Encana Inc. (ECA) said Tuesday the proposed Kitimat liquefied natural gas export terminal in British Columbia will help to stabilize gas prices in North America and provide an outlet for growing production from the province's Horn River Basin.

Executives from Encana, which holds a 30% stake in the $2.9 billion Kitimat project, said during an investor presentation Tuesday that they're in talks with six customers in Asia to take delivery of shipments from the Kitimat LNG terminal.

Encana and its partners including EOG Resources Inc. (EOG) and Apache Corp. (APA) will make a final decision on whether to proceed with the Kitimat project in the first quarter of next year, after a front-end engineering and design study is complete, the executives said. If approved, Kitimat would begin operating in late 2015, eventually shipping up to 1.4 billion cubic feet a day to Asia.

Encana, North America's second-largest natural gas producer after Exxon Mobil Corp. (XOM), has been hit hard by persistently low natural gas prices in North America as technology unlocked new supplies. Earlier this year, low prices forced Encana to abandon its aggressive plan to double its production to nearly 7 billion cubic feet a day by 2015. And an attempt to speed production growth by finding joint-venture partners hit a major setback this summer when a $5.5 billion deal with PetroChina Co. (PTR) fell apart.

Outside North America, natural gas prices remain high, especially in Asia where Encana expects demand to double to 65 billion cubic feet a day as China and India increase their consumption.

Encana's plan to ship natural gas to Asia coincides with the large land position it's staked in B.C.'s Horn River Basin.

"The Horn River resource base is enormous, highly accessible and will certainly play a large role in North American, and even global gas supply in the years to come," Vice President of Canadian New Ventures Kevin Smith told investors during the presentation.

Smith said the Horn River Basin, in the far northeastern corner of British Columbia, is one of the richest areas for natural gas in North America - but that it's a long way from major U.S. markets.

Some of the Horn River production can be used by the growing oil-sands industry in neighboring Alberta, Smith said, which Encana estimated will require an extra 1.3 billion cubic feet a day of natural gas by 2020. But a major source of demand will come from Asia, which Encana said will need an extra 15 billion cubic feet a day from LNG exports by 2020 to keep up with its growth.

Smith said Encana has accumulated 278,000 acres of about 2 million acres available at Horn River, and will produce about 95 million cubic feet a day from the basin this year, a small fraction of the 3.5 billion cubic feet a day the entire company produces. But he pointed to estimates that production from the entire basin could reach 5 billion cubic feet a day by 2020, if processing capacity is expanded.

Encana has said that long-term natural gas prices should eventually rise to between $6 to $7 per thousand cubic feet, and that current prices are unsustainable. Front-month natural gas futures recently traded in New York at $3.644 a million British thermal units.