'s properties in South Texas' Eagle Ford Shale and invest $1.3 billion. The Japanese trading giant also bought 30% of the Niobrara shale oil project last year from Marathon Oil Co. for $270 million.

Along with Marubeni and Mitsubishi, Itochu Corp., Mitsui & Co. Ltd. and Sumitomo Corp. have made similar investments.

But Mitsubishi isn't just buying fossil fuels. In November it bought a 24.5% stake in Anglo American plc's Chilean copper unit for $5.39 billion. It also recently closed on the purchase of an 18.1% stake in an Anglo American Peruvian copper business from International Finance Corp.

Following Friday's deal, Encana will have to cover only about 30% of the investment for Cutback Ridge, which has 900 billion cubic feet of proven natural gas reserves and possibly as much as 130 trillion cubic feet, the company said.

Encana has been on a dealmaking tear as low natural gas prices hit its bottom line and after the collapse of a tentative deal with PetroChina Co. Ltd. The two wanted to form a $5.5 billion joint venture with Encana's interests in northeastern British Columbia and Alberta but couldn't agree on operational details.

The Canadian company in December agreed to sell its midstream gas gathering and processing plants in Alberta and British Columbia for C$920 million to Veresen Inc. and in November agreed to sell its North Texas natural gas properties in the Barnett Shale to EnerVest Ltd. for $975 million.

It has also sold other U.S. energy assets and some gas plant businesses in Canada.

RBC Capital Markets and Jefferies & Co. provided financial advice to Encana while Burnet, Duckworth & Palmer LLP served as legal counsel. Barclays Capital acted as financial adviser to Mitsubishi.