Home / World Business
Wed, Jul 08, 2009 - Page 10 News List

CNPC bids for 75% stake in YPF: report

BUYER’S MARKET: China is taking advantage of the global recession to buy assets around the world that are being sold for a fraction of their previous value

AFP , HONG KONG AND BEIJING

China National Petroleum Corp (CNPC, 中國石油天然氣) has offered between US$13.2 billion and US$14.5 billion for a 75 percent stake in an affiliate of Spanish oil major Repsol, a report said yesterday.

Executives at China’s biggest energy producer held talks on the offer for YPF, Repsol’s Argentine unit, and the initial reaction from the Spanish side was receptive, the South China Morning Post quoted unnamed sources as saying. It also said China National Offshore Oil Corp (CNOOC, 中國海洋石油), the country’s biggest offshore oil and gas producer, was understood to be eyeing up to a 25 percent stake in YPF.

CNOOC has reportedly proposed injecting at least US$15 billion into a joint venture that will own some of Repsol’s core exploration and production assets.

Repsol YPF announced last Thursday that it had received interest but no firm offers for a minority stake in its 84.14 percent-owned YPF.

Earlier reports said talks were continuing through Goldman Sachs, which has been in touch with a number of Asian groups, of which CNPC and CNOOC appear the most interested.

China’s government-backed oil companies are seizing on the economic crisis and the accompanying low asset prices to make landmark overseas acquisitions in a bid to feed the country’s growing economy.

The country’s three biggest oil companies may take part in Iraq’s second auction of oil and gas fields, as the Asian giant seeks to strengthen its foothold in the oil-rich nation, state media said yesterday.

The country’s top oil producer CNPC, Asia’s biggest refiner Sinopec (中國石化) and CNOOC, all bid last week in Iraq’s first auction of oil contracts since 2003, the China Daily said.

Only CNPC, in a tie up with British energy giant BP, won a service contract to develop the Rumaila oil field, which was also the only contract awarded in the auction.

CNPC and Sinopec may take part in the second auction, reported to be scheduled for the end of this year, as they “cannot neglect the rich oil and gas reserves in Iraq,” the China Daily said, citing an unnamed source.

CNOOC president Fu Chengyu (傅成玉) has said that the company might participate in the second round of bidding as well, the report said.

“Domestic oil companies will not miss this unprecedented opportunity,” said the source, adding that the firms may again join forces with foreign companies for the second round of bidding to reduce risk.

China has been active in gaining a share in the oil market in Iraq, which has the world’s third-biggest proven petroleum reserves.

Last year, CNPC signed a US$3 billion deal to develop the al-Ahdab oil field, marking the first major oil development deal that a foreign firm has secured in Iraq since the fall of former Iraqi president Saddam Hussein in 2003.

This story has been viewed 1319 times.
TOP top