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Wed, Jun 08, 2005 - Page 12 News List

China's CNOOC confirms possible offer for Unocal


China National Offshore Oil Corporation (CNOOC, 中國海洋石油) confirmed yesterday it was considering launching a possible bid for US oil major Unocal, rivaling an offer made by ChevronTexaco Corp.

"The company ... is continuing to examine its options with respect to Unocal," CNOOC, China's third-largest oil company, said in a statement to the Hong Kong Stock Exchange.

"These options include a possible offer by the company for Unocal but no decision has been made in this respect.

"No assurances can be made that the company will ultimately make an offer for Unocal or, if any such offer is made, whether any agreement will be reached between the company and Unocal."

CNOOC said the statement was in response to media speculation about a possible offer by the company for the US oil giant.

It said a further announcement would be made "if and when appropriate."

The issue raises the prospect of a first ever take-over battle between a Chinese and an American company following ChevronTexaco's US$16-billion bid for Unocal.

If CNOOC were to go ahead with an attempt to take over Unocal, it would fit into a larger Chinese strategy of securing access to energy sources overseas.

Unocal has gas and oil reserves in Thailand, Indonesia and Central Asia.

Last month the Financial Times reported that the non-executive directors at CNOOC had hired independent advisers to review the management's plans for a possible bid for Unocal.

It said Unocal has a market capitalization similar to CNOOC's and a huge deal such as this would mean a large increase in the Chinese company's debt.

Unocal has more than 6,000 employees, with most of its activities in Asia and North America. It has no refining or marketing operations.

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