| ||
| ||
| ||
 |
|
|
|||||||||||||||||||||||||||||||||||||||||||||
Kazakh oilfield lures Chinese duo
By Geoff Hiscock
HONG KONG, China (CNN) -- Chinese oil companies Sinopec and CNOOC are set to capture one-sixth of Kazakhstan's giant North Caspian Sea project following two deals with U.K.-based BG Group. The planned purchases mark another step in China's expansion into overseas oil and gas projects. BG Group said in an announcement to the London Stock Exchange on Tuesday that No. 2 oil producer Sinopec had agreed to buy BG's remaining 8.33 percent stake in the project for $615 million. That follows the deal between BG and CNOOC (China National Offshore Oil Corp.) last Friday for the Chinese producer to buy a stake of the same size at the same price. Completion of the two transactions, totaling $1.23 billion, is conditional on approval from the Kazakhstan and Chinese authorities, and on BG's partners waiving their pre-emptive purchase rights. Those partners include: • Project operator ENI with 16.67 percent, • ExxonMobil, Shell and TotalFinaElf, also with 16.67 percent each, • and ConocoPhillips and INPEX, each with 8.33 percent. CNOOC said this week that its March 7 deal with BG had only a 50-50 chance of proceeding, given that the other partners had 60 days in which to exercise their right to block the sale. The partners' North Caspian Sea production-sharing agreement covers 5,600 square kilometers and includes the massive Kashagan oil field, the Kalamkas oil discovery and the Kairan, Aktote and Kashagan SW prospects. Drilling in the region began in 1999 and in June 2000 the partners announced the Kashagan discovery. Production is expected to start in 2006 and reach a peak in 2010. Huge reservesThe Kashagan field, hailed as one of the world's largest finds of the past 30 years, has estimated recoverable reserves of up to 13 billion barrels of oil equivalent.
BG chief executive Frank Chapman said Tuesday that despite selling out of the North Caspian Sea project, BG remained "strongly committed" to Kazakhstan through its interests in the gas condensate field at Karachaganak and in the Caspian pipeline consortium. Sinopec Group president Li Yizhong said Sinopec had been on the lookout for attractive oil and gas upstream acquisitions. He said the North Caspian Sea project offered "significant reserve and production growth potential." Sinopec and China's two other listed oil producers, CNOOC and Petrochina, have been aggressive acquirers of overseas oil and gas interests in recent months. In mid-2002 China committed to massive long-term imports of liquefied natural gas (LNG) from Australia and Indonesia, and took stakes in those projects via CNOOC. That was followed in October by Sinopec's announcement that it would invest $394 million for a 75 percent stake in the Zarzaitine oil field in Algeria. Petrochina's parent, China National Petroleum Corp (CNPC), is lead manager on the Chinese side for a proposed 2,200-kilometer pipeline linking Russia's Angarsk oil field with the Daqing field in northern China. Russia is due to make a decision this month on whether to proceed with the pipeline. PetroChina has already signed up with Shell, ExxonMobil and Russia's Gazprom for the 4,000-kilometer West-East gas pipeline, which will run from China's Xinjiang province to Shanghai on the east coast. But in December, CNPC was blocked from bidding for Russian oil firm Slavneft, which produces most of its oil in Siberia, near the Chinese border. Shares in Sinopec are 2.08 percent lower in Hong Kong Wednesday afternoon at HK$1.41. CNOOC is down 1.4 percent to HK$10.60 and PetroChina is 0.62 percent lower at HK$1.61. The broader market, measured by the Hang Seng index, is about a third of a percent higher.
|
|
|||||||||||||||||||||||||||||||||||||||||||||
|
|
